Polina is an undergraduate student at Belarusian State Economic University (BSEU) where she is studying at the faculty of International Business Communication for a degree specializing in Intercultural Communication. In her spare time she enjoys drawing, music and travelling.
Forbes editor Kashmir Hill repeated her last year experiment of living on bitcoin for a week. With a year of media attention to Bitcoin, will it be any easier to live on the virtual currency for a full week?
Kashmir Hill, a senior online editor at Forbes Magazine, spent a whole week living on bitcoin in May 2013. Although there were some troubles and she had to move out of her house, but she survived.
So, Hill decided to try living on bitcoin for another week again. She has the same amount of bitcoin to live on as she had in the previous year. However, the price of the virtual currency increased four times since last year. Thus, Hill holds more than $2,500 on which to live this week.
A year ago, the digital currency was little known outside of black-market and tech circles. Since then, the situation has changed as bitcoin increased in its value and achieved $1100 in November 2013. Moreover, there was a boom in the media attention paid to the virtual currency.
Millions of dollars were invested in the bitcoin-related start-ups, New York Times and Wall Street Journal reporters wrote about it. There have also been hearings about bitcoin at the Congress and bitcoin ticker became available on Bloomberg terminals.
After the start of the experiment, Hill convinced her roommates to pay with bitcoin for rent, acquired a few Gyft gift cards for everyday needs and even ordered Indian food delivery via Foodler. Still, Hill faced several serious challenges.
On the first day of the experiment Hill had to use a bike for traversing a three miles way to her work in the Financial District of San Francisco. The problem is that she couldn’t pay for a taxi or the bus using bitcoin.
The biggest concern for Kashmir Hill this year is whether she could pay for rent in bitcoin. When she asked her landlord if she could pay in the digital currency, he agreed.
Still, he wasn’t very excited about receiving payment in bitcoin. Moreover, her landlord was worried about the tax implications if he uses bitcoin. Anyway, he accepted the payment, although it was out of pity.
When Ramen Underground, a local restaurant, declined to accept bitcoin, Hill decided to try a bitcoin-using gourmet grocer called Buyer’s Best Friend. After picking out the products, some problems aroused at the check-out.
The clerk at the shop converted her $26 bill into bitcoin and popped up a QR code via Coinbase. Hill scanned and sent the .06032 worth of bitcoin but it didn’t go through. It appeared as unconfirmed on her Blockchain app and the clerk didn’t receive an email about the payment. After 20 minutes of waiting it still didn’t go through.
When Hill returned home without any food, she tried to order some Indian food from Foodler, a Boston-based company which accepts bitcoin. The lunch was delivered. This demonstrates that bitcoin is much better for online payments.
The bitcoin network finally confirmed the transaction with Buyer’s Best Friend after 67 minutes Hill had ordered Indian food. The possible challenge is that there was no mining fee on the transaction and the network made it low priority.
The experiment showed that a lot of time should past before bitcoin can compete with cash and credit cards. At the same time, the experiment provided an insightful view into the gaps in bitcoin adoption.