Las Vegas. Tremendous wagers are commonplace in this town, and have been for decades. Big bets on cryptocurrency--those are a bit more unusual.
This explains why a local poker players recent investment into bitcoin ATMs has turned so many heads. The entrepreneur, 29-year-old Chris McAlary, essentially has pushed all-in on the virtual currency, using the entirety of his liquid assets to found Coin Cloud, a nascent company that operates ATMs for bitcoins.
McAlary's believes in bitcoin's future as the currency of choice for gamblers. And there is a confluence of factors that might make Las Vegas the perfect place to push bitcoin into mainstream use--if McAlary and like-minded entrepreneurs prove out its use on the Strip, casinos around the world are poised to make bitcoin its currency of choice.
Theres no question that cryptocurrencies such as bitcoin have the potential to be one of the most important innovations of the 21st century, says McAlary. Las Vegas could be one of the places that really helps drive it all forward.
Specifically, McAlary's company uses ATMs that are Internet-enabled kiosks that allow users to buy or sell bitcoin. The machines that went online this summer are in a particularly prominent spot, steps from the busiest part of the Las Vegas Strip. In the first few weeks, the machine outperformed even McAlarys most liberal estimates. After 45 days, the Vegas machine overtook the a bitcoin ATM in Vancouver as the No. 1 performing bitcoin ATM in the world. McAlary wont say exactly how many transactions the machine has handled so far, but hints that volume is already has surpassed $1 million.
While the cryptocurrency has yet to find a home in the average Americans wallet (so to speak), businesses appear to be getting more serious about it. In early September, Braintree, the online and mobile payments platform owned by PayPal, announced it would integrate bitcoin into its business. Other companies, including Expedia, Overstock.com, and Amazon.com also have announced they will accept bitcoin as a method of payment. (Full disclosure: I run a travel blog for Expedia.)
In Vegas, however, especially on the Strip, bitcoin has even more going for it. First of all, because so many people visit Sin City every year, the market attracts a high volume of people looking to spend money. The Viva Vegas souvenir shop, in which McAlary has placed his first ATM (he calls it the Bitcoin Bodega"), sees more than 100,000 people a day in foot traffic. Las Vegas also draws an international clientele who want to access their money instantaneously, and to gamble without paying transfer fees to centralized banks.
In other words, Vegas is primed for a bitcoin run.
What is bitcoin? The answer is more complicated than you think (and more complicated than we journalists usually report). Unveiled in 2009 (the identity of the creator is up for debate), the cryptocurrency is an online payment system that was introduced as open-source software. Under the protocols of this technology, payments are recorded in a public database, which is known as the blockchain. Because these payments work without a central repository or single administrator (a.k.a., a bank), the U.S. Treasury considers the currency to be decentralized and virtual.
(Also, because the currency is virtual, users must obtain a virtual wallet to help record transactions and securely buy, use, and accept the stuff.)
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