What is Bitcoin, you ask? As I am no expert on the subject, I turned to one for help.
Jerry Brito, a senior research fellow at George Mason University’s Mercatus Center and director of its Technology Policy Program, knows Bitcoin inside and out. In a recent interview with Vice, Brito explained that it is a digital currency — think Facebook credits, frequent flyer miles, Microsoft points — that is decentralized. The first of its kind, actually, because unlike Facebook credits, which are distributed through Facebook, Bitcoin isn’t distributed through a third-party intermediary. “There is no Bitcoin company, no Bitcoin building, not even a Bitcoin server,” Brito explained during the interview. It’s an attractive form of currency because there are no credit card fees, and international transactions are cheap. Right now, one Bitcoin (BTC) is equivalent to $515 USD.
The first time I heard about Bitcoin was from my husband while we were visiting London last spring. It was all the financial world could talk about. The price of 1 BTC started under $14 at the beginning of the year, but hit a high of $266 on April 10. Over the next few days, it fell to $65. It piqued my interest, seeing how a market changes with certain cause and effect elements. At the same time, my husband and I were having problems with making payments along the way on our trip. The credit, debit and ATM cards we use in the U.S. are outdated compared to the much more secure Chip and Pin system that is in place in Europe; many businesses didn’t read our American-made cards. We were constantly running to the ATM to get out British pounds to pay for groceries and other services, and I got tired fast of incurring all those fees. I found out about Bitcoin and quickly became hooked.
The currency has gained some traction stateside. Tony Vo, owner of the Waterbean Coffee Shop in Cornelius, decided to jump on board after a customer requested the payment service. The same customer came back a week after the suggestion, and Vo had some software set up on his iPad that accepted Bitcoin. “I wanted to provide the customer with another option,” he says. “We wanted to be the first one in the restaurant industry, and now there’s a couple of businesses copying us, accepting it as well. Which is good because we want it to spread and people to accept it so that it can be trusted.”
I asked him if any new patrons started popping in (the Bitcoin community is pretty tight knit). “There’s a lot of people coming in that want to try it out and see how it works. But there are many repeat customers who want to spend their Bitcoins, and that’s pretty neat. The option I have set up automatically converts the Bitcoins into USD right away into the bank account. As for the fees, it’s a 1 percent flat rate, which credit card companies can’t compete with.”
If you’re interested in exploring Bitcoin, start off by buying a coin or coins, which are placed in your digital wallet. There are a variety of ways to do this. I use Coinbase, but there are several online exchanges to buy from, as well as accepting them for goods and services and just the old fashioned way of trading them person to person. Then you are ready to send and receive BTC from businesses or individuals. My first transaction at Waterbean Coffee was as simple as scanning their QR Code (those little Atari-like squares that act as more advanced UPC codes), instantly sending a payment at current market value. Within seconds, my vanilla almond latte was paid for, and it tasted pretty damn good.
A Bitcoin Meetup is scheduled for Saturday, Sept. 13, starting at 10 a.m. at 7th Street Public Market.