In March this year, the Baggot Inn of Lower Baggot Street became the first Irish pub to accept payments in the form of the world’s newest and most controversial currency, the BitCoin.
While the eyes and minds of pundits and politicians remain focused on the prospects, form and likelihood of economic recovery, the Internet has given rise to this curious financial innovation.
A valid currency, only a few years old and growing fast, not issued by any government, bank or financial institution, BitCoin has already created millionaires and divided commentators, with questions raised in the business and finance world as to its validity, given that it issues from no recognised authority.
However, its electronic nature seems to give it an advantage over any other type of alternative currency. NewsFour speaks to Chris Healey, Sales and Marketing Manager of the Baggot Inn, about their early adoption of this very modern fiscal mutation.
“We have a customer who comes in quite a bit,” Chris explains, “and around December or January he asked us about it, if we would consider it. We looked into it and pretty quickly decided ‘why not?’ It’s another method of payment at the end of the day.”
We want to know about how a person buys a round of drinks with BitCoins. One of the most perplexing aspects for many is the fact that they have no concrete physical existence. BitCoins are fixed but insubstantial: in principle, that is no stranger than having an email account but people are still used to thinking of currency as having at least some physicality. As it turns out, BitCoin payments allow you to line up your night’s dinner and drinks in advance, much as you might order a book on Amazon. “You can go on to our site, thebaggotinn.ie, select your drinks and set a table number, give us your details and make the payment that way,” says Chris. “We also have a tablet behind the bar with an app that allows people to make payments directly from their phone, instead of ordering in advance.”
Smartphone or tablet apps for carrying and transferring BitCoins are known, unsurprisingly as ‘wallets’ and they are the evidence that whatever the fate of BitCoin as an individual currency, eCurrencies are seemingly here to stay, just as personal communication tech is.
That said, Jeremy Allaire, CEO of Dublin-based company Circle Internet Finance, recently expressed the view that BitCoin is in an equivalent state of usefulness to the Internet as it was twenty years ago: promising but not quite there yet. Chris explains that so far it is mainly tech-savvy customers who are paying for their after-work drinks this way. “We have regulars who work in IT security, systems management, that type of thing. They’re very up on it obviously. Also some journalists, and another regular who is a car mechanic. Every day there are purchases in BitCoin here.”
As to whether BitCoin provides any particular advantages for businesses, Chris says “Basically, it’s another feather in our cap, another payment method for people who want to use it. From April, the Baggot Inn has hosted a BitCoin ATM, where people can download cash from their accounts onto their phone or tablet. In this bar at least, the future is now.”
Pictured above: Chris Healy from the Baggot Inn, Ireland’s first pub to accept BitCoin currency.
By Rúairí Conneely
So, BitCoin… what is it?
BitCoin is a new idea for most, and one that can be hard to wrap your head around if you have little knowledge of computation, let alone of finance and what determines the value of currency. Fortunately, NewsFour is here to help you, in straight-talking terms.
The controversy surrounding BitCoin at a political level is that it is a currency that is not issued by any central authority: no government, bank or institution determines how many BitCoins are out there. Instead, BitCoins are generated in batches by elaborate exercises in computer processing. Complex mathematical problems, which take a lot of processing time and energy to solve, are generated. Every solved problem generates up to 50 BitCoins over time. This generation process is known as mining. Currently, the advantage is with the most tech-savvy. An ordinary laptop set to work on a mining operation could conceivably work for two years without generating a coin. As such, networks of computers tend to share a given mining problem, chipping away at it a little at a time.
It’s possible to buy USB memory sticks that carry the BitCoin mining software. These are effectively plug and play: you insert them into your device, actuate the programme and let it work away in the background. Those who are less computer literate can simply purchase Bitcoins like any foreign currency. A good starting place is somewhere like www.howtobuybitcoins.info, which presents a simple directory of exchanges where BitCoins are available to buy through PayPal, among other media.
According to current estimates, as of April 2014, there are more than 12.5 million BitCoins in circulation. One BitCoin is estimated, at time of writing, to be worth €359.83.
