The Bitcoin craze hasn’t hit Atlantic Canada – yet
It’s taking some time for Atlantic Canada to warm up to the Bitcoin concept.
At least that’s the opinion of Halifax’s Reed Holmes, who works in the fledgling digital currency business for Calgary-based CaVirtex. The firm is a trading market that allows people to buy and sell Bitcoins using Canadian dollars. “We’re still way behind on using Bitcoin,” Holmes says of Halifax. “Lots of university students and kids are dabbling in it, but it hasn’t been picked up at the street level by merchants.”
Never heard of Bitcoin? You are not alone. Bitcoin is a digital payment system that uses a “cryptographic” or secure computer algorithm. While it is legal, it isn’t regulated by any government’s central bank and isn’t backed by any commodity like gold and silver. How it works is clients pay cash to earn Bitcoins, which are stored in virtual wallets and are mathematically generated by a peer-to-peer computer network. The fact that traditional financial institutions like banks aren’t holding the currency scares off some consumers, but Bitcoin is being embraced in some Canadian markets. The first Bitcoin ATM was installed in Vancouver last year and similar ATMs have popped up in Toronto and Ottawa.
Could Halifax, St. John’s or Charlottetown be the next place where acceptance of Bitcoin takes hold? It’s possible, although Holmes says Atlantic Canada’s small population and geographic isolation from Canada’s Bitcoin hubs mean the technology could be slow to catch on here. “It takes a little while for people to wrap their heads around it.”
But wrap their heads around it they will, Holmes predicts. He thinks a Bitcoin ATM will be installed in Halifax in 2014, and he expects digital currency to become more commonplace. He adds that it has advantages for consumers and businesses over other forms of currency like cash and credit cards. “I like the utility of it. You can move money so quickly and there isn’t the same kind of processing fees along the way. You can save a lot of money.”
Addendum: With the recent hacking that resulted in Bitcoins being stolen from Japanese-based exchange Mt. Gox and Calgary-based exchange Flexcoin, maybe we were a little hasty in writing this piece, which went to press long before these hacking incidents occurred. Oh well, we can’t always be right, but at least we can be topical.