Bitcoin boom spreads to Las Vegas brick-and-mortar businesses By David Ferrara, Las Vegas Business Press May 5, 2014 at 10:36 am Should an economic collapse ever ruin the U.S. dollar, you could still shop for your cataclysmic needs at the Zombie Apocalypse Store. Behind the door protected by wrought-iron bars and near a couple of machetes, black and orange signs read: “Bitcoin accepted here.” Monko decided to start dealing in Bitcoin about six months ago. He said he’s constantly mixing things up at the store. “I thought it might open us up to a new market,” he said. “It fits with that we’re not afraid to take on new things.” Since then, only four purchases have been made with Bitcoin, mostly from customers in their 30s, and Monko has held onto the currency instead of converting it to cash, but he’s seen rising interest from customers. “We haven’t had enough sales to determine a trend, but it seems like it might be picking up,” Monko said. “People are certainly getting aware of it.” GETTING TO KNOW BITCOIN A driving force behind the enthusiasm for digital currency in Las Vegas: Julian Tosh, a senior systems engineer at an office building near McCarran International Airport, who runs a Bitcoin consulting business on the side. Just about every week for the past year and a half, Tosh has gathered a group for lunch to talk Bitcoin and hopefully persuade restaurant owners to start accepting the digital currency, if he hasn’t already done so. He recently launched bitcoinsinvegas.com, which lists about three dozen valley businesses that accept the virtual currency. The directory’s Facebook page has grown to 141 members and its Twitter page has more than 530 followers. “Our goal is to help people understand Bitcoin and learn how to use it. Share what we know,” Tosh said. “It’s getting easier because people have heard the word before, and there’s more curiosity about it. If they haven’t accepted the idea, we’ll engage them, give them a way to see that people are interacting with the currency.” Tosh owns a dozen black Bitcoin T-shirts emblazoned with an orange B and the words “Ask me about Bitcoin.org a digital currency.” He wears that shirt every day, even at his day job, and he can talk for hours about Bitcoin if you let him. On his right arm, he wears a white Bitcoin wristband with the words “In crypto we trust.” He carries cash and credit cards in a Bitcoin-themed wallet, and the change jingling in his pocket is a collection of 1-ounce silver commemorative Bitcoins, not quarters and dimes. At home, he keeps a silver aluminum Bitcoin briefcase, which converts pocket change to the digital currency for demonstrations. He had a B cut out of the steel luggage rack on his Honda Goldwing motorcycle. “Anything that has Bitcoin on it, I’m collecting it,” he said. “Cryptocurrencies are here to stay.” BRINGING IN NEW CUSTOMERS And the big players are taking notice. The D and Golden Gate made national headlines in January after owner Derek Stevens announced he would start accepting Bitcoin for nongaming transactions. Slotzilla, the Fremont Street zip line that opened at the end of April and zooms past Stevens’ casinos, also is expected to take Bitcoin. Although the virtual currency remains a small percentage of his business, Stevens said transactions bring in new customers every day, and he’s “enthusiastic” about the future of the alternative payment option. He uses a payment processor called BitPay, which immediately converts the currency to U.S. dollars. “I’m pretty excited how it’s played out,” Stevens said. “It’s not a technology that can be dismissed that easily.” IT PAYS THE RENT No one has yet purchased a house or condo through Haeran Dempsy Real Estate with Bitcoin, but a few folks have made partial mortgage and rental payments, said Martin Dempsey, who manages the company named for his wife. He said accepting the digital currency helped attract a few new tenants in the past couple years. Occasionally, he will sit down with clients and help them through the process of setting up an online wallet. Tenants without bank accounts prefer to make rent payments in cash, he said, but earlier this year, Chase Bank stopped accepting cash deposits from anyone not listed on the account. He doesn’t want to accept credit card payments because of the fees. “Bitcoin. Problem solved,” he said. “There’d be no market for Bitcoin if the rest of the market ran smoothly. Dealing with banks and dealing with credit cards has been painful for me. So Bitcoin was a breath of fresh air.” MARKETING OPPORTUNITY Rocket Fizz Soda Pop and Candy Shop owner Damian Barton offers 20 percent off a purchase to anyone who uses Bitcoin. He saw the first Bitcoin transaction at his Summerlin store in 2011, but most of the virtual currency business has occurred within the past six months, from one customer a month who wanted to use Bitcoin to about one a week. Now, he plans to start accepting the virtual currency at his Henderson shop. “The more businesses that accept it, the better off we all would be,” Barton said. “The more people use it, the more businesses will accept it.” Bitcoin appeals to his younger clientele — “the cutting-edge-idea people, the tech-nerdy crowd” — of which he considers himself a part. He likes the simplicity of Bitcoin transactions and that there are little to no fees. “I’m hoping that Bitcoin is something that can perhaps change the way we do business,” Barton said. “That’s a big step but it definitely has the potential.” BITCOIN’S VOLATILITY Late last month, the Nevada Business and Industry Department recognized the increased popularity of Bitcoin and other digital currency, offering guidance for consumers and investors, and explaining “risk factors associated with transacting or investing in virtual currency.” A news release from the Financial Institutions Division pointed out that virtual currencies are neither legal tender nor backed by a central bank. “Virtual currencies have legitimate purposes and can be purchased, sold and exchanged with other types of virtual currencies or real currencies, like the U.S. dollar,” the Business and Industry Department’s release stated. But, the release said, virtual currencies are volatile, “can be stolen or otherwise subject to loss … have been connected to criminal activities.” Also: “virtual currencies and companies dealing in virtual currencies may or may not be regulated.” The Internal Revenue Service announced in March that virtual currency should be treated as a capital asset. “Do your homework,” the state’s release said. “Consumers considering the use of virtual currencies should research any company offering services related to virtual currencies.” MAKING TRANSACTIONS EASIER In January, just after taking over Sunset Pizzeria on West Tropicana, Sven Oberlaender created a Bitcoin processing machine to simplify digital currency transactions for staff and customers. It works similar to a credit card terminal. The cashier punches in the total, and the machine spits out a receipt with a QR code for the customer to scan. Oberlaender is still tweaking the software, but his site btcpos.org calls it “the ideal and professional solution to accept Bitcoin payments in a restaurant or retail environment.” He said the software may be licensed within a few weeks. Anywhere from 15 to 20 tickets are printed each month at the pizzeria, and Oberlaender said accepting the digital currency makes for good publicity. “And it’s real money,” he said. “There are some people who have a lot of Bitcoins from the early days, and they don’t know what to do with them. You can buy a real pizza with it. That gives people real confidence. That brings it out of the realm of being an online hacker currency.” Contact reporter David Ferrara at 702-387-5290 or email@example.com. Follow @randompoker on Twitter.