There’s enough froth around cryptocurrencies to fill all the nightclubs in Ibiza many times over, but there has yet to emerge a killer app. Certainly nothing that will put the transformative power of Bitcoin in every mother’s virtual wallet, along the lines of what companies like AOL and Netscape did for adoption of the internet in the early-to-mid-’90s.
San Francisco’s Quickcoin represents the newest and one of the most promising attempts yet to getting that see-saw moving, manifesting the Bitcoin tipping point. The company’s Social Wallet allows users to send tiny increments of BitCoin to their Facebook friends. The app is as simple to use as its underlying structure is esoteric. Anyone with a Facebook account (read: almost anyone at all with an Internet connection) can now receive BitCoin of their very own, without having to navigate a murky world of libertarian fantasy and overwhelming user interfaces. It come directly to your Facebook account from a friend.
Quickcoin was conceived by Marshall Hayner and Nathan Lands over noodles at Ramen Underground in Japantown. After a rapid and serendipitous gestation it was born there seven weeks later on May 20, at the company’s launch party. Hayner and Lands had added software designer and country music impresario William Cotton as CTO, and taken on an advisory board consisting of Zach Klein, co-founder and former lead designer of Vimeo, and Jackson Palmer, co-founder and marketing wunderkind behind beloved and improbable DogeCoin.
The launch was a cozy and congenial gathering of 20 or so friends slurping noodles and chatting over beers. Conversation involving both beer and Bitcoin tends to ramp quickly into realms extreme, but the scene at Ramen Underground had only a little of William Gibson (it was in noodle house tucked inside a replica Japanese mall huddled under a concrete pagoda that looks a little like a Bernal sphere) and almost no detectable traces of Ayn Rand, DEFCON, or the Dread Pirate Roberts.
It was wholesome. Forbes’ intrepid Kashmir Hill, who has successfully lived off Bitcoin for weeks at a time, was at another table dining with her sister. Lands’ wife Noriko Nakayama Lands, co-owner of Ramen Underground, was toting the couples’ baby in a harness as she processed Bitcoin transactions and performed other maitre d’ duties.
The Social Wallet app is similarly normal and comprehensible, which is no small feat for a Bitcoin app. And the Facebook integration is a stroke of inspiration that the Quickcoin team has spent the last couple of months wringing their hands over – how has no one else done this yet?
There have been some big “Bitcoin made simple” launches recently to draw the bullets from the Quickcoiners’ pores. Circle emerged from stealth in mid-March after raising $ 9 million last fall from the likes of General Catalyst, Jim Breyer and Accel. An app called Bitcoin Armory is in a beta phase, having raised $ 600,000 and gotten some recognition at MIT’s Bitcoin Expo earlier this month. Coinbase and BitPay have both received funding in the $ 30 million range and have built popular Bitcoin transaction apps. In early May, ChangeTip debuted as a way to put a little Bitcoin behind stuff you like on Reddit or elsewhere on the internet.
With only $ 25,000 and their own bootstraps, Quickcoin has beat all these concerns to market with a Facebook integration.
The integration means that over a billion people, spread across the world, are now only two clicks away from owning their own Bitcoin and spreading it on to their friends.
It also hurdles another of the more troublesome obstacles for widespread Bitcoin adoption: jitters. Bitcoin has emerged from the fringe but hasn’t yet cleansed itself of fringe-taint. Most coverage of Bitcoin in the news has been tied to gambling, money-laundering, arms dealing, drug dealing and other muck. Stuff that scares moms, and the presumed other people who watch the nightly news. So when most of the available apps look like bizarro-Ameritrade and require dozens of clicks to get started, it confirms those previous expectations: No thanks, I’ll stick with my greenbacks.
In its first week of use, Quickcoin has mainly been used as a kind of Bitcoin evangelical engine, allowing current owners of the currency to spread their bits and satoshis around to their uninitiated friends (and moms).
While the Facebook integration allows these types of transactions to happen easily, it is a bit limiting to only be able to send to your Facebook friends. Lands says that Quickcoin will soon be available on other platforms as well, which also seems like a good hedge in case Facebook really does try to reassert its own mandatory digital currency (Facebook Credits) whereby it takes a 30% cut of every transaction. At any rate, Facebook itself grew from college to college in a restrictive environment before beating the world, so for now there’s no reason a user pool based on the degrees of Facebook separation is necessarily too small to matter.
Much of the focus on Bitcoin-related startups has been placed on apps that function like point-of-sale systems and allow customers to make in-store crypto-transactions as easily as they would using a debit card.
The problem is that, for the most part, it still isn’t that easy. Bitcoin transactions still have variable processing time, meaning either the customer has to wait until the money goes through before they can leave a shop, or the merchant lets them go before their ice cream melts, assuming the risk of a trust-based system. These are not scalable options.
The Lands know this first-hand, as the Ramen Underground in Japantown has been accepting Bitcoin payments since early spring. They don’t accept Bitcoin at the restaurant’s busier downtown location, because there’s already a line and doing so would only slow things down.
By piggy-backing on the authentication of a Facebook profile, Quickcoin could bring an extra layer of trust into that situation, similar to how Lyft used Facebook to make getting into a stranger’s car a little less sketchy.
But beyond point-of-sale type uses, Quickcoin opens up new terrain for other cases that play more to the advantages of cryptocurrencies. There’s the practice of Bitcoin tipping, whereby people can throw a little Bitcoin love to comments, photos and videos they appreciate. While this is currently a bit of subreddit exotica, it could become a way to pay a tiny amount for content, eventually replacing the fraught paywall model and dependence on advertising in online media. Where was I? Oh yes, in a rabbit hole.
There is also an opportunity for the payment of remittances that bypass Western Union and shave away almost all of the transaction fees. And… and… a way to do crowd-funding that wouldn’t limit the pool of investors to those who can be accredited as such…Oh frabjous day!
Lands and Hayner have big ideas for Quickcoin.
“We want to be like the Google of Bitcoin, with all these amazing products, one after another. The Social Wallet is just the first piece of that.”
Any Bitcoin product has to appeal to the cryptocurrency’s established user base. And that’s not easy. Lands, Hayner and Cotton have spent a lot of time over the last week responding to comments and questions in order to present a transparent and engaging face. Many Bitcoin holders have been burned recently, and there is a lot of skepticism around the privacy and the security of new transactional apps.
Naturally, integrating with Facebook doesn’t appeal to those who savor Bitcoin for its anonymity. But the security problem is a little more nuanced. There is a perception in some circles that there’s a necessary trade-off between security and ease-of-use for coin-based apps. I think its more the case that there is a trade-off between the perception of security and ease-of-use. The best security is largely invisible. Quickcoin does encourage users to upgrade to a secure account, which requires three passwords (Caution: if you forget these passwords they are unrecoverable and your coin will live forever in crypto-purgatory!) And the app is not intended to handle massive accounts.
“I don’t think that you should put a lot of money into any wallets, even real wallets. You wouldn’t probably walk around with $ 5,000 in your pocket,” says Lands.
For now there is no indication that Quickcoin is insecure, and a handful of potential snags have been hashed out over public forums and the newly installed support page. There’s been a steady climb in active users, mostly from the U.S. but also Germany and the Netherlands. It’s early days, but the app hit the ground running. Days before the launch, the team was filmed for a Korean documentary, which will be released this summer. Beyond that exposure, it’s up to you and your mom and (almost) everyone you know to decide whether Quickcoin will be a crucial intermediary between the world and Bitcoin.
Lands is cautiously optimistic. He’s been active in online community building since he ran one of the top guilds in Everquest as a 15-year-old. He’s seen past gaming-world companies he’s founded get derailed by better-funded competition, but this time around he figures he’s sitting pretty – having captured the Bitcoin/Facebook integration flag, Quickcoin now has to hold on to its base against a wide field of marauders, but it’s enlisted the support of the tightly-knit Bitcoin community and the world’s largest social network in doing so.
[image via Jon Åslund on flickr]