These days you won't have any problems spending your bitcoins. You can book flights, buy apartments and eat and drink your way through most of the world's major cities. But three years ago things were different. Then you had to fly to Berlin and make your way to a small bar in the city’s Kreuzberg district if you wanted to spend bitcoins.
Room 77 in the German capital is celebrating three years of accepting the cryptocurrency. The exact date is not really clear but the owner of the bar, Joerg Platzer, approximated that it was around May 2011 that he accepted the first bitcoin transaction for a beer.
Unless challenged, he will continue to claim that it was the world's first purchase with the digital currency in a shop, restaurant or bar.
Then and now
Back then, Platzer explained, he was happy if he had one or two bitcoin purchases per month; now he has up to 10 purchases per evening.
Back then people would turn up with their laptops and manually type in the address codes to make transactions; now young hipsters show up with their smartphones and make transactions like it’s the easiest thing in the world.
Back then Platzer would be ecstatic if four people showed up to a bitcoin meetup; now his bar fills up on the first Thursday of every month when the local enthusiasts meet.
Platzer described himself as an old-school “hacker, lock picker and phreak”. In his circles there was talk of a decentralized digital currency for years, and when he heard about bitcoin for the first time he knew he was on to something big. He said:
“I felt 20 years younger. This was the sort of money I read about when I was young. I just said, 'lets go for it'.”
He put up a sign advertising that bitcoin was accepted in the bar, and waited for the first customer. And waited, and waited.
“Everyone was laughing about it and people were asking 'what is this funny bitcoin stuff [that] was on the wall'. The staff just shook their heads and said it was some strange thing the boss liked.”
Accepting bitcoin in those days was not a business decision. Of course there were the advantages of low transaction fees and not having to handle cash but in the end, it was very much an ideological decision, Platzer said. He looked for a way to decrease the power of the banks, and given the small scale of his bar, he thought he'd found a way in bitcoin.
“In my opinion our society has a huge problem and that is called banks and central banks – and we need to overcome those structures ... We are now looking at a future where no one will have to use banks anymore and that means that we can let a bank fail.”
Ideologues vs Entrepreneurs
But over the last year a new type of bitcoin enthusiast has entered Platzer's bitcoin world. A typical bitcoin user is now as likely to wear a smart suit and work in an office as he is to wear a hoodie and argue for the end of capitalism. The bitcoin entrepreneurs have arrived and Platzer isn't all that happy about it.
People became attracted to bitcoin because it offers a free or low-fee transaction and a lack of regulation, but now, he said, some are arguing for more regulation as a way to legitimize the currency in the eyes of financial institutions and governments. Said Platzer:
“I look at these entrepreneurs and say, ‘You want something regulated?’ You have something regulated. It is called money – just use that.”
Platzer is certain his side will win the fight over regulation. There is no way to regulate bitcoin, he contended, as it goes against the coding. But more importantly, if the regulation side succeeds, people could just move to the next altcoin. “The genie is out of the bottle," he said, "there is no going back anymore.”
As the history of bitcoin continues to be play out across the world Platzer sits back in his own bitcoin kingdom smiling. He said:
“Bitcoin is still an experiment ... That’s why I think it is funny that people demand stability. You can’t demand things from an experiment. Just go and pay with your MasterCard if you want stability.”
Photos by Jona Kallgren