[Following post by TDV Head Researcher Justin O'Connell]
Bitcoin has proven itself as an established payments system, with some of the world's most influential people commenting on its utility and innovation. Stephen Colbert called it "gold for nerds," and Joe Rogan has been fascinated by the technology, having Andreas Antonopoulos on as a guest to the Joe Rogan Experience twice now. Some political figures have expressed concerns over the currency's potential non-crime of "money laundering", but overall the sentiment has focused on the technology and its goundbreaking nature. And so its really no surprise that many companies have adopted bitcoin. Bitcoin has now surpassed Western Union in total transaction volume and looks set to pass Paypal this year.
Despite a year of detailed press coverage of bitcoin, tens of millions of dollars in capital investment, and a devoted userbase, eBay has been skeptical of the new innovation, as has Apple. But this has changed halfway through 2014 with the CEO of eBay himself admitting to owning some bitcoins and Apple allowing bitcoin wallet apps in its App Store.
EBAY/PAYPAL TO ACCEPT BITCOIN
Ebay's CEO John Donahoe hinted recently that the auction company, and so also its payments subsidiary, PayPal, will have to adapt and adopt bitcoin. Donahoe said on CNBC, “I think there’s no doubt digital currency is going to play an important role going forward, and at PayPal, we’re going to have to integrate digital currencies into our wallet.”
“I think you’ll see Bitcoin used in different use-cases, whether it’s a peer-to-peer use-case, a cross-border transaction, someone’s sending currency to someone else,” Donahoe told CNBC. “And over time, you’ll start to see it with some merchants accepting bitcoin.” Of course bitcoin is already beyond this point, further along than Donahoe has seemingly heretofore internalized. “I don’t know how big it will get how quickly,” Donahoe said. “But the underlying theme is that a digital currency is something we’re aware and something we should be paying attention to.”
"I think there are two sides of it, the investment side and the digital currency side," he continued on CNBC, which aired the interview on Thursday. "I'm more interested in the digital currency side about how you and I can exchange value seamlessly using technology."
The CNBC appearance is not Donahoe's first hint of bitcoin and PayPal's possible future together. The CEO of the e-commerce behemoth mentioned in a recent Q&A at the company's annual shareholder meeting that bitcoin is "a new, exciting and emerging technology" with lots of potential. The move would come after Overstock.com made the move, and recently reported over $1 million in bitcoin sales.
Overstock CEO Patrick Byrne told Wired, “We want a money that some government mandarin can’t just whisk into existence with a pen stroke.”
Bitcoin has gone up 75% in the last two months from under $400 to nearly $700 today on little to no mainstream media fanfare as it crashes up.
APPLE TO ALLOW BITCOIN APPS ON THE APP STORE
Apple awoke the ire of the bitcoin community when it suspended bitcoin wallet applications from the Apple App store earlier this year. Many people commented that this was probably because Apple had weighed the possibility of entering into the payments sphere. After all millennials have said they would bank somewhere they currently patronize not already offering banking services, like Google, Apple and Amazon.
But after having banned bitcoin apps, Apple came out this week and approved bitcoin and apps tied to wallet services for the virtual currency. It has given bitcoin its stamp of approval. Now bitcoiners won't smash their Apple products in YouTube videos.
Before Apple's announcement, popular bitcoin wallets like Blockchain.info, Coinbase and Gliph could not have their bitcoin wallets featured on the site overtly. This dark age is over. Apple's ban certainly created a barrier for adoption for people new to bitcoin, but now iPhones can be used to pay with bitcoin, a massive boost for the bitcoin community. iPhone users can now expand the bitcoin economy. Before Blockchain.info's app ban it had been downloaded 120,000 times, demonstrating how eager iPhone users are to utilize the bitcoin payment system.
DISH NOW LARGEST COMPANY TO ACCEPT BITCOIN
But, as if eBay and Apple hadn't stoked the bitcoin fire enough, Dish Network announced it will become the largest company that accepts bitcoin in the third quarter of 2014. Subscribers will be able to make one-time bitcoin payments at mydish.com. Dish is the No. 2 satellite company in the world. “Bitcoin is becoming the preferred way for some people to transact and we want to accommodate those individuals,” says Dish COO Bernie Han.
Dish's decision is “a large step forward in the growing momentum of customers paying companies in bitcoin for things we do everyday, like watching premium TV.” Dish's market cap is $27 billion, with 14 million subscribers and 35,000 employees.
AMAZON PATENTING BITCOIN RELATED TECHNOLOGY
In April the company said bitcoin was not on its radar, but within just four weeks Amazon was awarded a patent that mentions bitcoin. The patent centers around the idea of accepting payment for services without the services being tied to an account. The cloud computing patent will allow digital currencies as a payment for cloud computing services on Amazon Web Services (AWS). The patent mentions bitcoin:
“Various types of digital cash, electronic money or crypto-currency can be used, such as bitcoins provided by the Bitcoin P2P Currency System.”
IS GOOGLE NEXT?
YouTube recently announced its intention to introduce a tipping feature much like Vimeo's tipping jar. This creates an excellent opportunity for bitcoin to further demonstrate its power in the micropayments arena. Google has been positive in regards to bitcoin, as Google Director of Ideas Jared Cohen told Google Chairman Eric Schmidt: “I think it’s very obvious to all of us that cryptocurrencies are inevitable,” he said. Forbes reported that Google is looking into bitcoin integration, as Senior Vice President of Ads and Commerce Sridhar Ramaswamy said: “We are working in the payments team to figure out how to incorporate Bitcoin into our plans.” Google CEO Eric Schmidt has also commented positvely on bitcoin.
BITCOIN AND THE FUTURE
Bitcoin is an idea whose time has come. There is nothing all the unseen forces of history can do to turn back the tides of such a spontaneous solution to a very old problem. More than 72% of young people in the US and Canada would look to bank with a well-known, non-bank company. And no other near-futuristic payment system has a better team of marketers and innovators than does bitcoin. There is no way that centralized companies will be able to compete with a commons based "corporation" like bitcoin. In just ten years the world could be a radically transformed, freer place thanks to decentralized technologies like bitcoin.
The dominant banking system is pushing people away. The European Central Bank just announced negative interest rates on deposits. Soon savers in Europe won't only have the threat of losing all of their money in a bail-in looming over their head, but also the fact that their banks no longer pay them to hold onto their money. Rather, they pay the banks. Yet another reason why the traditional banking system is not long for this quickly changing world.
[Ed. Note: TDV has been at the forefront of this revolution in the The Dollar Vigilante (TDV) Newsletter. Subscribe today and be one of the first to receive our forthcoming Bitcoin Report, co-written by bitcoin's most prolific evangelist, Jeff Berwick, and Justin O'Connell.]
I'm willing to bet that bitcoin is the world's economic black swan event. The anarchic evolution of economics and finance has led to decentralized finance, and the world will soon never have been freer.