An empire rises, bitcoin by bitcoin
IF YOU are in the market for architectural design, building maintenance or printing, keep your chequebook in your pocket. You can use bitcoin.
The days when this virtual currency was accepted only at cafes, bars and artisan shops here are long gone.
Home-grown architectural firm Topos Design Studio, for instance, is among businesses here which recently opened up to accepting bitcoin as payment.
"It not only provides our clients with another form of payment option, but also lowers our operational costs," explained design principal Alan Fan.
Bitcoin payments, he said, do not come with transaction fees or bank charges, which are typically tagged to traditional modes of payment via bank transfers or credit cards.
"With bitcoin, we also receive payments almost instantaneously, even the international ones," added Amy Buxton, the company's business development manager. It takes at least three days to process an international bank transfer.
Said Ms Buxton: "It's a no-brainer for us to receive bitcoin as a form of payment, so why not?"
Topos Design Studio, which sees 65 per cent of its clientele from overseas, is expecting its first bitcoin payment to come in by this week.
Other bitcoin-friendly businesses here include printing services company 1800 Printer and wealth-management software solutions provider Quantified Assets.
Quantified Assets even offers bitcoin enthusiasts the option of paying their bills online - from insurance to income tax to telecom expenses - with the digital currency.
Another local enterprise called OnHand, which runs an aquaculture farm as well as provides building maintenance services, began accepting bitcoin payments a year ago.
For director Shannon Lim, the move to do so had much to do with betting on the strength of the crypto currency.
"Right now, I get to save on corporate income tax since bitcoin isn't considered a currency, while making more profit with bitcoin when its price increases," she told My Paper.
"Bitcoin is volatile, but it's undeniably profitable and makes a lot of financial sense."
Bitcoin, which traded for about US$13 at the start of last year, was valued at about US$587 (S$734) yesterday. This translates to a nearly 45-fold rise in value.
Noting that bitcoin payments have become part of the company's long-term portfolio, along with stocks, bonds and commodities, Ms Lim said that she has no plans to cash out the digital coins for "several years at least".
Barclays director of research Leong Wai Ho is not surprised that more businesses are taking on the digital currency.
"But it's ultimately a gamble, and an extremely high-risk bet at that," he said.
"It may not be a good store of value because, after all, there is no assurance behind the appreciation and no guarantee that bitcoin will continue to be accepted.
"Nothing goes up (in value) forever, especially for those that are poorly regulated."
Anson Zeall, chairman of the Association of Crypto-Currency Enterprises and Start-ups Singapore (Access), on the other hand, said that it is "just a matter of time" before bitcoin becomes widely accepted here.
Payment facilitators that convert bitcoin into the Singapore dollar instantaneously help remove any risk in terms of bitcoin price volatility in such electronic transactions, he said.
Juanita Sabapathy, a consultant with operations support provider Kolibri, is optimistic about taking in bitcoin payments by year-end.
"Can traditional currencies, commodities and such expand their trade market to include another player in the mix? If there is enough traction and stability, I don't see why not!"