Bitcoin may not be subject to artificial inflation, but the goods you can pay for with it may be.
Once seen as the currency of the black market, the value of the Bitcoin shot up to $600 this week after the Department of Justice and Securities and Exchange Commission acknowledged the hard-to-trace virtual currency as "legitimate."
Now, as the coin rolls its way steadily into the realm of public awareness, an increasing number of businesses are starting to accept the stateless cybercurrency as payment for their products and services. One of those is Miami's Vanity Cosmetic Surgery which claims they are the first and only medical center in the world to allow clients to use their loaded Bitcoin accounts to pay for procedures online including boob jobs, liposuction or even laser hair removal.
"There's been a lot of interest, mainly from men," said Carlos Yela, Vanity's advertising manager, who first pushed the idea to management. "The reason we did this was to attract people out of state and internationally who are seeking new payment options."
Vanity, which has three surgery centers in South Florida, has received at least 12 inquiries about bitcoin payment since they began offering it two weeks ago. But as the service is still relatively new and preparation for typical cosmetic procedures can take between one or two months to finalize, Yela says the clinic is still waiting to secure its first coin.
Despite the clinic drawing a majority of female clients, all of the enquiries about the new payment method have been from men looking to finance their nose jobs, liposuction, facelifts and autoplasty (ear pinning surgery). Yela puts this down to males being "more into technology and computers."
"At this stage, it's accessed more by people who are computer savvy and who are into technology and trading," said Yela. "We expect as time passes it's going to become more popular."
Because the bitcoin currency itself is distributed among all of its users, there is no centralized bitcoin bank. Instead, people buy and sell bitcoins by visiting websites, finding a user willing to sell them some bitcoins, and then directly wiring them money. New buyers must wait until their money transfer is cleared, a couple of days, before they actually see the bitcoins appear in their account or "wallet." The same applies to sellers looking to cash out, but having to wait for their payment to arrive.
Last month, a coffee shop in Vancouver, Canada installed the first bitcoin ATM to mitigate this problem and speed money transfers. As well as withdrawing money, customers can feed cash directly into the machine to deposit as bitcoins. The move has boosted the cybercurrency's growing authority and legitimacy, although the US government remains hesitant to welcome bitcoin into the American marketplace.
Currently, bitcoin wallets are not afforded the same protections as banks by institutions like the FDIC, meaning that if your coins are stolen by hackers, there is no financial redress.
To minimize potential losses, Vanity says once clients start dropping coin, it plans to exchange the currency into cash immediately. They're also capping bitcoin payments for first time clients at up to 20 percent of the cost of their surgeries, while returning clients can pay with bitcoin in full.