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Local small businesses among early adopters of Bitcoins

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Tech Corner

POSTED: Tuesday, December 17, 2013 - 5:00am

UPDATED: Tuesday, December 17, 2013 - 5:04am

High-tech investors have been excited recently about the rising value of Bitcoins. But they are not just a collectible for computer nerds. More and more, small businesses are getting in on the Bitcoin rush.

Bitcoins are a digital currency, similar to the Dollar or Peso, except consumers can never touch them. This year, their value rose from $13 each to more than $1,000, before settling around $700.

"As I saw the price starting to increase, and learning more about the Bitcoin, I decided it was a good purchase for me to make and a good investment for myself," James Christina recalled.

And he saw them as a good investment for Chateau Jacques, the apartment complex where he works as operations manager. It added the ability to accept rent payments in Bitcoins in November.

"I had been wanting to take credit cards for a few years now," Christina explained, "and with the fees that are associated with taking credit cards, they're very, you know, the interest is... it's very expensive to take credit cards."

Bitcoins were created by an anonymous computer programmer, and are not overseen by any government or central bank. Skeptics argue that, without proper monitoring or backing, they are too volatile to be a long-term solution. The rapid changes in value also make them more likely to be held as an investment vehicle than used for trade.

But the way they were designed, as pieces of complicated computer code, makes them very hard to counterfeit. And since there is a smaller supply of Bitcoins than typical currency, nobody offers credit, so users cannot go into debt.

"You're not worried about the person that's buying your product's credit card declining, or a check not going through," Christina added.

Bitcoins can be stored in a digital wallet, either on a computer or on a smartphone. Users can then set up accounts with various websites which make owning them and using them practical. "You can set it up to where, when the tenant pays their rent, you automatically, it will convert to cash and put it into your account," Christina said.

To this point, the majority of Bitcoin transaction have come as a result of people who want to buy something illegal over the internet, on sites such as The Silk Road. But for shoppers who want to use Bitcoins to make everyday purchases, there are websites with maps that shows which companies are Bitcoin-friendly.

"It opens you up to a new clientele," Christina claimed. "You know, if you take Bitcoins and another person has Bitcoins, that's a customer that you wouldn't have to begin with."

He believes that shoppers will gravitate to Bitcoins for their convenience, while businesses will accept them because they reduce the cost of operating. "(The) best thing about it is that it can be converted into currency the minute you take it, so therefore, it's just like a regular transaction. You're just not getting charged those credit card fees," he said, adding that the savings could be passed on to shoppers in the form of lower prices for goods and services.

While Bitcoins are high tech, the companies that accept them are not necessarily from tech-heavy industries. Aside from Chateau Jacques, the only other local business known to accept them is a small construction company from New Roads.

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