A plan to build the "world's largest" local bitcoin-based economy is underway in the city of Launceston, Australia, with support from local businesses and even government.
Project organizers say the compact Tasmanian city with a population of 106,000 will make a good high-density testing ground for bitcoin. The plan is aimed to cover various levels of the business supply chain, allowing users to both receive and spend their bitcoins, rather than simply converting them to Australian dollars.
A notable part of the 'Launceston Launch' plan would be to have the local government, the Launceston City Council, accept bitcoin for taxes and rates. At least two members of the 12-member council have shown support for the idea.
Plan director Adam Poulton has talked of bitcoin's potential to put the spotlight on a city not often seen in international headlines, saying:
This, along with several tourism and real-estate projects, plus a social media campaign, would hopefully attract more affluent tourists to the area, who would in turn be encouraged to spend bitcoin there.
Launceston Launch is designed to be a mainly closed-loop system, beginning with traders accepting digital currency and then targeting other merchants up the supply chain, keeping most of it within the city as its cost-saving benefits are realized.
Gold sponsors signed
At least two supporting businesses have signed up for the project's Gold Sponsorship, including Dr Roger Bernard, a medical clinic operator who has studied bitcoin since early 2013.
Bitcoin could also open his practice to international clients and help sell his skincare products overseas, he added.
A public education campaign is also underway to raise awareness of the project, coordinated by Melbourne-based bitcoin activist and documentary maker Dale Dickins. There are also plans to install four bitcoin ATMs around the city centre, with more to follow if the project proves a success.
Marketing efforts would initially target female consumers aged 25–45, as the demographic with the highest percentage of smartphone usage and who visit the widest variety of shops.
Initial responses from local businesses had been positive, Poulton said. Despite overall awareness being low, most begin to see bitcoin's potential for savings and convenience after an informative 15-minute chat, he added.
Issues discussed include that fact that bitcoin is not too complex technologically, the Australian Tax Office has confirmed legality with a ruling, it integrates well into an e-commerce site and merchants would have the ability to cap the number of bitcoins they receive if needed.
Some concerns have stemmed from businesses not knowing what to do with a sudden influx of bitcoin-using customers. The 'Bartercard' local currency initiative of previous years caused headaches for some small businesses who collected the system's trade points, but complained they were unable to spend them on practical expenses like taxes and supplies.
This is not an issue with bitcoin, Poulton said, since payment processors like BitPOS are ready to exchange bitcoins for dollars if needed and a sudden jump in bitcoin trade is unlikely.
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.