In 2010 and 2011, a lot of geeks acquired something called bitcoin. It’s a novel form of currency that breaks all the rules you know and redefines currency as we know it. In 2011, this currency was worth mid-single digits per “coin”. Today, one such coin is worth upwards of a thousand US dollars, and newly-minted millionaire geeks are hungry for toys – but almost nobody’s selling.
A lot of geeks are sitting on a ton of money, and they’ve now had the value of that money appreciate enough to spend 1% of that wealth to cross off pretty much every item on their toy wishlists all at once, and pretend it’s Christmas.
Way too few stores are selling. You have a bunch of geek multimillionaires out there who are hungry – no, famished – for toys, and all the toy stores tell them to take a hike, because they won’t accept the bitcoin worth millions and millions today.
In a way, that’s understandable. Any deviation from an established workflow at any business – retail included – means a ton of work, and in particular, you don’t mess around with your payment workflows. And accepting a new currency into a business? That’s not just a ton of work, that’s a ton of risk, too, even in the face of an underserved multimillionaire market.
The thing is, the money is real. You can accept it much easier than you accept credit cards, and at a much lower rate, getting your usual central-bank money deposited into your bank account the next day (instead of the next week, or next month, as is the case with credit cards). Also, there are no chargebacks – the currency and its payment system is designed to not have any. Bitpay is one company processing such payments, depositing the next day, and charging 1% per transaction or USD 30 per month and 0% per transaction. What’s your current payment processor charging for access to multimillionaire markets?
Again, the money is real. It’s just an uncommon type of money, but there are middlemen who solve that problem for access to this market.
Yesterday, there was news that you can now buy a lot of geek-related stuff in the United States with bitcoin, from the electronics store TigerDirect. That’s a marked improvement just over the course of a day – each first-mover has a chance to capture the market for their niche, but this market segment is still ridiculously underserved. First, geeks don’t just exist in the United States – I’m located in Europe and I will want to buy from stores located on the inside of European Union customs walls, because I hate customs red tape and 30-percent surcharges that happen otherwise. Second, what do geeks want?
I’m looking for servers right now, just to look at myself. I’m sick and tired of the noise from my Dell PowerEdges, having put them on the balcony to get rid of the noise, and I want 128-meg or 256-meg octocore rackmount servers that don’t sound a whisper, silenced by enormous Noctua heatsinks or similar. This is off-trail stuff that still isn’t too odd to imagine somebody would want. To illustrate, I tried asking EndPCNoise.com if they accepted bitcoin for building such a server and didn’t even get a reply. That surprises me, and is illustrative of the situation at large.
Also, it goes beyond technical toys. Way so. Multimillionaire geeks with bitcoin are human beings and have just as diverse fields of interest as any other human beings – if anything, they tend to be more diverse than the average person, easily to the point of eccentricity. Again, for myself, I’ve been looking for camping and hiking gear for bitcoin – for buying inside the EU, nota bene. No joy.
There is a tremendous first-mover advantage here waiting to happen. If a market broker-portal like Ebay were to start processing payments in bitcoin, then that would be it – they would own this market, being able to serve the most odd and off-trail requests. But we’re not at that point. There are multimillionaires out there who want to buy your stuff, in the US, EU, and elsewhere, and they are asking you to accept their money.
It doesn’t matter that their bitcoin money looks unusual from euros or dollars. Somebody else can take care of that problem for you and give you access to this market, and as usual, “the firstest gets the mostest”. What are you waiting for?