Daniel Ballesteros, the co-owner of the Sub Cultured sub shop in Atlantic Beach, says cryptocurrencies are “probably the future of finance,” as he is seeing several of his customers pay with a cryptocurrency called Nano.
There are plenty of others who share his belief.
Among them is Coinflip CEO Ben Weiss. His company, which claims to be the largest crypto ATM provider in the world, has been busy expanding his business across Florida, including in Jacksonville.
Cryptocurrencies are digital money that’s tracked via technology called blockchain, which serves as a public ledger to verify transactions.
Advocates of digital currencies claim they are better than traditional currencies backed by governments because they are based on decentralized technology that’s spread across many computers, making then more secure and in some cases faster to use than traditional transactions that involve credit card companies or banks.
The best known of the more than 6,700 publicly traded cryptocurrencies is Bitcoin.
“The best comparison I would say for Bitcoin in the U.S. is that it’s like digital gold. It’s a better version of gold,” said Weiss.
While governments and traditional currencies sometimes fail or experience extreme inflation, gold has throughout history remained a rare asset that is finite, allowing it to maintain value and serve as a hedge against inflation.
Advocates argue that Bitcoins are also finite and they can’t be counterfeited.
Cryptocurrencies have been around for more than a decade, piquing the interest of some tech geeks and investors. But, for the average person, how would you even get started with a cryptocurrency?
That’s where Weiss says his ATMs come in. Because cryptocurrencies haven’t seen widespread adoption in the U.S., he says people need an easy way to start trading dollars for cryptocurrencies.
“That’s the reason that there does have to be ATMs, because buying Bitcoin – and you know – knowing how to store it and how to get it to you safely and securely online, and linking to a bank account can be a huge process, especially for a small account,” said Weiss.
Using Bitcoin – or any cryptocurrency – to buy everyday goods and services hasn’t become common in the U.S. yet, but there is momentum. Perhaps the most publicized recent example was Tesla’s announcement earlier this year that it would accept Bitcoin as payment for its electric cars. Tesla has also made a $1.5 billion investment in Bitcoin.
Coinbase, a San Francisco startup that allows people to buy and sell digital currency, became the first major cryptocurrency company to go public when it made its stock market debut on last month.
But Bradley Tusk, a venture capitalist who backed Coinbase, conceded cryptocurrencies have a repution of being being volatile.
“Will cryptocurrency ever be used for everyday items? Not sure,” Tusk said. “But another way to think about it is, are we going to hit a point where all payments are digital, and we won’t use cash or credit cards? Absolutely.”
Back at Sub Cultured, Ballesteros said people are already buying their subs with crypto. He said he settled on Nano in part because, unlike credit card companies and many other cryptocurrencies, Nano doesn’t charge him a transaction fee.
Since the start of the pandemic, many have become familiar with using QR codes to pull up menus or other information. Nano uses a somewhat similar approach.
Ballesteros explains how a Nano transaction works: “I would use this little app I have, that I just plug in the dollar amount. And it does a real time conversion to Nano and gives you a little QR code. So you would just take your Nano wallet app, and you would scan that QR code, and then it would automatically send me the amount requested to my Nano address.”
Cryptocurrencies use what are known as digital wallets, which are apps that can securely hold a digital currency.
Although the vast majority of cryptocurrency users have smartphones, you don’t need one to use the Coinflip ATMs, although Weiss said about 90% of his customers use smartphones in conjunction with QR codes at his ATMs.
Weiss said 80% of the Jacksonville businesses that have signed up for his crypto ATMs are mom-and-pop operations.
“We spend a ton of marketing dollars driving people to those locations on the Coinflip dime. So there’s no reason not to have an ATM. Like, what are you giving up? Just one square foot of space,” he said.
– NPR’s Bobby Allyn contributed to this story.
Bill Bortzfield can be reached at bbortzfield@wjct.org or on Twitter at @BortzInJax.