can use Bitcoin to buy virtually anything,” an oft-quoted cliché goes. But is
it true? Forbes’ Kashmir Hill has returned to find out if Bitcoin really can
support your entire life in 2014.
Hill originally held an experiment to live off Bitcoin for one week last year, when the price of BTC was around $130. Now it is worth almost four times that figure, which gave Hill, with her six remaining bitcoins, a lot more to play with.
No more “Bit what?”
It is worth noting that Hill is based in San Francisco, where there is a relative plentitude of Bitcoin outlets compared to more remote locations, which gave her a distinct advantage. California has furthermore shown a fairly liberal attitude to consumer-level Bitcoin innovation, in contrast to other states such as Ohio, which has banned alcohol sales on Cleveland’s newly opened Bitcoin Boulevard.
Hill’s experience on the first day of this year’s experiment gave both an insight into changing trends regarding Bitcoin and a demonstration of the challenges novice users could find themselves up against when trying it out.
When seeking a repair for her bicycle, “[the mechanic’s] eyes didn’t goggle at the mention of Bitcoin as they did when I went into a bike shop the year before, when a clerk looked at me like I was crazy and said ‘Bit what?’” she writes.
Nevertheless, she still needed to pay cash, which highlights the obvious yet unavoidable fact that Bitcoin’s availability as a payment method is insufficient for consumers’ unexpected needs. Indeed, this is most likely the case even in those locations with the most widespread acceptance.
When purchasing items from a grocery stand, the transaction took a total of 67 minutes to be confirmed as Hill did not attach a transaction fee. “I couldn’t help but wonder if this was a breakdown in communication between Coinbase and Blockchain’s services,” she writes before the aforementioned explanation was suggested to her by a colleague.
Such a conclusion could well be drawn by many others, especially those with limited knowledge of the transaction process, which in turn could lead to distrust of Bitcoin’s major names and frustration with the process in general.
Hill’s relatively bad luck was reversed by a chance discovery of Gyft, a website selling gift certificates for a range of merchants wide enough to cover most of one’s needs and which also accepts payment in Bitcoin. “It’s so easy that I start binging,” she says, purchasing a range of products and services including taxis and entertainment.
In Hill’s subsequent conversation with CEO Vinny Lingham, he reveals that Gyft “had $100,000 worth of Bitcoin sales its first month of accepting it in May 2013,” that “they now have monthly sales of over $1 million in Bitcoin, and that it doubled in November and December when Bitcoin’s value surged.”
This underlines a disparity between online support and the still relatively slow uptake on the ground, and a Bitcoin “community,” albeit rapidly accumulating new users, still set apart from the mainstream consumers by virtue of its technical inquisitiveness.
While the results of Hill’s full article are perhaps exactly as is to be expected, it is interesting nonetheless that in spite of Bitcoin’s ups and downs, both economically and in terms of public relations, the upward trend it exhibits is indisputable.