Ottawa's first Bitcoin Teller Machine
Published Thursday, January 16, 2014 6:18PM EST
Last Updated Friday, January 17, 2014 11:20AM EST
Winston Anderson had the honour.
The Ottawa man was the first in line to use Ottawa’s first ever BTM, a Bitcoin Teller Machine. It's installed at the Clocktower Brew Pub on Clarence Street in the Byward Market.
Bitcoins are a form of digital currency – cash that only exists online. Online businesses are starting to accept them as an alternative payment system for goods and services. Ottawa-based ecommerce provider, Shopify, now offers it as an option for their clients. “An online dating site that I’m on accepts Bitcoin, and that was my first Bitcoin transaction,” says Anderson.
Buying Bitcoins can take days to process online. The BTM makes the process almost instantaneous. The user enters his or her online Bitcoin account, or “wallet.” That’s as easy as having the machine scan their smartphone screen. Then the user inserts cash to buy Bitcoins that are stored digitally for later use.
In fact Bitcoin is a bit of a misnomer. There are no actual coins. The currency only exists online. “Bitcoin is digital cash. It’s a peer to peer network for transacting money,” says Ryan Wallace, the CEO of Bit Access supplying the BTM.
It’s not unlike using a credit or debit card online, but with some important differences.
Bitcoins are not regulated by any country or bank. Their cash value can change dramatically. That makes them risky, say some critics. But users say that is part of their strength. They are cheaper to use. And so far the value of Bitcoins has skyrocketed. A single coin was worth around $13 in 2013. Now they’re going for well over $900. (You can purchase fractions.) Many are buying and holding them as an investment.
Because Bitcoins can be traded freely between users some also see it as a way to avoid paying taxes. The Canada Revenue Agency warns that tax laws that apply to bartering also apply to transactions involving Bitcoins. And any money you make by investing in Bitcoins is taxable as well. They're now including digital currency transactions as part of their audits.