Last week was a week of announcements for bitcoin. PayPal announced they will start accepting bitcoin payments, IBM/Samsung quietly announced that they are working on a blockchain/Internet of Things project, and Apple announced a credit card partnership to form Apple Pay, which cuts out bitcoin all together. However, the move towards mobile wallets should provide a step in the right direction to transition consumers to digital currencies.
Click on the headlines below for links to the full stories.
Summary of Government Related Initiatives:
TeraExchange created the first financial product based on Bitcoin that has the blessing of US federal regulators. The product is a derivative that allows customers to protect their Bitcoin holdings’ USD value. Plans for the swap were first announced in March, and it took over half a year for TeraExchange to get approval from the Commodity Futures Trading Commission. As part of their product, TeraExchange has formed a Tera Bitcoin Price Index.
San Francisco based Coinbase joined the Chamber of Digital Commerce, Xapo, Circle, and many other champions of Bitcoin this week by submitting comments to NYDFS regarding the proposed BitLicense regulations. While Coinbase applauded the efforts of NYDFS, they remarked “the proposed BitLicense falls short of its stated goals of balancing customer protection and rooting out illegal activity, while encouraging innovation.” Coinbase is one of the largest Bitcoin services for both users and merchants.
The Bank of England recently published a quarterly report on the payment innovations present in Bitcoin and other digital currencies. Specifically, the United Kingdom’s central bank recognized that the distributed ledger is a groundbreaking innovation in the realm of payments. Recognizing that most financial assets already exist in digital form, the bank report admits that digital currencies are both more robust and more efficient. Previously in the UK, Her Majesty’s Revenue Service has clarified the Value-added Tax situation in favor of Bitcoin users across the country.
Summary of Industry Initiatives:
Just today, United Way announced that they will start accepting bitcoin donations for United Way’s Innovation Fund via Coinbase. This makes United Way the largest charity to accept bitcoin.
Braintree, a subsidiary of eBay that processes credit card payments, announced at TechCrunch Disrupt last week that they have integrated bitcoin payments. Merchants who use Braintree’s v.zero SDK will be able to accept bitcoin in the coming months via Coinbase. PayPal, also a subsidiary of eBay, released a video on youtube stating that users would be able to “spend bitcoin with a tap”. EBay and its subsidiaries have been hinting that they have been working at this, but the video provides confirmation.
IBM’s Paul Brody told GIGAOM that IBM and Samsung are working together to build a new technology called Adept. Adept would combine blockchain technology, BitTorrent, and a secure messaging protocol called telehash. Adept is not an official IBM product, but Brody said he hopes it will be ready for the Consumer Electronics Show (CES) in January, and that it solves some economic and technical issues associated with the Internet of Things.
Last week Apple introduced Apple Pay “Your Wallet Without The Wallet”. Apple Pay utilizes the iPhone 6 and iPhone 6 Plus’ near field communication (NFC) technology for contactless payments. Apple Pay offers more anonymity and security than using your credit card because each purchase uses a unique transaction-specific security code and all your information is stored on a separate encrypted chip called the Secure Element. Apple also says that it does not save any of your transaction information.
While Apple has decided to play it safe and only partner with established and regulated credit card companies, bitcoin debit cards, such as Xapo, might be able to be used with Apple Pay. Apple Pay is targeted for mainstream consumers and is a step forward with transitioning consumers to mobile wallets.
Coinbase the online provider for bitcoin services such as buying, selling, storing and merchant processing, has expanded into select European Countries. The countries include Italy, Spain, France, Belgium, the Netherlands, Austria, Cyprus, Finland, Greece, Latvia, Malta, Portugal, and Slovakia. The expansion is part of an open beta, which means customers will be limited to 500 euros buy and sell limits per day. Coinbase believes this will help accelerate the 1.6 million customers and 36,000 merchants who are already signed up to use their services.
Peter Thiel, co-founder of PayPal and famed Venture Capitalist investor hosted a Reddit “Ask Me Anything.” When asked if he thought Bitcoin will replace the current financial system he stated, that PayPal’s original goal was to create a “new world currency” and that “ Bitcoin seems to have created a new currency (at least on the level of speculation)”. However, “I will become more bullish on Bitcoin when I see the payment volume of Bitcoin really increase.”
While Thiel expressed dissatisfaction with the current volume of bitcoin transactions, his own Venture Capital investments include bitcoin companies such as BitPay.
CNN Money columnist Jose Pagliery published a book on Bitcoin, called Bitcoin and the Future of Money. The book covers the creation of Bitcoin, how Bitcoin operates, and the impact of Bitcoin as a technology. Jose Pagliery also includes perspectives from Ron Paul, regulators, and setbacks the technology has faced, including the online bazaar, Silk Road that sold illegal products in bitcoin. The book is available for purchase on Triumphbooks.com in US dollars and bitcoin.
Gem, a Bitcoin startup, announced a new API for Bitcoin applications developers to make it easier to encrypt and backup user’s Bitcoins. The API will utilize multisignature technology, and adds another layer of security for safekeeping one’s Bitcoins. Unlike services similar to Coinbase, Gem does not store your Bitcoin, rather it offers the technology to encrypt your own Bitcoin wallet. Developers interested in developing a Bitcoin app need to be well versed in cryptography, and using Gem’s API alleviates that need by providing a more secure platform for making apps. Gem has raised $2 million in startup funding, and is currently in the beta stage of development.
Tweet of the Week:
Our Tweet of the week comes from Nic Cary, CEO of Blockchain, discussing Apple Pay.
— Nic Cary (@niccary) September 9, 2014
Quote of the Week:
“I’m really proud to be able to say that we’re going to work with Samsung to have a prototype physical network based on this technology — ready (we hope) in time for CES in January.”
IBM’s Paul Broady discussing IBM’s new blockchain based product they’re building with Samsung. h/t: TBI
Like it? Send a tip to the Boring Bitcoin Address: 12LFcP4HgHMecskwLQXaRKJuHR21xgvQm8