BC Business
Bitcoiniacs has five Robocoin machines on order
Based in a non-descript ground floor office just off Burrard, Bitcoiniacs is the vanguard of a wave of local businesses courting early adopters and enthusiasts looking to make transactions in Bitcoin as easy as using Visa, MasterCard or cash.
Already a physical exchange for Bitcoin, the company’s founder Mitchell Demeter plans on setting up an ATM this October, catering to a growing base of Bitcoin users in and around the city.
It’s good news for local Bitcoin enthusiasts like Mike Yeung.
“It will allow people to get the coins a lot easier,” says Yeung, who runs a Bitcoin club at Simon Fraser University. So far Yeung has used the algorithmically generated currency at local cafés and to buy wine
The kiosk will ask users for a Bitcoin wallet identifier, in the form of a QR code on the user’s smart phone. Canadian currency is deposited in the machine, and after deducting a transaction fee, the digital wallet is credited in Bitcoin. Manufactured by Las Vegas-based RoboCoin, the machines go for $18,500 each.
“We’re going to have it in a public space,” says Mitchell Demeter, the 27-year old owner of Bitcoiniacs, who has yet to finalize a location for the kiosk.
He has four more on order, expected to come by the end this year, which he’s hoping to install in other major Canadian city centers, including Calgary, Toronto, Montreal and Ottawa.
For Demeter, Bitcoin banking is a hobby that got a bit out of hand. After developing an interest in January trading and selling Bitcoin among friends, an unrelenting increase in demand gave Demeter the impetus to open up a storefront. Like a currency exchange, Bitcoiniacs charges a 3 to 7 per cent transaction fee for clientele who wish to buy or sell Bitcoin. The ATM will charge a flat 3 per cent fee.
But critics have expressed concern over the instability in Bitcoin’s value and it’s use in online black market exchanges, like Silk Road, for the sale of drugs and other illegal activities. Yeung believes that selective media coverage has exacerbated those perceptions.
As for its legal status, a U.S. judge ruled last month that the currency, first established in 2009, is a real currency, and thus subject to the same laws, while a Texas court declared it subject to U.S. securities regulations.
But unlike it’s American counterpart, the Canada’s financial regulator, FINTRAC, does not regulate Bitcoin.
Demeter believes that less stringent regulations on our side of the border will make Vancouver a hub for Bitcoin startups. “A lot of businesses are coming up to Canada”, says Demeter. Easy access to Bitcoin through an ATM might make add another incentive.