This week Amsterdam hosts two remarkable Bitcoin Events, making one of the larger Dutch newspapers suggest that these days Amsterdam is the Bitcoin Capital. Bitcoin is the most wellknown example of a worldwide trend of digital (crypto)currencies being developed by open source communities.
Serious attention of banking industry
The long in advance planned Bitcoin 2014 is the annual international forum organised by the Bitcoin Foundation. Just very recently the Dutch National Bitcoin Congres was planned one day prior to this international forum. The National Bitcoin Congres, held at the Innovation Centre of ABN AMRO bank and with former Minister of Finance Jan Kees de Jager on stage, shows that the bitcoin gets more and more serious attention. Not because of the bad publicity about criminal activities in all the media, but foremost because of the interesting, advanced technology built by the community of bitcoin developers volunteering to work on the bitcoin code. As Mark Buitenhek, Global Head Transaction Services at ING bank, stated in the panel: ‘you all think that I am asked to come over here to compare the bitcoin with the Tulip Bubble in the 17th Century but to be honest I am following the bitcoin technology with serious interest for three years already.’ The dominant opinion in the discussions was that banks can learn a lot from the bitcoin technology.
Become more mainstream
That the bitcoin community itself is also making progress to become more mainstream is shown by Bitonic, that applied for official regulation by the Dutch Central Bank for a bitcoin exchange platform to be established this summer. Safello anounced on stage that it wants to apply for a full banking licence, predicting that the bank of the future will be the new social network of money, based on bitcoin technology. However, there were more modest statements made too during the congres, mainly pointing at the relative small adoption of the bitcoin by customers. On the side of merchants the figures were more optimistic. Payment service provider Bitpay already has 30.000 merchants worldwide, making it possible for them to accept payments in bitcoins. Service provider Molly announced yesterday that paying in bitcoins is now a standard option in their offering of different payment services. Bitpay and Molly are both based in Amsterdam and pointed out that the Netherlands are frontrunner in bitcoin acceptance because of their maturity in the e-commerce space.
Amsterdam’s financial tradition
After leaving the National Bitcoincongres I attended the opening reception organized by the City of Amsterdam for the VIP’s of the international Bitcoin community. The reception took place in the beautiful historical building The Bazel, were the ‘Nederlandse Handel-Maatschappij’ (Dutch Society for Trade) resided for many years. In this environment it was impossible not to talk about the rich financial history of Amsterdam, home of the East-Indian Company, the first stock exchange and the first central bank. All financial innovations originated in Amsterdam at the beginning of the 17th century. Ironically these are the institutions now being challenged by the development of cryptocurrencies like the bitcoin.
Cooperation without coordination
I spoke to many bitcoin entrepreneurs and they were all very enthusiastic about Amsterdam. They mentioned that Amsterdam is probably the place to be for bitcoin entrepreneurs because of the open and tolerant point of view of the regulatory and governmental bodies in combination with the availability of fast broadband and the large adoption of internet and social networks by citizens. Several entrepreneurs already choose to be based in Amsterdam for this reason. So maybe there is some reasoning in acclaiming Amsterdam as Capital of the Bitcoin. But one thing is for sure, whatever the future of the bitcoin is, the trend of cryptocurrencies is something to pay attention to very seriously. As one of the thought leaders of the bitcoin, Trace Mayer, stated: ‘everything that can be decentralized will be decentralized’. This makes the bitcoin part of the larger trend that can be seen in the digitalized world: collaborative platforms, like Airbnb and Uber, where cooperation takes place without (hierarchical) coordination are becoming more and more dominant.
Till Saturday May 17th more than 1200 people coming from 50 different countries will join the Bitcoin2014 at the Passenger Terminal in Amsterdam. Learn more: Bitcoin 2014, Building the digital economy