We’ve all heard the trope cryptocurrencers use to push their utopian dream on us; having the ability to buy your morning coffee with Bitcoin or some other cryptocurrency.
But I’ve been wondering where this incessant need to “caffeinate by cryptocurrency” came from? Is it really a good thing? I don’t even drink coffee, so what am I supposed to buy every morning with my cryptocurrency? Why is everyone so keen on buying coffee with cryptocurrency?
Hard Fork asked some leading industry names to get the skinny latte on this obnoxious meme that won’t go away.
It’s a metaphor
Let’s be honest, buying coffee is mundane, but it’s also quite an individual thing. Apparently, you can tell a lot about a person based on their coffee order. Not to mention lots of people seem incapable of functioning until they’ve had their morning cup.
Over 450 million cups of coffee are consumed in the US, every day. Coffee is a language a lot of people understand.
But using Bitcoin isn’t. So, maybe buying coffee with Bitcoin is the first step we all need to take to understand how cryptocurrency can work. Else we might all get left behind.
Economist, cryptoasset, and blockchain researcher, Garrick Hileman, put it simply: “…making a purchase most people identify with helps make a complex technology more tangible.”
Using cryptocurrency as payment in this most mundane of purchases makes it relatable. Buying coffee is simple, buying coffee with cryptocurrency should be too. One can hope.
Dominic Frisby, author of Bitcoin: The Future of Money?, told Hard Fork that buying coffee with cryptocurrency is worth doing to learn how it works and to get familiar with it.
“To get started, I [suggest] buying £20 [worth] of coins. Get a friend to do the same, practice sending each other small amounts of money, then meet up and buy a cup of coffee,” Frisby told Hard Fork.
That is, if you can find somewhere that actually accepts Bitcoin…
It’s not about the coffee
There’s more to it than the simplest answer, though. This meme is more of a thin veneer on top of a much bigger goal for cryptocurrency: mass adoption.
Creator of Litecoin, Charlie Lee, made a very direct argument. The more pervasive cryptocurrency is, the more use we have for it. The more daily opportunities we have to spend it, the closer we are to mass adoption.
“Cryptocurrency is censorship-resistant global sound money. So being able to pay someone on the other side of the world with no one being [able] to block you has tremendous value.” According to Lee, “once you have your money stored in crypto [sic], it’s important to be able to spend it everywhere.”
In other words, being able to pay for your coffee with cryptocurrency isn’t actually about purchasing the coffee. It’s about the political opportunity of having a true global currency, free from government control. But to get there, to truly obtain that social power, we have to be able to buy coffee (and any other everyday item for that matter) with cryptocurrency.
If we get to a point where we can buy coffee with Bitcoin, it’s logical to assume that most other things could also be bought with cryptocurrency. A world where anything could be bought with cryptocurrency, is a world that, by proxy, supports many of its other values such as pseudonymous online payments, privacy, and transparency.
How to make the coffee worth the grind
The issue is, buying coffee with crypto isn’t strictly the intended purpose of Bitcoin or cryptocurrency, so it’s not without its challenges.
“It’s true that buying coffee doesn’t really need to be done with crypto,” Lee told Hard Fork. “Bitcoin was invented to be cash for the internet – and buying cups of coffee in the real world is a deviation from the purpose,” added Frisby.
Indeed, Bitcoin was created to create a medium of web-based peer-to-peer value transaction. Taking it offline – and spending it at physical locations – is always going to be contradictory to its original purpose. After all, we have an anonymous payment system already… cash. So what’s wrong with that?
Hileman makes the point that our days of using cash might be numbered. As more payments are digitized, we may find ourselves in cashless societies, like those developing in Sweden, South Korea, and China.
Perhaps then, buying coffee with cryptocurrency is about so much more than the simple act it describes. Buying coffee with cryptocurrency is about preserving choice and freedom.
This is all before we even start thinking about how to scale the damn thing.
Bitcoin’s creator totally turns 44 today – happy birthday, Satoshi Nakamoto
Yo, Satoshi Nakamoto . Wherever (and whoever) you are, if you read this (for whatever reason): happy birthday. You deserve a celebration.
While we don’t really know much about Nakamoto, Bitcoin‘s pseudonymous creator, they were “thoughtful” enough to leave behind some fun “facts” for us to obsess over, like their supposed “birthday.”
Upon creation of their P2P Foundation online profile, Nakamoto‘s date of birth was listed as April 5, 1975 . It also claimed he was a man living in Japan, in which case — お誕生日おめでとうビットコイン先生!
Nakamoto, master of historic contextual references?
On this day in 1933, US president Franklin D. Roosevelt took advantage of a wartime “trading with the enemy” statute to outlaw ownership of gold coins, gold bullions, and even gold certificates by issuing Executive Order 6102 .
This led to the federal government effectively “confiscating” gold from every entity (individual and corporate) in exchange for an equivalent amount of fiat currency. Any hoarders found keeping reserves of gold or silver were punishable with a $10,000 fine and up to 10 years in prison.
This transfer was pitched as somehow necessary to combat the Depression. An article published by The New York Times the next day described how the move reflected Roosevelt’s previous warnings over the rise of gold hoarding, which was said to have stalled (and even negatively impacted) economic growth.
Austrian economics institute Mises wrote of the controversy : “Only later would they discover that they weren’t getting that gold back, and that the paper dollars they were being given in exchange would be devalued. Soon only foreign governments and central banks would be able to convert dollars into gold — and even that link to gold would be severed in 1971.”
If The Times ‘bailout’ headline was buried in Bitcoin‘s “genesis block” code to hint to the motivation behind Bitcoin‘s creation, Nakamoto‘s “birthday” easter egg must represent a historic catalyst for decentralized, sound money.
OK, it’s likely not Nakamoto’s birthday
As with most things Nakamoto, we should expect that today is not their real birthday. After all, Bitcoin is quite literally littered with “easter eggs” and in-jokes, and this reference is likely no different.
Perhaps the most well-known Bitcoin easter egg is buried in its software. Indeed, 2009’s Chancellor on brink of second bailout for banks headline from The Times can be found inside its code, which has led the phrase to become a mantra of Bitcoiners everywhere.
So, if it wasn’t already obvious, Nakamoto loves easter eggs.
With this in mind, remember Nakamoto‘s “birth year,” 1975? Well, president Gerald Ford repealed Roosevelt’s gold ban on December 31, 1974 , so it’s probable Nakamoto isn’t really 44-years-old today.
I say, let’s keep pretending anyway. Fuck it, happy birthday Nakamoto!
Did you know? Hard Fork has its own stage at TNW2019 , our tech conference in Amsterdam. Check it out .
Cryptocurrency-focused bank scores $10M from backers including Binance and Polychain Capital
The Malta-based cryptocurrency-focused Founders Bank has raised $10 million from leading investors including Binance and Polychain Capital and plans to open next year.
The bank , co-founded by Paula Pandolfino, also received backing from Carduus Asset Management, CoinDesk reports .
It’s not known how much each investor contributed to the round, but Pandolfino confirmed the bank would be looking to raise an additional $30 million in the future .
“Crypto [sic] will take over the world, and we need full banking services,” Pandolfino told the publication.
“We want to be that pillar of banking for the ecosystem to support how it gets done. If anything, [we’re learning] how to wean off traditional banking and getting crypto to be that platform,” she added.
The bank , which is still awaiting its European Union banking license, originally planned to raise funds with equity tokens, but this course of action was quickly abandoned to avoid any potential regulatory issues.
Malta wants to be a blockchain hub
Malta has been working hard to become a blockchain haven, to leverage the technology and to attract companies working in the space .
Known as “Blockchain Island,” the relatively small archipelago situated in the central Mediterranean between Sicily and the North African coast, passed three bills in July last year to establish a regulatory framework and push for innovation in the blockchain space .
The legislative win made Malta “the first world jurisdiction to provide legal certainty to this space ,” the country’s junior minister for financial services , digital economy and innovation, Silvio Schrembi, said on Twitter .
