The huge bitcoin prospects have got everyone talking including Canberrans who in actual sense rarely use the digital coin to buy products in the ACT. Today, Canberrans are allowed to use bitcoins to buy cakes or coffee at cafes, and can also top-up their MyWay card on mobile applications of ACTION Bus, or better still use a newly installed bitcoin ATM within the Canberra Centre.
Bitcoin is a digital currency used to make direct payments between parties or businesses that are not regulated by any central bank or government and which operate without a financial set up.
Once acquired, bitcoins can be kept in digital wallets that have smartphone apps as well as online accounts that allow users to transfer their bitcoins to others as a way of paying for goods and services.
The Sly Fox cafe in O’Connor Pat Dillon owner was among the first entrepreneurs to adopt bitcoins in Canberra, and confirms that only a handful customers use bitcoins to buy coffee.
“There are at least 15 people who’ve come through here and used it – mostly IT type people who are familiar with bitcoin,” he added. “I’d say we average at least 2 bitcoin sales a week at the absolute minimum.”
Critics are rife and concur that not even the Australian Tax Office’s ruling in August that bitcoins are deemed property or assets rather than a digital currency will help fasten the painfully slow adoption of bitcoins in the ACT. “The ATO’s view is that bitcoin is neither money nor a foreign currency and the supply of bitcoin is not a financial supply for goods and services tax purposes,” the ruling read in part. “Bitcoin is, however, an asset for capital gains tax purposes.”
Zakaria Boughuettaya, a Canberra software developer highly recognized for designing the MyBus 2.0 mobile application for ACTION Buses in partnership with his business ally Andrew Clapham, claimed that since the application’s launch five months ago, only 20 bitcoin transactions had so far been registered.
“To be honest we installed the bitcoin facility as a bit of a marketing tool and weren’t sure how many people would make use of it,” said Zakaria.
He adds that he was stunned by the numerous emails he received during the temporal removal of the bitcoin option by the software developers to install updates.
“We received about 30 emails from people asking for it to be reinstalled which is odd because that’s more people than have actually used the feature,” he added.
Mr Boughuettaya said the positive response was a strong indication of bitcoin’s popularity among its enthusiasts, many of whom had only used it for occasional experimentation.
Australia’s third bitcoin ATM was installed in mid-July on Canberra Centre’s second floor. The ATM allows a new user to create an account within a short time; three to six minutes unlike the conventional way of using computer which takes several weeks before verification takes place.
V Spot Café owner Chrissie Wittich, who appreciated bitcoins’ ‘novelty aspect’ and consequently embraced bitcoin recorded 22 bitcoin transactions amounting to $296 in their Civic store since the year began.
Ms Wittich added that she was surprised with the many transactions and felt that the ATO’s August ruling on bitcoin would have little if any impact on trade.
“I don’t expect it would have too big an influence on people using bitcoin just to buy a cup of coffee or a toasted sandwich,” she said.
Jason Williams, the President of the Bitcoin Association of Australia said in a statement in August that the ATO’s ruling was unfortunate and likely to lead to a currency decline in Australia.
“Applying double GST to some bitcoin transactions will adversely affect investment in the bitcoin economy and may push bitcoin businesses to relocate to other, more favourable jurisdictions,” he was quoted saying.
Early last year, a bitcoin was valued at less than $50, rose to over $1200 by December of the same year and is currently priced at approximately $516.