Americans soon might head out of the house holding car keys, mobile phone and a digital wallet. Welcome to the world of cryptocurrency.
July 17, 2018 – Philipp von Holtzendorff-Fehling, chief executive and co-founder of Mama Gaia, stands with a Byte Federal Bitcoin ATM that is located inside of his restaurant at Crosstown Concourse.(Photo: Brad Vest/The Commercial Appeal)Buy Photo
Nearly $300 billion in digital money afloat worldwide
Only a few months ago, Memphis entrepreneur Philipp von Holtzendorff-Fehling attended a convention in Miami. He said it helped him glimpse into the future of money.
“I’ve always been interested in the next thing happening to humanity,” said von Holtzendorff-Fehling, a former marketing chief for Memphis-based ServiceMaster. “This is one of the next big things.”
He had come across Byte Federal, a little tech startup from Venice, Florida.
Today, one of Byte’s automated teller machines stands outside von Holtzendorff-Fehling’s Mama Gaia restaurant.
How that ATM landed in Memphis traces to tech hopefuls, schemers and dreamers betting the world is on the edge of serious financial evolution.
Americans, they say, will head out of the house holding car keys, mobile phone and a digital wallet.
It will store something called cryptocurrency, a kind of digital money backed by no important government on Earth and yet significant enough to eventually rival the U.S. dollar as a way to pay for things.
At least that’s what they say.
The new world of cryptocurrency
July 17, 2018 – Philipp von Holtzendorff-Fehling, chief executive and co-founder of Mama Gaia, now has a Byte Federal Bitcoin ATM that is located inside of his restaurant at Crosstown Concourse. (Photo: Brad Vest/The Commercial Appeal)
Sound like science fiction?
Yes, but the trend has taken root.
Among the hundreds of ATMs located in Memphis and its suburbs, about 10 are special cryptocurrency ATMs operated by Byte or rival tech startups Coinsource and RockItCoin.
I had thought these machines were used mainly to send money abroad, particularly by Latinos from home towns with limited banking. RockItCoin co-founder Ben Phillips, a former derivatives trader in Chicago, said international transactions are not the biggest draw.
“Our users come from all kinds of backgrounds,” Phillips said. “We like to put the ATMs in public and high-traffic areas. It’s mainly men, 20 to 40. Some of them see it as a way of investing money.’’
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Right now, about $3.6 trillion worth of American currency is in use worldwide. That’s the value of all minted coins, regular bank deposits and paper money the U.S. Treasury prints on linen and cotton.
Separate of the official U.S. money supply are a slew of cryptocurrencies. They have names such as Bitcoin, Dash, Ethereum, Litecoin, Monero, Ripple, Stellar and Zcash.
Fifth Third Bank, one of the oldest Cincinnati commercial banks, recently reported more than 1,000 of these crypto brands have been identified worldwide. Various guesses place the total value of all the crypto money in the brands at about $295 billion.
That’s small compared to the amount of American currency afloat, although Royal Bank of Canada analysts forecast the value of crypto money afoot someday might surpass $10 trillion.
Entrepreneurs sense an angle.
Cryptocurrency exchanges are cumbersome. They can convert digital money into dollars, or the reverse. But that takes time.
ATMs can handle the transaction faster. Put your American currency in. Bitcoins go into your digital wallet.
Nearly 8,500 of these cryptocurrency ATMs worldwide process digital money, including about 1,300 ATMs in the United States and the handful in metropolitan Memphis.
The latest was installed almost three weeks ago outside Mama Gaia in Midtown.
The ATM operator charges a fee for the service, usually about $3 on each transaction. Sponsors such as the restaurant get a slice of the fee.
‘Looking at options’
Philipp von Holtzendorff-Fehling, chief executive and co-founder of Mama Gaia, is bringing his restaurant to the new Ballet Memphis building in Overton Square. (Photo: Tom Bailey/The Commercial Appeal)
Just the other day, an employee of a public relations firm used by von Holtzendorff-Fehling to promote his restaurant emailed a press release.
A few reporters dutifully rewrote the press release and posted brief news stories online. Yes, this was like free advertising dressed up as news, but I bit, went over to the restaurant, asked von Holtzendorff-Fehling a simple question.
Could I buy the $7 ginger mango beverage with Bitcoin?
No. Traditional money backed by the United States government would work, or my bank debit card, but not crypto stuff.
“We don’t accept any Bitcoins yet,” he said. “We’re looking at the options.”
(Photo: Getty Images)
Would you walk up…