As the price of Bitcoin plummeted for the third consecutive day, we headed to a lecture at the Mecca of digital currency in South America: Espacio Bitcoin
After a first week of exploring, sightseeing, and generally getting the lay of the land in Buenos Aires, we have begun to dig into the meat of our project. Thanks to a very cool group called Mundo Lingo, which hosts language exchange events at local bars three nights a week, we have been able to meet a random sample of Argentines, discuss our project with them and get a sense of their knowledge and opinion of Bitcoin. During the afternoons we have been conducting interviews at various local businesses that accept the currency (more on these findings in a separate post). and yesterday evening we walked over to Espacio Bitcoin for their first event of the new year, a “charla introductaria + experiencia” (introductory chat) hosted by one of the leaders of the Bitcoin Argentina foundation, Ariel Aguilar.
Meanwhile, notoriously volatile bitcoin has tanked in price this week, losing an astounding 38% of its value since Sunday morning! The price had fallen from $279 USD per bitcoin over the weekend to $173 per bitcoin at the time of the lecture (it has since risen back above $200). Needless to say, it was an interesting climate to observe a sales pitch of the currency.
Espacio Bitcoin is located in the city’s “Microcentro” district, just a few blocks away from Calle Florida, where hundreds of Arbolitos meander the streets offering “cambios” day and night in a constant reminder of the nation’s uniquely broken economy. For being the largest digital currency center on the continent, it appears rather nondescript; a grey door sandwiched between a dive bar and a pirate-themed restaurant. Upstairs, however, it is home to the foundation, as well as a variety of other Bitcoin-related startups: the Latin American headquarters of US-based digital currency e-commerce platform Bitpay, Argentina’s own version BitPagos, BTC exchange site Coinmelon, a few software companies and a co-working space that can be rented out for the day.
We were the first to arrive on Wednesday, and as the clock inched towards seven we began to worry that perhaps we would be the only ones in attendance. But that was a naive thought in Argentina, where the “mañana” attitude thrives and things rarely run on schedule. Sure enough, a small audience began to file in and the lecture began about 15 minutes behind schedule.
Aguilar, an enthusiastic man of about 30 who owns an online photo company and hands out business cards under the name “Evangelista Bitcoin”, pitched digital currency’s potential to the crowd. His presentation included a brief economic history of Argentina, video clips displaying worthlessly inflated currency in Zimbabwe, and a local comedian screaming rapidly in Spanish something to the effect of the peso being so worthless he could burn it to start a fire to cook his steak (this was a tough clip to interpret…).
This was in introductory talk, and the rest of the audience admitted to only minimal prior knowledge of Bitcoin, so Aguilar spent most of his time explaining the currency’s functionality as a means of exchange, rather than in investment opportunity. He stressed the idea that digital currency will someday revolutionize the way people donate money and “tip” online. He imagines a world where if you read a piece of writing you really like, or watch a cool youtube video, you would be able to immediately and effortlessly tip the content provider in Bitcoin. He avoided mentioning the recent implosion of the price.
During the subsequent question and answer session, some of the other audience members raised concerns about the lack of “impuestos”–taxes–on BTC, particularly any type of capital gains tax. In response, Aguilar mentioned that the Argentine version of the SEC had ruled that car dealerships and real estate agents would have to report anything they sold in Bitcoin, but that smaller purchases remain unregulated.
When finally prodded about the recent drop in value, he made a very interesting argument about inequality within the Bitcoin world. Apparently, a select few people currently control a large share of the market, and a drop in value should theoretically encourage these entities to sell their BTC, opening up the market to many new users. For some who see the currency as just that–a currency–rather than a speculation tool, it seems the drop in price is welcomed.
Despite the sparse attendance of this particular lecture, Bitcoin Argentina estimates that close to 10,000 people are using the currency in the country. We will hopefully meet more of them next Thursday at the foundation’s first monthly meet up of 2015!