Bitcoin is good for both merchants and consumers, according to two executives from Bitcoin processor BitPay, who are speaking at the Cryptolina Bitcoin Expo at the Raleigh Convention Center today (Friday, Aug. 15). A highlight of the afternoon program is a free workshop for merchants interested in accepting bitcoin payments from 2-4 p.m.
We interviewed Elizabeth Ploshay, account manager at BitPay as well as a Bitcoin Foundation board member, and John Dreyzehner, West Coast operations manager, for BitPay ahead of their appearances at the event this weekend.
(For more about the conference itself, read WRAL TechWire’s preview with links to bitcoin background material.)
Both are passionate about the potential that Bitcoin has to streamline ecommerce, eliminate credit card fees merchants pay, and facilitate global business, entrepreneurship and job creation. That’s a big agenda, but both Ploshay and Dreyzehner explained how it can do all of that.
Remember that ugly word bandied about in the early Internet days, “disintermediation?” It meant the Internet often allowed businesses and consumers to bypass the middle men in many transactions, thus making them easier, faster, and less expensive.
Bitcoin has a similar effect on the financial industry, the BitPay execs say. By cutting out the middle man, you avoid all sorts of transaction fees, the need for escrow when buying a house, the credit card fees merchants have to pay, bank fees, and so on.
BitPay charges no fees for processing Bitcoin transactions, but makes money by selling premium services to its larger customers such as Amazon and eBay.
“Bitcoin removes third parties from the system,” says Dreyzehner. “We don’t need to trust them anymore.”
He adds, however, “We’re not trying to reinvent the wheel. We’re just enabling people to pay with a better method.”
Merchants working with BitPay can elect to have their bitcoin transactions processed as dollars every 24 hours with the dollar amount guaranteed by the firm regardless of the current value of bitcoin, which varies.
“You go in a coffee shop and want to pay for your $2 coffee with bitcoin. The merchant enters the amount in his BitPay account and it generates a QR code (bar code). You go to your mobile wallet, scan the code and hit the key for sending money.”
And you don’t have to worry about hackers breaking into merchant accounts the way they did Target and other high profile businesses the last few years, because you never provide any personal or credit card information.
The same is true if you shop online.
“I used to feel comfortable shopping online with a credit card, but after I made my first bitcoin transaction,” says Ploshay, “I asked myself, ‘Why am I supplying all this personal information and also my credit card number? Not only is it time consuming, but you’re exposing yourself.”
“One thing people are passionate about is the ability of bitcoin to remove those long processes,” adds Dreyzehner. “You can send money anywhere immediately. It’s much more efficient.”
Ploshay also sees bitcoin as a way to promote global commerce and an easy way to send money anywhere. Among other advantages, it frees you from exchanging dollars for another currency.
“You don’t have to switch around currencies,” Dreyzehner says.
“Never before were people able to send money around the world in this way,” says Ploshay. “There are 3.5 million people around the world without a bank account.”
When it comes to ecommerce, shopping with bitcoin – which can be bought or used in denominations down to eight decimal places – is faster and more secure than using credit or debit cards.
Dreyzehner, in addition to being at Friday sessions, is conducting a Bitcoin 101 session at 9 am Saturday morning.
He says he generally starts with questions to find out what the audience already knows and structures his story around their questions.
Dreyzehner is bullish about the future of Bitcoin. “I think everyone has an incentive to incorporate Bitcoin. Banks could switch money between branches more easily than moving cash. Credit cards could even get into it. It’s just a matter of time until people get comfortable with it, I think.”
