Top 10 Bitcoin Merchant Sites

By Jon Matonis
Forbes
Friday, May 24, 2013

http://www.forbes.com/sites/jonmatonis/2013/05/24/top-10-bitcoin-merchant-sites/

If you’re involved in Bitcoin, you have no doubt been asked the question “So, who accepts bitcoin?” True, it is the quintessential chicken and egg paradox, but that is not unexpected for the world’s first decentralized cryptocurrency lacking a political authority.

Commodity money and quasi-commodity money must gain legitimacy and acceptance through the rigors of the free market unlike political currencies that simply gain prominence by virtue of State sanctioning. In the true absence of State sanctioning or legal tender status, the monetary unit with the superior features will prevail in a competitive marketplace.

Let’s take a look at the top ten merchant sites on the Internet that are currently accepting bitcoin as payment. Uncensored rankings are based on the amount of three-month traffic received by the website according to Alexa Top Sites (as of May 24th, 2013). The updated list is provided courtesy of The Bitcoin Trader, but a separate version of the Bitcoin Ladder is also tracked on the Bitcoin wiki.
 1. WordPress.com (Alexa Global Ranking 22) – Site offers free blogs managed by the developers of the WordPress software and includes custom design templates, integrated statistics, and automatic spam protection. WordPress announced their decision to start accepting bitcoin in November 2012.

2. The Pirate Bay (Alexa Global Ranking 108) – As a large BitTorrent directory for music, movies and software, The Pirate Bay started accepting bitcoin for donations in April 2013.

3. Reddit (Alexa Global Ranking 117) – The social news and entertainment site focuses on user-generated news links with votes promoting top stories to the front page. Reddit started accepting bitcoin for the purchase of reddit gold in February 2013.

4. The Internet Archive (Alexa Global Ranking 245) – The Internet Archive is a nonprofit organization established to provide a permanent digital library by preserving Web sites. The Wayback Machine provides links to older versions of various webpages. They started accepting bitcoin donations and paying some employees in bitcoin in February 2013.

5. OkCupid (Alexa Global Ranking 687) – The free friendship, dating and social networking site started accepting bitcoin to pay for bonus features in April 2013.

6. 4chan.org (Alexa Global Ranking 882) - 4chan is a simple image-based bulletin board where anyone can post comments and share images without a requirement to register. The boards are dedicated to a variety of topics, from Japanese animation and culture to video games, music, and photography. They started accepting bitcoin for premium subscriptions in December 2012.

7. Namecheap (Alexa Global Ranking 974) -Namecheap offers affordable domain name registration, parking, e-mail, URL forwarding, and SSL certificates. They began accepting bitcoin in March 2013.

8. EZTV (Alexa Global Ranking 1,052) – EZTV.it is your one-stop source for all your favorite TV shows and they started accepting bitcoin donations in April 2013.

9. Mega.co.nz (Alexa Global Ranking 1,783) – MEGA offers 50 GB of free storage space and uploaded files are encrypted with only the user holding the decryption keys. Processed by Bitvoucher, the Kim Dotcom site started accepting bitcoin for private package upgrades in February 2013.

10. Lumfile (Alexa Global Ranking 3,761) – Lumfile is a free cloud-based file server that has been accepting bitcoin for premium accounts since at least December 2012.

Other notable sites in the ranking include LewRockell.com (9,202), OKPay (11,704), and the Tor Project (14,028). Of course, top merchant sites by bitcoin volume would produce an entirely different list, but that data is not always publicly available. Additional bitcoin merchants from a wide variety of categories can be found on the Bitcoin Trade wiki.

Credit Unions Fear Collateral Damage from FATCA

By Jon Matonis
American Banker
Thursday, May 23, 2013

http://www.americanbanker.com/bankthink/credit-unions-fear-collateral-damage-from-fatca-1059360-1.html

Last month, I warned that the Foreign Account Tax Compliance Act, an attempt by the U.S. to impose reporting burdens on other countries' banks, would produce blowback for domestic financial institutions. Credit unions, at least, are worried.

The powerful Credit Union National Association has thrown its support behind Senator Rand Paul's bill to repeal the anti-privacy provisions of this heavy-handed law. "We share your concern that FATCA, if left in place, will impose billions of dollars of compliance costs on U.S. credit unions and banks annually," Bill Cheney, CUNA's president and CEO, wrote to Sen. Paul on May 8. "We are also concerned that FATCA and FATCA-related intergovernmental agreements with foreign nations undermine the constitutional privacy rights of U.S. credit union members and bank customers."

Cheney went on to emphasize the fear of reciprocation by foreign governments for Washington's overreaching.
"CUNA is also concerned that the European Union is considering adopting a 'European FATCA' which would regulate U.S. credit unions and banks in the same manner that the United States' FATCA purports to regulate credit unions and banks in the European Union," he wrote. "Unless Congress repeals FATCA, we think that it is only a matter of time before the extraterritorial diktats of a European FATCA and other FATCA-inspired foreign laws become additional compliance burdens on U.S. financial institutions." As the largest credit union advocacy association in the United States, CUNA represents nearly 90% of America's 7,000 state and federally chartered credit unions and their 96 million members.

Sen. Paul has cited the destructive effects of the law and questioned its legitimacy as a tool to combat tax evasion, arguing that "FATCA has had the practical effect of forcing [foreign financial institutions] to relinquish any association with American customers, and to avoid direct investment in the United States. Perhaps even more troubling, the implementation of FATCA has allowed the Treasury Department to make independent decisions with respect to the sovereignty of foreign nations and the privacy of United States citizens."

CUNA's support for rolling back FATCA follows a move on March 27 by the World Council of Credit Unions, which represents member-owned cooperative nonprofit lenders in 100 countries. Michael S. Edwards, the council's vice president and chief counsel, called for full repeal of the law, similarly citing the boomeranging costs of FATCA from foreign institutions to domestic U.S. entities like credit unions.

By comparison, the credit unions' banking brethren have been subdued in their resistance to FATCA. Texas and Florida banks have sued to block a regulation requiring them to tell the IRS when they pay interest to nonresident aliens, and the American Bankers Association has urged the agency to spare certain products and balances from reporting requirements.

Aside from the credit unions, many in Washington are weighing in on the matter. In its 2014 budget, the administration buried a request for Congress to authorize the Treasury Department to issue unprecedented regulations requiring U.S. financial institutions to report information on nonresident accounts for the IRS to share with foreign governments. This plan may be dead on arrival.

According to the White House's "Analytical Perspectives to the Fiscal Year 2014 Budget," "the [budget] proposal would provide the Secretary of the Treasury with authority to prescribe regulations that would require reporting of information with respect to nonresident alien individuals, entities that are not U.S. persons, and certain U.S. entities held in substantial part by non-U.S. owners, including information regarding account balances and payments made with respect to accounts held by such persons and entities."

Without such authority, the Treasury Department will be unable to follow up on its promises that have been a part of the already-negotiated "intergovernmental agreements." The IGAs have been instrumental in persuading foreign governments to enforce FATCA on themselves in exchange for imposing FATCA-like mandates domestically in the United States. But the agreements are an unauthorized creation of the U.S. Treasury Department, according to McGill University law professor Allison Christians, author of a recent Tax Notes International article, "The Dubious Legal Pedigree of IGAs (and Why It Matters)."

James George Jatras of RepealFATCA.com calls Sen. Paul's bill "a major game-changer." He also predicts Congress will fail to legislate the necessary reciprocity authority to rescue the flawed statute. "With the wind in Washington now blowing against FATCA, foreign governments are on notice that Treasury's promises of 'reciprocity' are plain rubbish," according to Jatras.

Though Sen. Paul's bill aims to repeal only certain anti-privacy provisions of the FATCA legislation and a companion version is expected in the House, he has also been holding up Senate approval of all tax treaties since he was elected in 2010.

Jatras encourages all international firms to get involved, adding that "American and non-U.S. firms that stand to lose millions of dollars each complying with FATCA need to help push the repeal bill through. FATCA repeal needs to be part of any tax reform."

With a litany of bipartisan reasons to oppose FATCA, ranging from privacy and sovereignty to U.S. economic competitiveness, it is startling that the legislation has advanced as far as it has. The situation speaks volumes about the opaque process of continually "hiding" the specifics of putting laws into practice in other legislation, resulting in the nearly seven-year implementation timetable.

Bitcoin Comes To SWIFT

By Jon Matonis
Forbes
Monday, May 20, 2013

http://www.forbes.com/sites/jonmatonis/2013/05/20/bitcoin-comes-to-swift/

Hosted at the palatial and temple-like SWIFT headquarters, this year’s TransConstellation Alumni conference featured a mix of panel representatives from both “new” payment approaches and “established” payment players. I was invited to represent the new approach in an Oxford-style debate which I gladly accepted.

As the mecca for international payments, SWIFT is situated on a sprawling green campus in La Hulpe, Belgium where deer leap through the underbrush and occasionally cross the road in front of you. The member-owned cooperative provides the communications platform to connect more than 10,000 banking organizations, securities institutions and corporate customers in 210 countries. If you have ever made an international wire transfer, it has probably run through the SWIFT network. Also, with global initiatives like Innotribe, SWIFT readily embraces the study of emerging payment paradigms and the potential for disruptive operators to alter the landscape.

It was a pleasure to watch the live bitcoin transaction feed from Blockchain.info scroll proudly across the 8-foot screen monitors at both ends of the high-ceiling reception room. That is what decentralization looks like. In the absence of third-party intermediaries, amounts and fees and transaction numbers are on display for all the world to see. Somehow, I doubt that a similar live transaction feed from SWIFT’s network was scrolling on a public web browser anywhere in the building. And from the looks on some faces, I think that realization dawned on the attendees as well.

Interactive audience questions ranged all the way from “how will Bitcoin mining nodes transition to an environment of transaction fees only” to “how can something with no backing be a store of value” to “this is the first time I’ve ever heard of bitcoin,” so hopefully some lives were changed. In general though, the audience and the panel were more aware of Bitcoin than I would have expected, but maybe that’s a result of the recent price run-up too.

The educational evening yielded no clear winner since the majority of the audience concluded that a cryptocurrency like bitcoin may indeed represent the future, but the path will be evolutionary rather than revolutionary.

This European Union approach to money and payments sits in stark contrast to events currently unfolding in the United States where a still-evolving payments exchanger recently had account funds seized via court order on dubious legal grounds. The EU tends to view futuristic payments as a framework opportunity rather than a target-rich environment for arrogant enforcement.

The dichotomy between EU and U.S. approaches to e-money becomes even more apparent when one looks at the uniformity of the EU e-Money and Payment Services Directives versus the almost hostile FinCEN guidance on virtual currencies and the incomprehensible patchwork of state money transmitter laws. Because of this, I estimate that the EU currently enjoys at least a five-year head start over its U.S. brethren in accommodating evolving payments efforts.

Whereas the EU strives to provide reasonably low barriers to entry without sacrificing currency choices, the U.S seems content to extinguish innovations like e-Gold in an effort to maintain complete control over money businesses and to project dollar hegemony within its borders. In Russia, now a surprising bastion for freedom of choice in virtual currencies, e-payments brand WebMoney began integrating bitcoin into their value transfer system (although U.S. customers are blocked).

The undeniable march of Bitcoin definitely left an impression on SWIFT, however Bitcoin as a network is an existential threat. Bitcoin as a non-political, non-corporate unit of account is not. Rhetorically, I posed the question: “In fifty years, would you rather own 100 euros, 100 Amazon Coins, or 100 bitcoins?”

Bitcoin plays for the long game. The very long game. Bitcoin block rewards are set to expire eventually and all units of bitcoin will be created by the year 2140, shifting the mining economics completely to transaction fees. In the end, financial and monetary decentralization will win the day because that is more simply the state of nature. I only hope that I am around to enjoy it.

6 New Bitcoin Educational Resources

By Jon Matonis
Forbes
Monday, May 13, 2013

http://www.forbes.com/sites/jonmatonis/2013/05/13/6-new-bitcoin-educational-resources/

In the fast-moving Bitcoin world, it’s crucial to stay up to date with the latest in educational resources and new media. The last two months have seen an explosion in media attention and a desire for new users to learn as much as possible about the global bitcoin economy. It is within this spirit that I present the latest Bitcoin educational resources to hit the web:

CoinDesk – This London-based resource and news operation aims to be the “Reuters of Bitcoin” according to its founder Shakil Khan. As an angel investor in Spotify and bitcoin startup BitPay, Khan noticed a gap in the news coverage for bitcoin and digital currencies in general when other entrepreneurs constantly questioned him about the bitcoin.

Also just last month, Khan assisted in orchestrating the sale of his mobile news gathering portfolio company, Summly, to Yahoo for approximately $30 million. Now, drawing on the experience of a few editors and freelance writers, CoinDesk largely covers the growing Bitcoin ecosystem for a general, non-technical audience. It still needs an RSS subscriber feed , but it is off to a brilliant start.

The Genesis Block – A welcome addition to the Bitcoin blogosphere, the writing is refreshing and sometimes technical. The Genesis Block claims to be your foundation for all things Bitcoin and they are a news and tutorial site covering mining, trading, economics, and businesses. The authors involved in the project include Phil Archer, Jonathan Stacke and Wayne Parker. Intentional or not, little else is known about the founders however they consistently crank out good content.

Bitcoin Education Project – The full name of this community-built resource is “Bitcoin or How I Learned to Stop Worrying and Love Crypto: The definitive guide to understand what the bitcoin is and why we should care about them.” Started by technology entrepreneur Charles Hoskinson and part of the Udemy network, this online Bitcoin course is one of many educational courses offered by the Udemy marketplace. The free course is organized into several mini-lectures covering Bitcoin basics and extending into specific topics such as wallets, mining, transaction fees, and cold storage. Interesting future content is crowd-funded on the site.

Khan Academy Bitcoin Series – Founded in 2008 by Salman Khan, the non-profit Khan Academy is on a mission to provide a free world-class education for anyone, anywhere. Within the larger Finance and Capital Markets section, and then within the Money, Banking and Central Banks subsection, they currently offer a new 8-part Bitcoin series taught by Zulfikar Ramzan, a world-leading expert in computer security and cryptography. Receiving his Ph.D. in computer science from MIT, Ramzan is currently the Chief Scientist at Sourcefire. Also, the interactive discussion below each lecture is particularly good.

Bitcoin Press Center – Launched by Andreas Antonopoulos as a sensible reaction to the bitter infighting regarding potential press contacts within the community, this resource supports multiple languages and time zones as well as targeted searches of individuals that have expressed a willingness to be available for media interviews. Billing itself as the global media center for Bitcoin and the best way to find a specific Bitcoin expert, the site accepts new nominations for Bitcoin experts with the only criteria being accuracy of their stated credentials and confirmation that they want to be listed.

Let’s Talk Bitcoin – This all-Bitcoin podcast is brand new on the scene and produced by Adam Levine, who has developed a loyal listener following in a short amount of time. Providing current news, topical interviews, and studied analysis, Adam is joined by Let’s Talk Bitcoin co-hosts Stephanie Murphy and Andreas Antonopoulos. The program started with an overly-ambitious daily schedule and is now available on Tuesdays and Thursdays, which hopefully will prevent burnout. Listeners can also send in questions and comments.

Expertly produced and always knowledgeable, this important program is well on its way to becoming the de facto podcast for all things Bitcoin. My only complaint is that the audio hosting has jumped around a lot and it’s not always easy to find the segment that I’m looking for. Despite that, Let’s Talk Bitcoin is required listening and vitamins for your Bitcoin brain.

CardFlight's Tech May Someday Give Lift to New Payment Systems

By Jon Matonis
PaymentsSource
Monday, May 13, 2013

http://www.paymentssource.com/news/cardflights-tech-may-someday-give-lift-to-new-payment-systems-3014106-1.html

Typically, I don't cover or analyze so-called payments innovations that merely embrace and extend the legacy infrastructure, but a new middleware startup, CardFlight, could actually operate as a payments "air traffic controller" because its code sits directly between the consumer and the processor.

CardFlight announced the availability of a private beta last week for the iOS and Android platforms. Its encrypted magnetic-stripe card reader and simple software development tools allow developers to handle swiped card payments within mobile apps without becoming payments experts. It focuses on card-present payments and charges 10 cents per transaction.

As the New York startup's technology makes its way into more mobile applications, the company could also begin to offer non-card payment choices as well, such as the new cryptocurrencies like Bitcoin circulating worldwide now. Just as mobile application developers don't want to worry about compliance with the Payment Card Industry (PCI) data security standard, they don't want to worry about alternate payment models either. A one-stop shop for payments integration can allow developers to support bitcoin processing for a global marketplace.

The existing merchant processor landscape offers either a 100%-card platform or a 100%-bitcoin platform, requiring developers to integrate each separately. Atlanta-based BitPay is the leader in bitcoin merchant processing and they offer exchange rate guarantees as part of their service.

If grabbing market share of placement within mobile applications is the name of the game, the payments functionality is an excellent place to start.

"We aim to be the leading enabler of mobile commerce for vertical industry software developers and our vision is not constrained to Visa, Mastercard, Amex, and Discover," says CardFlight founder and CEO Derek Webster. "As a lynchpin in the payments processing chain, if customers demand bitcoin or Ripple support, we could easily accommodate those processing solutions because CardFlight acts as a switchboard."

At just three months old and with only three employees, CardFlight has the potential to fill a void left by companies such as Apple.

While restricting payment options for digital goods, Apple has traditionally permitted payments for real-world goods to go through a variety of payment channels. However, the Apple App Store still restricts the send and receive functionality for Bitcoin wallet apps on iOS. Conversely, the Google Play store does not place the same restrictions on Android Bitcoin wallet apps.

As a development tool provider with an open platform, CardFlight suggests potential uses for its technology such as apps for event organizers that need to sell tickets at the door, CRM apps to enable field sales and medical-practice management apps to collect a copay while keeping the rest of the details available for insurance billing.

It's interesting that the company has recently partnered with Stripe, which offers similar application development tools for 'card not present' transactions, because together the two companies can present a combined offering that is essentially a customizable version of Square and PayPal. Online and offline, they have you covered.

"We're proud to be working with CardFlight, as they share our developer-friendly approach to payments," Stripe Business Development Manager Cristina Cordova said in a blog post. "CardFlight provides tools to any Stripe user looking to incorporate in-person payments into their mobile apps, while still taking advantage of Stripe's simple pricing and seamless setup."

Sure, Stripe could extend into CardFlight's space at some point or vice versa, but for now the partnership is valuable to both.

Money Laundering Is Financial Thoughtcrime

By Jon Matonis
American Banker
Tuesday, May 7, 2013

http://www.americanbanker.com/bankthink/money-laundering-is-financial-thoughtcrime-1058902-1.html

When people hear the term money laundering today, they envision the most evil of acts, in which gangsters process satchels of cash through a fabricated company to show it as business revenue. Words and semantics are very important in this post-9/11 world, and as far as creating a negative connotation, that parlance has been extremely effective.

At its essence, money laundering is the act of concealing money or assets from the state to prevent its loss through taxation, judgment enforcement, or blatant confiscation. However, as the late J. Orlin Grabbe wrote: "Anyone who has studied the evolution of money-laundering statutes in the U.S. and elsewhere will realize that the 'crime' of money laundering boils down to a single, basic prohibited act: Doing something and not telling the government about it."

Protecting one's wealth is interwoven with the history of trade and banking which has existed since the dawn of commerce. Sterling Seagrave's Lords of the Rim describes how some 2,000 years before Christ, merchants in China would hide their wealth from rulers who would simply take it from them and subsequently banish them. This concealment involved moving the wealth and investing it in remote provinces or outside China.

Part myth, part rumor, the plausible tale of Mafia gangsters running huge amounts of cash from extortion, prostitution, gambling and bootleg liquor through existing Laundromats accounts for the phrase money laundering.

Also during this period, Al Capone was convicted in October 1931 for tax evasion, which is what earned the prosecutor's conviction rather than the predicate crimes that generated his illicit income. Capone's episode inspired Meyer Lansky, the mob's accountant, who structured elaborate international and Swiss financial facilities for safely securing money and vowed never to suffer Capone's fate.

Lansky is credited with designing one of the first real laundering techniques, the use of the "loan-back" concept, which disguised allegedly illegal money within "loans" provided by compliant foreign banks. The money could then be justified as revenue and a tax deduction for interest expense obtained in the process.

Without any method of tracking cash or bank activity, Congress passed the Bank Secrecy Act in 1970, heralding the age of transaction reporting, including the Currency Transaction Report (Form 4789), the Report of International Transportation of Currency or Monetary Instruments (Form 4790), and the Report of Foreign Bank and Financial Accounts (Form TD F 90-22.1). In the United States, the Money Laundering Control Act formally made money laundering a federal crime.

Internationally, the elements of the crime of money laundering are set forth in the United Nations Convention Against Illicit Traffic in Narcotic Drugs and Psychotropic Substances and Convention against Transnational Organized Crime. Also, the Financial Action Task Force on Money Laundering, founded in 1989 on the initiative of the Group of Seven industrialized nations, is an intergovernmental organization whose purpose is to develop policies to combat money laundering and terrorism financing.

From President Roosevelt's 1933 seizure of personal gold to the Nazi confiscation of Jewish wealth to the recent deposit theft at Cyprus banks, asset plundering by governments has a long and colorful tradition. Protecting wealth from oppressive regimes continues to this day.

It's highly political and also a matter of perspective whether protection from confiscation is a justifiable activity. Government access to wealth is at the heart of the issue and it matters not if it's hiding money or cleaning money.

Therefore, the artificial crime of "money laundering" had to be invented, mainly because more direct and traditional methods of enforcing certain laws yielded little result. Think of it as driving without a light bulb above the license plate being a felony because thieves might drive away in the night. All must participate in illuminating the way to be tracked. More than anything, this is a clear sign of regulatory desperation.

Money laundering has been called the thoughtcrime of finance. Isn't it really just banking with someone's possibly nefarious intentions attached to the act? It's like buying a drive-thru donut in a stolen vehicle. The theft of the vehicle may have been illegal and immoral but the act of purchasing a donut is not. Money laundering is not pre-crime but post-crime. And, it's difficult to identify the victim, other than the bank shareholders that must expend millions of dollars for the proactive compliance required as the state's deputized enforcers.

Moreover, money laundering is guilt by association. If the monetary flows resulting from associated businesses are deemed illegal, then the banking activity is defined as money laundering. But, in the absence of victimless crime laws against drugs, gambling, and prostitution, the majority of banking labeled as money laundering would simply be banking.

According to the International Money Laundering Information Bureau, "Money Laundering is also the world's third-largest industry by value." Apparently, it happens in every country in the world. Well, breathing by humans also happens in every country in the world. If money laundering is actually the third-largest industry in the world then it's either being calculated wrong or it's too easily defined.

In his Rolling Stone article "Gangster Bankers: Too Big to Jail," Matt Taibbi mocks the anti-money-laundering regime as being hypocritical because large commercial banks like HSBC receive a light slap on the wrist and the blind-eye treatment as smaller fish are routinely scooped up in the net. Taibbi correctly distinguishes between an arrestable class and an unarrestable class. However, he misses the point of the law's arbitrariness in the first place. Thank you for the analysis, Mr. Taibbi, but dispensing enforcement of an immoral law more evenly is not a solution for justice.

Even as the money-laundering laws are said to exist for the fight against terrorism or drugs or gambling, the cashless utopia is simultaneously being thrust upon us as the monetary architecture of the future. Expect ever more increasing thoughtcrime enforcement as the international money flow tightens.

The Digital Case For a Liberalised Money System

By Jon Matonis
CapGemini
Tuesday, May 7, 2013

http://capgemini.ft.com/cloud-computing/the-digital-case-for-a-liberalised-money-system_a-25-68.html

Bitcoin is the largest distributed computing project of all time. Through a smart mathematical model and the use of peer-to-peer networking, it offers a fantastic and necessarily liberal way for people and organisations to transact.

Bitcoin recently surpassed SETI, the search for extraterrestrial intelligence, as the largest distributed computing project in the world. By using the fast computing horsepower available globally, and long-standing cryptographic primitives, Bitcoin offers effective and affordable transactions without an intermediary.

Bitcoin is a currency that can be thought of as file sharing for money. It's simple to use, open source, and available to everyone. Individuals can buy Bitcoins, and trade them online, send them to friends or family, or use them to buy goods or services. Simple exchanges conduct transactions and companies such as BitPay set up the merchants and absorb any currency risk. Individuals and organisations can check the value of a Bitcoin at any time on Bitcoin Watch.

This method of transacting offers a huge change from existing services such as banks or the likes of Western Union  or MoneyGram, for which people have to pay fees to send money. It liberalises the whole transaction by removing the intermediary and allowing people to trade as they wish. Finally, there is a system that suits the user.

A bubble?

There has been a lot of talk over whether there is a Bitcoin bubble, given the changing value over previous weeks. Our perspective is that there is not, and that it was a case of media talk exacerbating a change. Bitcoin is here for the long term, over 11 million Bitcoins are in circulation (and the number will eventually be limited to 21 million in total), and the currency's value is clear now and over the coming decades.

Individuals, globally, already use Bitcoin to send money to other individuals or to organisations. Some of the more high profile organisations that accept Bitcoin currency include dating site OKCupid, the WordPress blog, as well as donations to organisations such as Wikileaks. But it is available to everyone globally, and can be used in theory for any transaction. Organisations can easily receive Bitcoins by adding their receiving email address on their website.

There has been concern expressed around regulation. Actually, we speak regularly to the regulators, and we express our perspective that Bitcoin offers a very useful service for individuals and organisations wanting to transact, and that we are an important part of the economy. There is good scope for sensible regulation on exchanges. Four countries - the US, France, Norway and Australia - have issued explanatory notes on the currency as it gains importance.

Unlike many of the payment processors, Bitcoin does not act as an intermediary and there is a minimal charge for using the service. It is available to any country and any person using an Internet connection on any device - supported on a P2P network with all transactions going through the Internet. Technology has enabled this phenomenal change.

What the foundation does

The Bitcoin Foundation, created seven months ago, acts very much in the way the Linux Foundation acts for open source software. We recognise that effectively we are up against established companies, and therefore a foundation is essential in promoting a level playing field for Bitcoins and discussing the issues around currency. Additionally, we focus very much on the standardisation of Bitcoin so that it is easily used globally.

We also do fundraising and compensate developers, as well as organising a grant program to advance the protocol. Although we are based in the US, 60 per cent of our members are elsewhere around the globe.

This May, we are hosting a conference on the future of payments. We will cover all the business, regulatory and economic, and technology issues.

The Foundation is here to preserve Bitcoin. It's important because never before have we witnessed valuable remote transactions that don't require intermediaries. We are a nonpolitical organisation and the world's foremost educator on the currency. Rather than enter moral issues around money or who spends it on what, we are keen to promote freedom of choice, through an open source P2P network, with regard to money.