Australian startups eye Bitcoin opportunities

“Electronic payments should facilitate commerce, not stifle it with margin-eroding fees,” says Tomcar CEO.

Some startups see Bitcoin as a potential new revenue stream. Credit: [[xref:http://www.flickr.com/photos/105644709@N08/|Antana|Antana Flickr page]] via Flickr

Some startups see Bitcoin as a potential new revenue stream. Credit: [[xref:http://www.flickr.com/photos/105644709@N08/|Antana|Antana Flickr page]] via Flickr

A risky currency?

Bitcoin has not been without debate and controversy.

“We believe Bitcoin has huge potential as a payments protocol and have seen a few examples of Bitcoin fostering innovation in the financial services sector,” said Rui Rodrigues, investment manager of Tank Stream Ventures, a Sydney-based seed fund for early-stage startups.

“However, there is still considerable risk in these investments given the uncertainties around the regulatory environment.

“As countries legislate to protect consumers from illegal uses of the virtual currency — as they always did for traditional currencies — Bitcoin's potential could be limited.”

While acknowledging the debate, the startups who had adopted the currency said they are not concerned.

“The uninformed believe that Bitcoin is a risky form of currency, but I see it as the opposite,” said Brim.

“If you look at the recent management of fiat currency, it’s more risky. The supply is not fixed and it can be impacted significantly by government decision making.”

McIntyre agreed. “People say it relies on trust and if trust evaporates then the Bitcoin could disappear as well,” he said.

“However all currencies rely on trust, even the US Dollar and the fear of the US dollar collapsing, is driving Bitcoin's popularity,” said McIntyre.

VPNSecure’s McCulloch stressed that it’s not just hackers using digital currency, said McCulloch. “Everyday Joes are using Bitcoin.”

All three businesses said they believe Bitcoin has potential to grow into a major form of currency.

“Bitcoins have gone beyond being a fad to becoming a potential future currency,” said McIntyre.

“Just the way some people buy gold to hedge against fiat paper money, after the Cyprus banking crisis, Bitcoin has started to take off as people are losing trust in the current debt-based fractional reserve banking system and the Feds’ constant printing of paper money.”

Brim said today’s status quo for currency is not permanent.

“Currency has always been in a state of flux. There’s always a variety of currencies being used concurrently in any economy. Some of these currencies stay longer than others, some evaporate and new ones arrive.”

“While shark teeth and trading shells have long gone, precious metals still have significance relevance. I think that crypto-currency is just the new era of currency.”

McCulloch said he hopes Bitcoin will grow as a currency.

“It all depends on merchants like myself giving people the option,” he said. “While we are a small fish in the sea, accepting Bitcoin as a merchant is helping that currency grow.”

Follow Adam Bender on Twitter: @WatchAdam

Follow Techworld Australia on Twitter: @Techworld_AU

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