By Mars Dorian, {grow} Contributing Columnist
Imagine if you could have 100% control over your money, pay every person on the planet in seconds, even if they don’t own a bank account, with almost zero fees and absolute freedom?
Sounds like a cheesy ad for a sleazy bank, but the vision is more real than you think. I’m talking about an innovation called Bitcoin. Since most of us work digitally, why do we cling to currencies that belong to the physical world?
What is Bitcoin (explanation)
First of all, let’s define Bitcoin. It’s an encrypted digital currency that gets distributed peer-to-peer. It functions without a central authority and works everywhere you can access the web.
But why use it ?
Boy was I wrong.
I had no idea about the global economy that sprang from this digital currency. Heck, I even met one of the co-developers who programmed the Bitcoin Wallet app (that day, he bought Bitcoins worth over 1,500 € ($2,025), I was sweating waterfalls just seeing that happening.)
I met Bitcoin-iacs left and right … a biz owner who sells vinyl around the planet and accepts Bitcoin payments, a digital artist who offers his artwork in Bitcoins, and a guy who created a service that lets you pay for any Amazon products and pay with Bitcoins. They all spread the gospel and drooled over a Bitcoined world (one of them gave me the WTF look with eyes wide open when I admitted I didn’t own a single Bitcoin yet).
After that hefty event, we went to Room77, a hip restaurant that allows Bitcoin payment. One of the speakers of the exchange paid for all of our beer and pizza – guess – in Bitcoin again.
This was surreal, as if I discovered a secret world beneath the surface.
Now you could say, well, a bunch of hipster folks use it, so what? But the crazy news doesn’t stop there. Germany is the first country to accept Bitcoin as a private currency, giving it quasi-legal status. China’s biggest site, Baidu, now accepts Bitcoin as payment. The market price of this digital currency is skyrocketing, and startups around the globe get funded to make Bitcoin more mainstream.
With so much action going on, I’ve decided to offer my services in Bitcoin as well. I’m not a maniac who bets his future on it, but I also don’t want to get swayed sideways if it becomes mainstream.
No matter if you’re into social media or other web related work, you should think about accepting Bitcoin for your business.
Let me show you the pros and cons about using that exciting new currency that knows no country, no owner, no boundaries.
3 major pros and cons for using Bitcoin
Pros
1) Ease of payment, because it’s truly global.
International transfers are still a pain in the butt. They can take days or even weeks and come with bureaucratic nonsense. Most countries in the world don’t have access to Paypal, since it requires a “normal” bank account to work. But everyone who’s got access to the internet has access to Bitcoin.
Heck, it’s made for the web, a truly global currency.
2) Very low fees (if any at all)
Visa, Paypal and Co. demand hefty percentages from your transfers – they are the middlemen to you and your clients. Bitcoin comes with low fees, or no fees at all. Since no single entity owns it, you can’t put price tags on it.
3) Freedom of use.
Let’s face it – your bank and Paypal accounts can get frozen on a whim, or shut down completely. The government could take your money to bail out their shenanigans. (Cypress anyone?)
With Bitcoin, you have 100% freedom over your money. You, and only YOU decide what happens with it.
Cons
1) Takes (minor) tech knowledge to handle.
Unfortunately, Bitcoin isn’t as straight forward as our traditional currency. You have to find services online to use it properly, and you have to take care of your Bitcoin key storage and make backups.
2) Huge fluctuations.
Bitcoin has skyrocketed in value (from $14 in January to $211 in November 2013), it is still prone to rollercoaster up and downs. With the lack of mass market adoption, major events like the shutdown of Bitcoin based sites like Silkroad cause it to fluctuate dramatically.
3) Current lack of mainstream appeal.
Many startups and businesses around the globe are working to make Bitcoin mainstream, but it has a long way to go. You probably can’t pay your rent or for your food with Bitcoin. As of the writing of this post, is still limited to specific pages and products. (You can however exchange your current Bitcoins into real currencies, e.g. Dollar and Euro.)
Since most of us are doing business on the web, it makes sense to use a currency that was created for the web. If have $100 you can spare, why not experiment with it? It could be huge.
Have you tried it yet?
Original illustration by the author.