Bitcoins in Bali
Virtual currency or money known as crypto-currency is gaining traction around the world and is fast coming into the mainstream of online financial transactions. Digital money is one of the most important technical and economic innovations of our time and is used in myriad places worldwide. Some people consider it a goofy, geeky invention on the level of Monopoly money; some think it’s a Ponzi scheme; others realize the appeal of this uncomplicated, easy and instant digital money exchange for all manner of merchandise and services? Though there are more than 100 different kinds of digital currencies, the most well known and most widely established is Bitcoin. Bitcoin has mass appeal and gaining popularity as the money of choice for travelers, tourists and the digital nomad.
Recently a swank villa in Seminyak was sold for 800 Bitcoins, about USD 500,000 at the time of sale. Not a small transaction by any means. But you can also buy a vegan meal at Clear Café in Ubud, pay for membership services at Hubud or The Sanur Space, rent a bike, buy groceries, pay for legal services, etc.”
Behind the scenes, Bitcoin acts as a payment gateway and, due to Indonesian regulations, the restaurant automatically receives the corresponding Rupiah amount in their account. The main thing is that, for the customer, the ease and convenience of using Bitcoin as payment is not disturbed. Best of all, you never need to carry money, just a phone or tablet app that allows you to make payments from your virtual “wallet”.
The digital currency is a welcome alternative to credit cards for many small businesses. There is little risk in setting up a Bitcoin wallet for customers to directly transfer money into, and it beats the 3 percent merchant fee that vendors are charged for each credit card transaction. This will also allowing the 2 billion unbanked around the world to enter the global economy and contribute in ways that we can only dream of today.
Bitcoin payments for goods and services made locally here in Bali are facilitated by Bitcoin Indonesia, a locally owned and managed firm founded by Oscar Darmawan, a Jakarta businessman. Bitcoin Indonesia is Indonesia’s largest Bitcoin exchange and lobby group. It provides an easy and fast facility for local merchants to convert any amount of purchase to the current real time Bitcoin valuation and provides a secure means of transferring that exact same amount of Rupiah to the vendor’s bank.
Oscar has also created the BitIslands Project at the Bitcoin Information Center in Seminyak that is set up with the goal of turning Bali into a Bitcoin Paradise Island by signing up Bali businesses to accept Bitcoins. The people at Bitcoin Indonesia call it a social experiment, an attempt to convert a majority of merchants on Bali to accept Bitcoins. So far they have a fair number of members -and growing fast- ranging from cafes & restaurants, shops, legal, business and recreational services, tour operators, hotels & villas, even moneychangers and taxis. One of the goals of BitIsland is to support the Indonesia tourism industry by welcoming more Bitcoin spending tourists from all over the world to Bali. Ultimately, says Oscar, tourists who are used to Bitcoin in their own countries, can travel to Bali and would only need to bring Bitcoin.
So is it Bye-bye unyielding online banks, expensive money transfers and over-regulated Paypal?? Maybe not so soon, but it seems to be going that way.