The world has moved into online spending with the use of new payment platforms like ‘tap and pay.’ Despite this, we are still largely using cash and credit cards to pay our bills.
But digital currency is borderless and it’s shaping to be the next platform in the payments war. Bitcoin and other crypto currencies threaten to provide the lowest cost and fastest platform.
Australians are now using this digital currency through companies like Brisbane firm, The Living Room of Satoshi, which offers free BPay facilities in Bitcoin for consumers.
CIO contributor, David Gee asked The Living Room of Satoshi’s founder, Daniel Alexiuc, about the small part his company is playing in the digital currency landscape.
The Living Room of Satoshi founder, Daniel Alexiuc
CIO: The Living Room of Satoshi is a great name. What was the inspiration behind it?
Alexiuc: The story of Satoshi Nakamoto is an inspiring and romantic one, and has surely contributed to Bitcoin’s success so far. He’s a mysterious and reclusive genius, who had the forethought to create something brilliant, release it to the world, and disappear completely and accomplish it anonymously – no small feat in the internet age.
But I like to imagine that Satoshi still kicks back in his living room at the end of the day and pays his electricity bill just like the rest of us – hence “Living Room of Satoshi”.
CIO: Your platform permits people to pay their bills and day-to-day items with Bitcoin. What has attracted them to your service?
Alexiuc: All of our customers find Bitcoin a fast, secure and convenient way to pay bills. You can see from our graphs page that our customers are paying all sorts of everyday bills, from toll road charges to tax bills. Many use Living Room of Satoshi to pay off their credit cards with Bitcoin, which opens up an even greater range of places to spend Bitcoin.
What this means is that I can pay my utilities invoice with Bitcoin through this facility, even though that is not an officially supported mechanism of this organisation. This all happens within our interchange. Some of our customers are also paid in Bitcoin, so our service allows them to live without ever using Australian currency.
CIO: Your business was recently suspended for a few months due to regulatory uncertainty but now you’re back. What lessons have you learned in the short history of this company?
Alexiuc: Don’t let fears about regulation stop you from developing innovative solutions because the regulations might change anyway.
Bitcoin is a nascent and unprecedented technology that regulators are still struggling to comprehend. The software developers in Australia need to continue to innovate and demonstrate the utility of Bitcoin, which will in turn shape regulation.
CIO: What will prevent Bitcoin from expanding more broadly in the future? What do you see as the biggest barriers right now to the success of crypto currencies?
Alexiuc: In Australia, by far the biggest impediment to the adoption of Bitcoin is the recent GST ruling on Bitcoin. This was also identified by international expert Andreas Antonopoulos at the Australian Bitcoin Senate hearing.
The GST ruling means it is very difficult for any Australian-based company to embrace Bitcoin, and this is hindering adoption. Our own Satoshi Pay biller solution, a competitor to BPAY, cannot be launched until we either relocate overseas, or the ruling is changed.
CIO: Every hour, Coinmap is updated with new players embracing Bitcoin and Blockchain. In your opinion, what’s going to be the tipping point?
Alexiuc: I think the tipping point will come when it is easy for workers to be paid in Bitcoin – again this is something being hindered by the GST ruling.
There are lots of places now to spend Bitcoin, and you can pay all your bills with Living Room of Satoshi, but to have a healthy ecosystem, it needs to be easy for businesses to transact completely in Bitcoin - to sell products in Bitcoin, pay their staff in Bitcoin and purchase supplies in Bitcoin.
CIO: In which country is Bitcoin most accepted? Do you know why?
Alexiuc: Bitcoin is accepted everywhere the internet is accepted – it’s one of those pervasive technologies that is available everywhere and to everybody, and why it is such a revolution in payments.
In terms of supporting business though, I think that the traditional FinTech hubs of London, Hong Kong and Singapore seem to be attracting the most innovators away from Australia right now. They have so far adopted a more sensible wait-and-see approach to regulation and have avoided stifling innovators.
CIO: What APIs are you seeking to establish to allow further development and growth?
Alexiuc: Actually our API is built on the open and widespread REST standard, and isn’t tied to any particular company. We simply use Apiary for our documentation, something akin to a Wikipedia for software developers.
Our API allows other programs and websites to pay bills using Bitcoin – no humans required. For example, you could set up a system that pays your health insurance with Bitcoin automatically each month.
CIO: As a startup, it is a hard road with many bumps. What's the one piece of advice you would give to new entrants into this space?
Alexiuc: I agree with Shark Tank rhetoric ‘ideas are nothing, execution is everything’.
Don’t get wedded to your idea, it probably isn’t that great. Always be prepared to pivot – this is my sixth start-up, some raging successes, and some dramatic failures. But Bitcoin is in my opinion the most innovative technology since the internet, and there is still heaps of work to be done in this space.
CIO: If you could actually meet the fabled Satoshi or Bitcoin’s inventor, what would you ask him or her?
Alexiuc: Can I buy you a beer?
David Gee is the former CIO of CUA where he recently completed a core banking transformation. He has more than 18 years' experience as a CIO, and was also previously director at KPMG Consulting. Connect with David on LinkedIn.