Do You Take Bitcoin?

I've discovered that the Bitcoin is a new, virtual currency. Unlike the peso, the real or the pound, it's not run by a central bank. It doesn't have a picture of the Queen or, in the case of Brazil, nice pictures of animals. Instead, it only exists online.

You leave the country for 10 minutes and suddenly there's a new currency?

That's how I felt after a recent trip to Mexico and Brazil. I came back with currency on my mind as I wondered whether to keep or exchange my Mexican pesos and Brazilian real. Perhaps that's why I started noticing stories about a strange new thing called the Bitcoin.

Apologies if Bitcoin is old hat to you and you're already paying for your dry cleaning with it, but to me it needed some explanation.

I've discovered that the Bitcoin is a new, virtual currency. Unlike the peso, the real or the pound, it's not run by a central bank. It doesn't have a picture of the Queen or, in the case of Brazil, nice pictures of animals. Instead, it only exists online.

It was created four years ago by an anonymous computer scientist who goes by the name of Satoshi Nakamoto. So far, so mysterious.

Its value has been yoyo-ing around. It was once worth just a few cents, then rocketed to over $260 in mid-April and, as I write this, seems to be around $100.

I then came across an article about someone trying to live on Bitcoin for a week. Kashmir Hill documented her experiences in the business magazine Forbes and it made for an agonising read as she had to go without public transport and struggled to find food. It seems that not many places are Bitcoin friendly yet. She was writing from tech-loving San Francisco and I'm sure things are even worse here in the UK.

It got me thinking about currencies and how different they are to most of the choices we make. Each day I decide which of the many coffee chains will be my preferred stop for a latte. When it comes to how I pay though, I have no choice. If it's London, it's the pound.

But what if that could change? What if these new borderless brands were accepted everywhere and I could suddenly choose not only where I spend my money, but which currency to use? What would the Bitcoin need to do to make me choose it?

Any currency looking for a long term future could benefit from some of the lessons of branding. What are they? Well, if you google "what is a brand" you'll find hundreds of definitions.

For me, a successful brand has three key qualities. It should be visually distinctive (I recognise it), it must be trustworthy (it never lets me down) and I must like it (I want to have it in my life). So I love Virgin Atlantic (it ticks all three boxes) but I'm not such a fan of, let's say, some of the low cost carriers.

So how does Bitcoin do? Is it visually distinctive? Not yet. There's no clear logo, nor even a nicely designed website. It still seems to exist in the shadows.

That has an impact on the second quality, whether it's trustworthy. I want to feel that the Bitcoin is solid, but it still feels a bit hesitant and lacking in legitimacy. Could it suddenly disappear overnight? What if the price crashes again? In her article on the challenges of living on Bitcoin, Kashmir Hill meets Fred Ehrsam of the Bitcoin broker Coinbase. He tells her that building trust in a digital currency is a big challenge.

So do I like it? Not yet. I don't really know what it stands for. Pus, there's been talk of it being popular in drug deals and other shady transactions. I'm not sure that's a look I'm keen on. The Bitcoin needs an image overhaul before I'm happy to be associated with it.

One things is clear though. Currencies will look different in 10 years to how they look now. We can now go online to shop at stores we would once have needed to get on a plane to visit. It seems like our choice of currency could also be about to get much bigger.

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