[ExI] Bitcoins Again

[James Clement]

>From Wired Magazine:
http://www.wired.com/business/2013/05/350000-in-real-money-for-bitcoin-startups/

Bitcoin took another step toward the mainstream Tuesday with the
announcement of at least $350,000 available for Bitcoin-focused startups
participating in the next class of Silicon Valley-based
acceleratorBoost VC<http://boost.vc/>
.

If first generation companies were focused on the infrastructure aspects of
the crypto-currency (generating or mining actual Bitcoin
currency<http://www.wired.com/wiredenterprise/2013/05/butterfly_live/>
and
providing an exchange for it), the next wave will be about making the
math-based money simple for non-hackers to use, says Boost VC founder Adam
Draper. “We are especially interested in startups that make it easier to
actually spend Bitcoin currency,” Draper says. “Security is another big
opportunity. If Bitcoin is to succeed as a global currency and really start
being used for transactions, everyone needs to trust it.”

Trust in Bitcoin has been hard to come by lately. Straight-up
theft<https://bitcointalk.org/index.php?PHPSESSID=t015657v5nmnd3qbqf2479p0g7&topic=83794.msg923918#msg923918>
of
Bitcoin has been a regular occurrence at the electronic exchanges and from
the electronic wallets where Bitcoin currency is “stored.” There is also
the generally outlaw nature of those who prefer it, using the anonymous,
untraceable Bitcoin to buy drugs and other illegal items. And finally,
there is the volatility in the currency itself, which has soared and
crashed in value at least five times since the network launched in 2009.

Still, for all the larceny, black market trades, and general difficulty in
acquiring and using Bitcoin, Draper and the folks backing the Boost VC
accelerator believe that Bitcoin or some other math-based money will become
a global currency.

“In the long-term, what is going to drive the value of Bitcoin is the use
of Bitcoin for transactions, and the ability to take transaction costs to
zero,” says Jeremy Liew, a partner with Lightspeed Venture
Partners<http://lsvp.com/team/jeremy-liew/>,
the venture capital firm anchoring Boost’s Bitcoin fund.

If the decentralized Bitcoin gets rid of the percentage fees charged by
banks, credit card companies and payment services (or reduces them
dramatically), it makes profitable all kinds of new micro-transactions in
online media, in gaming and in charities and donations. And would grocery
stores take an extra percentage point or two on their already tissue-thin
margins? Absolutely.

“Radical libertarians love the idea of no central bank, and some portion of
the people don’t want other people to know what they are doing because they
are breaking the law, but once my transaction costs go to zero, that is
transformative,” Liew says. “You are seeing this sea change in the
(Bitcoin) user base, what they care about is zero transaction costs because
their interests are purely financial. And there a whole lot more of those
people out there than the criminals or radical libertarians — that is what
is going to carry Bitcoin into the mainstream.”

Boost VC has already accepted two Bitcoin startups into its latest class,
and there is room (and money) for at least five more, Draper says. Boost VC
provides housing, mentoring and about $50,000 to its participantsz. The
application deadline is June 1, and the program starts June 24th. So all of
you with Bitcoin dreams, get on it <http://boost.vc/apply>.


James
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