You know the Bitcoin revolution has begun when one of the world’s largest digital travel agencies starts accepting it as a payment method. Expedia’s announcement that they will now accept payments via the new virtual currency has the attention of both tech savvy tourists and bigwig economists, albeit for different reasons.
Bitcoin is the latest product in the digital currency craze to stir up online hysteria and looks set to become the new Paypal of its generation. So what exactly is Bitcoin? Well, put simply it’s a virtual token where value is dependent on what others are willing to pay “” much like real money. The difference is that it requires no central body to handle transactions, and a collective network carries out the issuing of Bitcoins. The pros are clear: money can be transferred in a simple, streamlined payments system, cutting out the pesky transaction fees that travellers are usually lumbered with when exchanging currencies or paying via credit or debit cards abroad. Sounds good right?
It is an interesting proposition and one that has become big news across the tourism and leisure industries. Launched in 2008, Bitcoin’s origins are obscure, (despite the best efforts of many a would-be-detective), but at the core of its invention is the fact that it serves to move monetary power and control away from central banks and politicians and into the hands of the public. The network now boasts approximately 12 million virtual coins in circulation, a figure that will no doubt be boosted as global companies like Expedia start accepting it.
Although it is still in the early stages of its development, the worth of the experimental Bitcoin continues to rise rapidly. However, there is still volatility around the market and no one really knows what the future holds. Despite the uncertainty there are already 60,000 retailers worldwide that accept payments via Bitcoin and the number is growing. But the true draw of the Bitcoin is its cost effectiveness and simplicity and advocates of this new digital currency are insistent it is a promising development for travellers, particularly business travellers who can jet across borders for a lunch meeting and pay for their meal in a seamless click of a button without the annoyance of exchanging currencies or being charged a colossal fee from their bank. Not only that, the very nature of Bitcoin means that merchants in poorer countries who have been priced out by mainstream banking systems due to costs and fees will be able to compete against their more wealthy counterparts in an open market.
Meanwhile, many will ask why Expedia is adopting this now? In a press release Michael Gulmann, Vice President of Expedia Global Product, suggested that the move would help “solve travel planning and booking for customers and partners alike by adopting the latest payment technologies.” Something most regular travellers will applaud as an innovative, convenient and cost effective alternative to conventional options available out there now. The international scope is an alluring one too, although major airlines and automobile rental companies have yet to follow suit, no doubt they’ll be watching Expedia’s success with the new payment method closely over the next few months. And there are whisperings that Apple is developing software for Bitcoin virtual wallets, making it even easier for users to access.
Even now there are travellers testing out Bitcoin’s ease of use, Yahoo profiled one US-based family who are travelling across the United States only using the virtual currency and documenting their experience. Although there is still a long way to go yet, and the traditional banking organisations throughout the world will need to start taking it seriously, we could soon be seeing the tipping point the Bitcoin revolution.
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Written by Chantelle Symester