Are bitcoins a temporary trend or the future of currency?
Bryce Kander is betting on the latter, with the Red Deer Realtor setting up a website (btcestate.com) through which investment properties can be purchased using digital cash. A member of Realty Executives Red Deer, Kander made headlines in July when he advertised that bitcoins would be accepted as payment for a Gasoline Alley acreage he’d listed for his mother.
“I absolutely love it,” said Kander of the bitcoin system, which he said is being adopted by an increasing number of retailers and other businesses.
“Every day I’m seeing new stuff online.
“More and more are joining every day, it seems.”
Drew Glover and Matthew Haddon are also proponents. They’re co-CEOs of Edmonton’s BitNational Inc., which on Wednesday installed a Robocoin kiosk in West Edmonton Mall.
One of about 25 bitcoin exchange machines in the world, it allows users to convert cash into bitcoins, and the reverse.
“It’s gone really well,” said Glover, adding that BitNational’s goal is to set up other exchange machines — perhaps even in Red Deer.
“That is a possibility, if it does catch on the way we anticipate.”
The large volume of people at West Edmonton Mall made it an ideal starting point, he said.
“That’s part of the adoption goal is to bring it to the masses; having this in centralized locations that are heavily populated.”
Paritosh Ghosh, an economics instructor at Red Deer College and the current chair of RDC’s Humanities and Social Sciences Department, said widespread adoption of bitcoins could be challenging. The system — which relies on computer cryptography to control the creation and transfer of virtual money — is not understood by many.
But Glover believes bitcoins’ advantages will persuade people to convert.
“It’s a peer-to-peer network that enables instance transfer anywhere in the global market,” he said. “I could send a million dollars, if I had it, to my friend in India, China, anywhere in the world — instantly.”
Bank transfer fees and other costs are avoided, he added, and bitcoins can be easily and safely stored in a cellphone or other “digital wallets.”
Ghosh pointed to other drawbacks related to bitcoin usage. Unlike most currencies, it’s not backed by a central bank, like the Bank of Canada.
“That makes a currency work,” he said. “We have confidence.”
As an investment, which many consider bitcoins to be, the system lacks a regulatory body like those governing equity markets.
And there are concerns it provides an easy way for criminals to launder money.
Ghosh concedes, however, that the hurdles aren’t a lot different from those that paper and coin currencies faced centuries ago as they evolved.
“There was no regulator, no insuring body that guaranteed that this was $20 or $5 or whatever.”
The difference then, he said, was that there weren’t alternatives — unlike today.
Ghosh, who has a PhD in economics, said experts’ opinions are mixed about the long-term viability of bitcoins.
“Some economists believe that eventually the price will be close to zero for each of the bitcoins. Some other economists believe . . . it will go up.”
Kander is optimistic about the future of his bitcoin-focused website, which he expects to have operational in about a month and a half. He believes it will open local real estate investment opportunities to buyers everywhere.
“Why don’t we market this to the world, instead of just Alberta?”