A seemingly down-to-earth eatery off street 360 has become the first place in the Kingdom to accept payment with the popular virtual currency BitCoin
Down an alley off Street 360, a seemingly ordinary shop-house restaurant, like hundreds of others in Phnom Penh, provides neighbours with a coffee fix or bowl of rice porridge.
But this seemingly run-of-the-mill restaurant wrote a footnote in Cambodian business history this month when it became the first in the Kingdom to accept a payment in the digital currency BitCoin. “A couple I met on Reddit got two coffees for 5,000 riel,” said Steve Menger, owner of Coin Cafe, with a laugh. At the time that they visited the cafe, 5,000 riel was worth about 0.0033 of one BitCoin.
While BitCoin’s presence in the Kingdom is near nil, a small group comprised mostly of foreigners evangelise the crypto-currency as a superior alternative to the dollar or riel.
“Software is decentralised, collaborations are happening all around the world, and I think BitCoin is the future,” Menger said.
BitCoin, which was first created in 2009, is a completely decentralised online currency with no direct oversight by any regulatory agency. Using software known as a digital wallet, users can give BitCoins to other users directly instead of using third-party services.
Coins can be purchased from other users or on a BitCoin exchange which tracks the currency’s market value. As of yesterday, the exchange rate was one BitCoin for $353.2.
Grant Knuckey, chief executive of ANZ Royal Bank, said the absence of sovereign backing – which would normally be provided by a national central bank – made BitCoin interesting.
“It does, however, have most of the other aspects of a currency,” Knuckey said, adding that it’s currently more of an “interesting concept than a reality” in Cambodia.
But at Coin Cafe, purchases can be made on mobile phones by photographing a laminated QR code taped onto the wall and using a digital wallet to transfer the coins to the corresponding account.
Menger admits that the cafe, which opened last month, is unlikely to become a centre of BitCoin trading. While the government has not banned BitCoin, the National Bank of Cambodia announced it March it would not recognise the crypto-currency.
Merger hopes, however, that his website, bitcambodia.com, will become a viable method of exporting Cambodian products throughout the world via BitCoin payments. Business has not yet taken off – he has yet to make a sale – though he hopes other Cambodian businesses will soon take notice.
Ki Chong Tran, a 26-year-old 3D printing specialist based in Phnom Penh, said he hopes BitCoin will transcend traditional banking in the Kingdom much the way mobile telecommunications leapfrogged over landlines in the 1990s. E-commerce – which is currently limited in Cambodia – could be revolutionised even before a PayPal analogue appears.
“In a developed country, there’s already a pretty good banking system, whereas here there is hardly anything,” said Tran, adding that migrant workers in the cities would have a much easier time remitting money to their families with BitCoin.
But Tran admits that for all his enthusiasm, his BitCoin savings could evaporate overnight. “I’m a pretty realistic guy, I think it could end any minute. But it can potentially go so high, and I’m young still, so I can take the risk.”