At around 3 p.m. last Tuesday, the going rate for Bitcoin — the unregulated electronic currency with increasing hipster cachet — was about $959, and climbing. Brewster Kahle, founder of the Richmond District-based Internet Archive and staunch Bitcoin promoter, seemed exultant.
Earlier that day, he'd announced that the Internet Archive's new affordable-housing complex, Foundation House, would accept Bitcoin rent payments for its apartments on Clement Street. He'd also managed to get a nearby sushi restaurant and some of his employees on board. (In April, Kahle had offered to pay employee salaries in the high-tech currency, and about one-third of them bit.) The neighborhood was poised to become a small Bitcoin fiefdom, he thought. Well, sort of.
“I keep going into the little sandwich places and asking if they take Bitcoin yet,” Kahle says, admitting that it's often a hard sell — few mom-and-pop businesses want to gamble on money that can fluctuate by hundreds of dollars in the course of a few days. Even Kahle, a self-styled Bitcoin evangelist, wishes his currency were a little more stable.
“Volatility works against [its] health as a transaction system,” he admits, noting that many people use Bitcoin for short-sales and arbitrage, but it hasn't quite caught on in the retail sphere. The few local landlords who accept it as rent payment act on enthusiasm, rather than reason; it is, after all, a form of money that can evaporate if you reformat your computer.
But Kahle seems indomitably optimistic. “It's still being debugged,” he insists. “Let's just try it.”