Now that illicit websites selling drugs are getting shut down left and right, what can one buy with all of those saved up bitcoins? How about on a Walt Wit or Philadelphia Pale Ale? Philadelphia Brewing Company announced last month that they are accepting the open source currency bitcoin, and are the first brewery to do so. The choice to add bitcoin as an acceptable form of payment was apparently an easy one to make, according to owner Nancy Barton, and the decision made by the company was almost instantaneous.
Bitcoin has been in the news a lot recently, mostly mentioned in articles surrounding websites that offer items Amazon doesn’t, and by now you probably understand that it is a form of currency. If you are like me, however, you may not really know how bitcoin works exactly or where it came from.
Bitcoin was started four years ago and is essentially a program that allows you to own data that has monetary value. Bitcoins are created when users maintaining a vast network of the fiscal bitcoin transactions get a dividend for doing so. Rather than the fee be a percentage, like a standard credit card company would get, a flat rate of 25 completely new bitcoins separate from the transaction bitcoins is paid to the person who maintains a transaction, called a block, and adds it to a public record, called the block chain. Each bitcoin is unique, having both a public “address” and a private “key”.
Bitcoin is a way to digitize the hard currency that we carry around everyday. Previous attempts suffered from “double-spending” or the fact that you could simply copy and paste former digital currencies thus undermining its value.
It has seen a lot of negative publicity lately, especially the fact that its current value seems to change wildly and swing from extremes. One bitcoin could be worth $1 or $1000, or at least has been over the course of its existance. Currently it sits somewhere in the middle, but different exchanges peg it at different values. This does not seem to bother Philadelphia Brewing Company, or other establishments for that matter. Bitcoin may seem like pixie dust, but more and more real businesses are hopping on the Bitcoin bandwagon as it offers real advantages. Companies loath transaction fees implemented by credit card companies, and Bitcoin eliminates them. And as it gains legitimacy, more and more people may see themselves as wanting to spend them somewhere, much like my generation usually only carries plastic. Philadelphia Brewing Company wants to be on the ground floor of the service it can offer patrons who want to order a case of their beer.
Several novel products got their start from being first adopted by seedy businesses. Look at VHS. So if above board companies like Philadelphia Brewing Company lend the idea some credence, maybe it can actually flourish. Until then, that symbol you see at PBC besides the Visa and Mastercard logos isn’t Euros, it’s Bitcoin.