On March 24th, Israel’s most reputable exchange entered the booming Vietnamese market.
Israel & Bitcoin: Fertile Ground
Bit2C Ltd, one of Israel’s largest bitcoin exchanges, was born only one year ago. When Co-founder and CEO Eli Bejerano was introduced to bitcoin, he saw potential for it immediately. Initially, he wanted to create a news site for bitcoiners, but written in Hebrew, since most of the information on the innovation was in English. However, his idea quickly transformed from a bitcoin news site to a bitcoin exchange, where Israelites could buy and sell the cryptocurrency:
“We noticed that Israelis needed to take their currency and [transfer it] into dollars and send it abroad,” Eli explains. So, he teamed up with Haddar Macdasi, now Bit2C’s Chief Technological Officer, and created a real-live exchange: “We have our own market based on supply and demand here in Israel.”
By Eli’s estimate, Israel is one of today’s biggest bitcoin communities in the world. Israel hosts the world’s “biggest or second-biggest” meetup group with over 200 businesses accepting the currency. The country currently boasts over 100 start-ups centered around Bitcoin technology: “You can buy almost everything with bitcoin; restaurants, computer shops, barbers, bakeries, garages,” Eli explains.
Israel offers a fertile ground for the flourishing of bitcoin since its populace is interested and innovative in both finance and technology: “Israelis,” says Eli, “they like tech and they like finance. There’s a big and respectable community [here] around bitcoin.”
Yet the environment is not exactly ‘warm’ to the innovation. The Bank of Israel recently issued a statement warning about bitcoin; from the Israeli bitcoin community’s point of view, they figure that Israel will follow suit with the United States’ decisions on the currency. Recently, the USA issued an announcement that Bitcoin would be taxed like a capital gain: “Some see this as good news, some see it as bad,” Eli reflects. “Even if people want to do what the law offers to do, it’s going to be very hard to track everything with bitcoin.”
Even given the potential obstacles, Bit2C has been very successful in the past year, mostly due to their safe and secure bitcoin storage process: “our technology is very unique, because not a lot of exchanges around the world use cold storage. We use cold storage for 95 of [our] bitcoins, so even if it gets hacked, no one can access [them]. We can never get ‘Goxed.’”
This very attribute has garnered the company massive global attention; however, Eli and his team decided to focus on the incredible Vietnamese market for their first international launch.
The idea to expand into Vietnam was developed over a bitcoin-purchased beer in an Israeli bar. Eli’s friend, Dominik, a German bitcoiner, understood the opportunity for bitcoin in Vietnam, as his wife is Vietnamese. Both men saw the opportunity to implement Eli’s coveted technology in Vietnam and overcome the language barrier by using Dominik’s unique connection: “The main problem is the language barrier. We will supply the technology, and Bitcoin Vietnam Co. Ltd will supply the presence. [When] they have a site in place that communicates in Vietnamese and trades bitcoin [using our technology], it will be a great success.”
Bit2C’s stress-tested and proven technology comes at a dire time for Vietnam. The country is a quickly-expanding market, with over 80 million people suffering from the effects of inflation: “a big percentage of [Vietnamese people] h
ave money, but don’t know where to put it,” Eli explains. “Real estate is [expensive] there, and the price of living is very high [due to] inflation.” Adopting bitcoin allows Vietnamese people to retain the value of their money.
Furthermore, using bitcoin saves an incredible amount on remittances; this is of massive importance because the Vietnamese population overseas is “over 4 million people, [making it] a top 10 country in the remittance market with more than 10.6 billion dollars a year in incoming transactions,” Dominik explains. “It really is a pain in the ass for many Vietnamese people to bring and send money home to their families. Bitcoin will change this dramatically.” Eli adds that the importance of having this technology in the Vietnamese language will make this easier for the people to adopt.
The Beginning for Vietnam
Bitcoin Vietnam Co Ltd. began operations after the famous Bitcoin Bar Beer Discussion and just signed the formal contract with Bit2C on March 24th. According to their joint press release, “Bitcoin Vietnam Co Ltd. will enable bitcoin users in Vietnam to buy and sell an unlimited amount of bitcoin.” It is assumed that after their beer, Dominik spent 6 months working with local Vietnamese to find and create the company. Nguyen Tran Bao Phuong was made CEO of Bitcoin Vietnam Co. Ltd, and “strongly believes” that this strategic partnership will “set a milestone in the … development of Vietnam’s… bitcoin economy. Vietnam is aiming to become a technological hub in the region, and we believe that… adoption… will play a key role in bringing Vietnam’s economic development to the next world.”
The company will actively comply with “all applicable rules and regulations” regarding Bitcoin in Vietnam, using “high standards” of Know Your Client and Anti-Money Laundering measures to “prevent illicit usage of the company’s services.” Through their partnership with established Bit2C, the Vietnamese exchange understands the need to actively comply with strict security measures and co-operate with government authorities.
Bitcoin Vietnam Co Ltd. and Bit2c Ltd.’s exchange will be called VBTC and will officially offer access to reliable and secure state-of-the-art solutions regarding bitcoin. Although Vietnam’s media reports claim the State Bank of Vietnam “opposes” bitcoin, the technology has never been prohibited in the country. The usage and understanding of Bitcoin in Vietnam is in its early days, but the “community and interest is expanding at a rapid pace.”
Already, a handful of companies and brick-and-mortar stores accept Bitcoin for products and services. The Vietnamese bitcoin community is forming a Bitcoin Vietnam Foundation to educate the public, regulating authorities and professionals on the merits and uses of bitcoin. The foundation will hold the first nationwide Bitcoin Conference on May 23rd, 2014, a date specifically selected to follow the traditional and well-established Banking Vietnam 2014 conference, which is focused on more traditional forms of currency.
This development is huge news for the bitcoin community. As Andreas Antonopoulos says, even if this is a fad for the 1 billion of us with bank accounts, this is incredibly life-changing for the “other 6 billion. Focus on the other 6.5 billion.” This is where the true world-changing potential lies.
Vietnamese bitcoiners can expect to be able to access the exchange in late April. Eli and his team are doing incredible work. Stay tuned.
For more information, please contact:
Nguyen Tran Bao Phuong; Chief Executive Officer
Bitcoin Vietnam Co., Ltd.
129F/123/52A Bến Vân Đồn
Phường 8, Quận 4
Thành phố Hồ Chí Minh
Eli Bejerano; Chief Executive Officer
Tel Aviv, Israel
Victoria is a partner at Bitcoin Strategy Group, and a contributor to Bitcoin Magazine, CoinDesk and CoinTelegraph. Victoria helps Bitcoin businesses with community development and marketing.