Los Angeles’ Meltdown Comics made headlines back in 2014 when it became the first comic book store in the country to accept payment in bitcoin. Three years later, according to the American Booksellers Association and cryptocurrency researchers, it appears that no bricks-and-mortar comic book store (or bookstore) has followed its lead.
Francisco Dominguez, the general manager at Meltdown who championed the bitcoin project, sees a simple explanation for this reluctance: “Fear. I’ve spoken to a few booksellers and that’s what’s holding them back. Since bitcoin is so volatile, they’re afraid of losing what they just made.”
Bitcoin is a digital currency that can be stored inside each user’s digital wallet. When users spend bitcoins, the currency is passed from their wallets into the recipients’ wallets, without the help of a bank or other authority. The transactions get recorded in the blockchain, a digital ledger maintained by the community of bitcoin users.
Since there is a limited number of bitcoins in circulation and there is much speculation in this relatively new currency, the value of bitcoins has seesawed wildly. During June 2016, the value of one bitcoin fluctuated between $450 and $750. One year later, the exchange rate briefly increased to an astounding $3,014. Some experts see a bitcoin bubble, while others see an unstoppable new financial force.
When Dominguez made what he said was the “mind-blowing” discovery of bitcoin, he wanted to prepare for the future of retail spending. Even though bitcoin accounts for only “a handful” of transactions per month at his store, he sees bitcoin-related traffic as a “beautiful garden in which I can plant a Meltdown seed.”
Meltdown also installed a Coin Cloud Bitcoin ATM (or BTM for short) at the store, which generated a new stream of foot traffic. Created by the bitcoin trading company Coin Cloud, the machine allows customers to buy and sell bitcoin while shopping for comic books. The BTM gets more than 10 visitors every day. “That’s a lot more than the company that installed it was expecting,” Dominguez added. “I’m their most-visited BTM in Los Angeles.”
One bitcoin expert compared booksellers’ slow adoption of bitcoin to the early days of the internet revolution. “Bitcoin is still not very intuitive,” said Ofir Beigel, owner and editor of 99 Bitcoins, a reference site about the currency. On the site, Beigel maintains a long list of retailers accepting bitcoin. “It’s a very technical subject, the same way the internet was in the beginning. People didn’t understand what email was. Since bitcoin’s not mainstream, business owners are a bit hesitant to start adopting it.”
A new wave of bitcoin companies is making it easier for booksellers and other retailers to adopt the digital currency without fear of volatility, however. Rather than directly processing bitcoin, Dominguez uses BitPay to handle bitcoin transactions at his store. The company makes the digital currency exchange and pays retailers in dollars.
According to Dominguez, most of Meltdown’s cryptocurrency visitors are “first-time bitcoiners” interested in learning. “Even if it’s just a small sale,” he said, “the curiosity of the transaction makes them use it.”
“Personally, I think we are on the brink of hitting mass adoption of bitcoin,” said Beigel, citing the technology adoption life cycle, a concept formulated by organization theorist Geoffrey Moore. Currently, only early adopters make use of cryptocurrency, but Beigel believes our culture will soon “cross the chasm” that separates the “early majority” from these early adopters. “In the next one or two years, things are going to change drastically,” he predicted.
If bitcoin crosses that chasm, it will have profound implications for all retailers. Author and bitcoin expert Andreas M. Antonopoulos calls cryptocurrency “the internet for money.” Bitcoin boosters believe that someday all financial transactions will be carried out through a decentralized digital currency platform, just like the internet now handles much of our communication. In this utopian vision, no bank or country will govern financial transactions—only the community of users will.
“Don’t be scared,” Dominguez advised other booksellers. “Cryptocurrency is going to be a thing. You have to jump in to any source of income you can bring to your establishment.”