Bitcoin is booming as a speculative investment, but how does its adoption and usage fare in the real world? From a small group of outliers to major international merchants, it appears that Bitcoin is on the rise to become a viable alternative currency.
World’s first bitcoin-exclusive employee
Olaf Carlson-Wee is no stranger to Bitcoin. He wrote his undergraduate thesis on the cryptocurrency. At the time, nearly no academic research existed on the subject. When he first started out with crypto, he invested US$700 in Bitcoin at the high price of US$16 each. It later dropped down to US$2.
But Carlson-Wee knew a good thing when he saw it. After living in a yurt in a commune, he emailed Bitcoin exchange Coinbase and become its first employee. He was also the first employee at the company – and possibly the world – to receive his full salary in Bitcoin. Coinbase has since become the most popular US-based Bitcoin exchange.
Sadly, he failed to negotiate his monthly paycheck at a fixed amount of Bitcoin. Instead, he received a dollar-denominated salary of US$50,000 that is converted to Bitcoin at the time of payment. However, this has been for the best. For the company’s sake, at least. When he took on the role, 1 bitcoin equalled around US$20-US$30. Today, it’s at US$4,850. Coinbase would highly likely have been driven into bankruptcy.
While at Coinbase, he famously rolled out a “Bitcoin SAT” for new hires. (The exchange only hired additional people once it hit 250,000 users.) This was due to the technical nature of the job. All 8 of the applicants that made the cut received their salaries in Bitcoin. His contributions to the exchange didn’t end there. After a promotion to head of risk, he managed to lower Coinbase’ fraud rate by 75 percent thanks to AI algorithms he implemented.
Carlson-Wee is the son of Lutheran pastors and was studying sociology when he first learned about Bitcoin. His two brothers became poets, and he has moved on from managing Coinbase’ customer care division to managing crypto hedge fund Polychain Capital, now worth in excess of US$200 million in the span of 10 months.
Selling all for the sake of Bitcoin
This week, a Dutch businessman and minimalist, Didi Taihuttu, made the news when he revealed his bitcoin-enthusiast lifestyle. The 39-year-old father of 3 returned from a nine-month world trip with his family when he and his wife decided that they would be downscaling…extremely so. First, he sold off his business to travel the world with his family.
While on the road, the value of Dogecoin – which Taihuttu was hodling – shot through the roof alongside bitcoin’s climb to US$3,000. This captivated him enough to get back into cryptocurrency.
When they returned to the Netherlands, they sold their four-bedroom villa for 85BTC and are continuing their simple nomadic lifestyle…now from a campsite in the country.
The family cites minimalism and a holistic education and lifestyle for their kids free from overly materialistic values as their main driving force for this unusual lifestyle decision.
And Taihuttu is not overly concerned with things going awry between now and the 2020 cut-off date they’ve set for themselves.
“Then we will be without money for a moment. But I don’t think that that’s the worst thing that can happen in life.”
Testing the waters
Not everyone is as gutsy and brave as Carlson-Wee and Taihuttu. A few individuals have played guinea pig, navigating their way around the use of bitcoin in everyday life.
Life on Bitcoin
Living on Bitcoin in the Real World
Forbes’ Senior Online Editor, Kashmir Hill, no doubt inspired by the Craig family, wrote a 2014 book about surviving on bitcoin for a week.
The practicality of living on Bitcoin in 2017
A CNBC reporter conducted a week-long experiment on the practicality of surviving in New York City for a week using only bitcoin. She found it possible and easy to buy, yet time-consuming owing to the extra number of steps involved, difficult due to the necessity of third-party involvement linking you to retailers, and expensive due to the premiums charged.
Since it’s a virtual currency, it’s obvious that living an online lifestyle will afford you more opportunities to pay in Bitcoin. Microsoft, Steam, PayPal, WordPress, and Expedia all accept the currency. Steam even has an interactive Bitcoin virtual reality game, which you can play to see a Bitcoin transaction on the blockchain in real-time.
Now that Uber has appointed Expedia’s former head as CEO, we’re waiting with bated breath. In Argentina, July 2016 saw Uber drivers independently accept bitcoin as payment due to government restrictions on Uber’s operations in the country.
And with Shopify offering its 377,500+ merchants the option to accept bitcoin in their ecommerce stores (something the online retail platform first implemented in 2013), it is now a reality to run your own business with bitcoin.
Overstock.com CEO, Jonathan Johnson, is outspoken on the positive aspects of accepting bitcoin as payment, claiming that it’s “crazy that so many retailers don’t accept bitcoin.” He adds that it holds great benefits for merchants:
“The cost of accepting bitcoin is very low. It’s actually cheaper for us to complete a bitcoin transaction than it is to complete a credit card.”
And if it’s gambling you’re after, Vegas Casino is a full-on bitcoin casino. Further afield, if you’re planning on going to space anytime soon, Richard Branson’s Virgin Galactic is also accepting the cryptocurrency. Winklevoss Capital twins Cameron and Tyler have already booked their astronaut seats on SpaceShipTwo … in bitcoin, of course.
Offline, the story is a little different. As a new technology which has not seen widespread adoption yet, Bitcoin and the real world don’t easily mix. Not yet, anyway. In Japan, there is an aim that 260,000 stores will accept bitcoin by summer. Taiwan offers the chance to rent a room or go hiking thanks to the coins in your bitcoin wallet.
In the US and UK, bitcoin can quite easily buy you gift cards, which makes surviving on bitcoin – if not exclusively – easier than you might think. Coinsource is the largest Bitcoin ATM network in the US, with 103 ATMs nationwide.
In Berlin’s Kreuzberg area, forward-thinking businesses are accepting bitcoin for anything from cherry cake to city tours.
And Australian startup Living Room with Satoshi enables you to pay everyday bills using bitcoin.
Spendbitcoins.com claim to have a directory of over 100,000 bitcoin-friendly merchants. It’s unclear what percentage of these are offline businesses.
The website BTCmanager hosts a Bitcoin Travel Guide, and currently has entries for ‘Bitcoin Stad’ (‘Bitcoin city’) Arnhem in the Netherlands, Vienna, and London. In Bali, the Bitislands Project is a social experiment that aims to make Bali a bitcoin-friendly travel destination (or Bitcoin Paradise, as the case may be).
Wired reports that even the homeless are getting on board, earning bitcoins thanks to free wifi connections in city parks. A voluntarily homeless nomadic in Spain took to Reddit to express his appreciation for bitcoin.
Meanwhile, BitGive is the world’s first bitcoin-exclusive charity. Their work is in public health, where they leverage the power of Bitcoin and blockchain technology to improve lives.
Although we’re 8 years into the Bitcoin experiment, it’s early days yet. These mavericks are saying that bitcoin is here to stay…and they have the receipt books to prove their stakes.