Bitcoin Just Got an Early Christmas Present from the Government

I have been very negative about bitcoin and other crypto-currencies since they first started getting attention six years ago.  I still believe that left to its own devices in the free market, Bitcoin didn’t have much of a chance to amount to anything other than a side show due to the instability and leanings towards criminality.  However, the state of New York just gave Bitcoin an early Christmas Present; Bitcoin is now regulated in New York!

I know, regulation is not usually considered a good thing for a company.  Of course, in true capitalist style, many business people in the Bitcoin ecosystem have been up in arms about regulation for the last two years.  The claims are that these new regulations place undue burdens and costs on a fledgling technology – something akin to strapping a backpack on a toddler who is just learning to walk.  However, I believe these fears are unfounded and this regulation will actually be a massive push forward.

Bitcoin hasn’t struggled because of a lack of creativity or even a lack of investment capital to fund the creative ideas.  Bitcoin has struggled because consumers didn’t trust it or want to use it.  This made perfect sense when you understand the wild fluctuations the currency has endured over the last few years and the number of money laundering schemes it has enabled.  Regulating this industry will give it legitimacy and allow the oversight necessary to calm the fears of consumers and early adopters who might just give it a try.

I would consider myself an early adopter with a background in both the payments industry and the financial markets.  So I think I would be a poster child of sorts for the type of American who would use Bitcoin.  When I saw this new regulation today and read through it carefully, my thoughts were, “As soon as my state adopts these regulations, I am going to try using Bitcoin.”  The new regulation was exactly what I, as a consumer, needed to see.

Why am I writing about this?  Because this could have a very big impact on the independent sales professional in the merchant services industry.  How many of your merchants are set up to accept Bitcoin?  Does this sound like a ridiculous question, something with which you shouldn’t be bothered?  Think again.  This isn’t like AMEX Opt Blue or even Apple Pay; this is like asking a US Merchant to accept the British Pound.  It is a completely separate financial system and currency.  It could turn into a big opportunity for you over the next five years, especially if you live in a metropolitan area.  I believe the time has come not to take action but simply to watch, wait, and see what happens next.

Have a great day!

James Shepherd

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