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Payment technologist Eric Benz has been a busy guy since he first learned about Bitcoin.
Payment technologist Eric Benz has been a busy guy since he first learned about Bitcoin. His work within payments has taken him to ZipZap to, currently, GoCoin and Expresscoin.
We had a chance to speak with Benz this week.
CoinTelegraph: We would love to talk about GoCoin and Expresscoin, but first can you tell us about the UK Digital Currency Association and their current cooperation with the FCA?
Eric Benz: GoCoin and Expresscoin are two of the most exciting companies in Bitcoin right now.
Leveraging my network and background in payments, I have been able to provide a unique dimension to both businesses and assist in building their international roadmap. For me, stepping into the world of Bitcoin was quite an easy transition. I have been involved with payment technologies for the past decade, working for both financial institutions and merchants across the world. Having the opportunity these past couple of years to work with many Bitcoin businesses has provided another dimension not only to my career but also in my perception and understanding of finance.
Digital currency fascinates me, and it has nothing to do with the price but everything to do with the utility. The programmable features Bitcoin and other digital currencies offer captivates my imagination and shows me exactly how Bitcoin will be the true driving factor for financial innovation. Most of what we see right now in 2014 is pre-HTTP. The year is 1995 again, and we have yet to provide people an easy way to navigate the internet and use email to communicate with people. Bitcoin is at its infancy stage, and the technology is still being built.
In light of it being very early days, it is the responsibility of companies in this ecosystem to create as much public awareness as possible. It is this awareness generated that will drive adoption and help people understand and learn to appreciate just how important it is now and for years to come.
Being that London has been my home now for over 10 years, I wanted to make sure that I gave Bitcoin a voice and set London as my stage. The UK Digital Currency Association (UKDCA) is a non-profit organisation that was established to inform public debate, influence the design of jobs and growth-friendly policy and regulation for the United Kingdom, to educate the public and to provide a fact-based source of media comment as peer-to-peer digital currency technologies, such as Bitcoin, gain wider attention.
Bitcoin has already spawned many alternative currency types and complementary technologies that are also based upon the novel concept of the blockchain. The UKDCA believes that such innovations will continue to emerge as a wider digital currency ecosystem evolves in the years to come, and we aim encompass all relevant future developments as and when the landscape dictates.
We had a huge win with Her Majesty’s Revenue & Customs (HMRC) here, helping to educate and get them to overturn their Bitcoin tax decision, which would have halted innovation and forced companies offshore.
In regards to the FCA;
“The FCA is taking a cautious approach to digital currencies, and have told the UKDCA that it doesn’t believe that Bitcoin businesses currently fall within its regulatory remit. However, they do now seem willing to listen, and have asked the DCA to provide a submission explaining how we believe they should be overseeing digital currency businesses.“The UKDCA is currently seeking input on this from its members, and based on initial feedback is likely to suggest that light-touch regulation is appropriate, providing much-needed legitimacy to digital currencies, without stifling a young and rapidly expanding industry.“The UKDCA took to take a similar approach when lobbying the HMRC on changes to the taxation of digital currencies in the UK. Here, the UKDCA brought together Bitcoin businesses and users to explain to HMRC the technology behind digital currencies and how it is applied, in order to help them make informed policy decisions.”— Tom Robinson, Interim Board Member at UKDCA
“The FCA is taking a cautious approach to digital currencies, and have told the UKDCA that it doesn’t believe that Bitcoin businesses currently fall within its regulatory remit. However, they do now seem willing to listen, and have asked the DCA to provide a submission explaining how we believe they should be overseeing digital currency businesses.
“The UKDCA is currently seeking input on this from its members, and based on initial feedback is likely to suggest that light-touch regulation is appropriate, providing much-needed legitimacy to digital currencies, without stifling a young and rapidly expanding industry.
“The UKDCA took to take a similar approach when lobbying the HMRC on changes to the taxation of digital currencies in the UK. Here, the UKDCA brought together Bitcoin businesses and users to explain to HMRC the technology behind digital currencies and how it is applied, in order to help them make informed policy decisions.”
— Tom Robinson, Interim Board Member at UKDCA
CT: Can you tell us about developments in the Isle of Man? What effect do you imagine the government’s intention to develop a regulatory framework for cryptocurrency businesses will have?
EB: I have spent years developing solutions in banking, iGaming, and retail as a payment technologist. Towards the start of my career when iGaming was just hitting the scene, it was close to impossible to actually acquire banking facilities. Banks at this time were so skeptical of online gambling companies, and getting an account in the early days was a huge deal.
Fast forward less than a decade later, and we are experiencing the exact same concerns regarding Bitcoin. With the right amount of lobbying and education, Bitcoin adoption will follow a similar path. Legacy banks won’t provide accounts to Bitcoin businesses not because they don’t like Bitcoin. The real reason is it scares them on many different levels.
As a result of my experience within the financial services sector, I felt obligated to somehow find banking facilities not only for my company but for any digital currency business. I immediately decided to seek out a friendly jurisdiction that would would not only provide banking facilities but promote the use and adoption of the Bitcoin technology.
I want to acknowledge Paul Davis from Counting House Ltd., who I spoke to over a year ago regarding Bitcoin banking. Paul has been around the financial services space for many years, and I knew if anyone in this world could acquire banking facilities it would be him.
When we first discussed Bitcoin and what I was after, he could have easily said “No” like everyone else but instead did the impossible. He not only found exceptional banking facilities but a jurisdiction for companies to showcase their technology and operate without fear of being shut down.
This Bitcoin-friendly jurisdiction is The Isle of Man, a beautiful, tiny island in the middle of the Irish Sea. It is one of the world’s premiere online gambling jurisdictions and has a very modern attitude towards technology. This has been made very clear to the public recently with their official statement to establish safeguards to protect users of digital currencies, such as Bitcoin.
“This Bitcoin-friendly jurisdiction is The Isle of Man, a beautiful, tiny island in the middle of the Irish Sea. It is one of the world’s premiere online gambling jurisdictions and has a very modern attitude towards technology.”
The Department of Economic Development plans to build an environment to allow businesses to grow in this ‘rapidly’ emerging sector. They also recognize both the risks and opportunities presented by digital currencies and are embracing all companies who meet the necessary standards as long as they agree to uphold the reputation of the Island as a financial center.
CT: Can you tell us about the 15-plus companies you’ve helped get set up on the island? Any of your companies setting up there?
EB: Over the past year now, I have sent Paul close to around 20 or more digital currency-related companies with more getting in touch everyday. From my understanding, over 60 companies are currently looking at setting up operations in the Isle of Man. These businesses range from exchanges, payment service providers, mining companies, etc.
The impact the government’s decision will have on Bitcoin-related business will be immense. We finally have a sense of legitimacy being put behind Bitcoin, and this alone will allow Bitcoin-related businesses to flourish. Paul Davis, along with other Isle of Man businesses, have also recently decided to set up a special digital currency incubator open to all qualifying businesses. According to Paul, there has already been an influx of inquiries to the incubator’s professional service providers.
His firm, Counting House, is signing up one or two new clients a week who are specifically focused on digital currency technology and services.
“This is the biggest opportunity for the Isle of Man since gaming moved here,” Paul says. “Bitcoin may be the digital currency of the future or it may not, but we are the ideal place for the technology to call home.”
Other jurisdictions are looking at following what the Isle of Man government has done. The more jurisdictions and governments we have supporting the adoption of Bitcoin and digital currencies as a whole, the better the entire ecosystem becomes.
GoCoin and Expresscoin both are in process of being set up in the Isle of Man. These businesses in particular are perfect examples of exactly what Bitcoin needs: consumer-facing products and services.
For Bitcoin and digital currencies to flourish, it has be put in the hands of the people and integrated into the businesses that in turn service those people. Both GoCoin and Expresscoin are two of the best companies doing exactly that, and I intend to do whatever is necessary in developing each of their respected global footprints.
CT: Tell us about GoCoin. What plans for the near term are in the works? What will the company be doing with the $1.5 million in series A funding announced at the end of March?
EB: Being able to offer merchants a way to accept Bitcoin and other digital currencies is exactly what GoCoin does so brilliantly, and being a part of this amazing team is an honour. Since our series A raise, we have been working around the clock building our merchant services and growing our team and coverage to more international markets.
I am so proud with what we have been able to do these past few months! I think we have a few very big cards up our sleeve, and the moment we pull them out it will be game changing. We are on a mission at GoCoin to support and further advance the ways in which this marketplace is going to be developed.
With the demand for the product heating up, we are currently in the process of setting up a London office, which will act as our main international hub. I can’t really speak in depth at the services we will be launching and the types of merchants we are currently working with. What I can say though is that I might consider buying Bitcoin!
CT: Tell us about your work with Expresscoin. You said previously that you believe this company is going to make buying cryptocurrency easy and accessible to people around the world. How so?
EB: Establishing and making the marketplace what it is is only half the battle, though. The other half is actually giving consumers a way in which to buy Bitcoin. Expresscoin is by far the easiest, quickest and most secure way to buy Bitcoin in the US. Many people do not know this, but they are the second largest exchange behind Coinbase in the States, and I know why.
For a consumer, it’s not only about speed but also about financial services. You have an enormous amount of people in America who are cash-preferred, and a lot of these cash-preferred consumers are also unbanked. Expresscoin is more than just Coinbase for the unbanked. Its exactly what it says it is, express coin.
We are looking to do a big launch in the UK with a payment network here and then further roll out the Expresscoin services throughout the EU, with further international expansion plans slated for 2015. Building the rails into the legacy payment systems is high on our priority list, and we intend both the purchase and sale of Bitcoin to become as easy as topping up your mobile phone. We will look to roll out more international payment options in the coming months including credit card capabilities.
Will the value of Bitcoin remain? Will the interest die if the price crashes? In my honest opinion, I have to say I do not know if the price of Bitcoin will sustain itself long term or if it will go to zero.
What I can say in confidence, though, is that the protocol and the concepts Bitcoin has given birth to something that will be around for years to come. Currency is merely the first application to Bitcoin, just like email was the first application to the Internet. The services, technologies, and companies that will build themselves on top of the Bitcoin protocol will change the face of industries worldwide. Having the opportunity to work full time in Bitcoin and be a part of these companies that will do precisely this is exactly what continues to drive me each and every day.
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