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Smart Property is One Small Step Closer with Coincollectr Prototype

Op-ed - Smart Property is One Small Step Closer with Coincollectr Prototype

When I walked into Matt Branton’s downtown office in early March to talk about his Bitcoin-based content micropayments system Coinlock, he was shopping for plumbing equipment. At least that’s what it seemed like – he was on some obscure web store browsing valves, levers, tubing, t-joints, and whatnot (if you can guess, I know nothing about plumbing). This seemed odd for a Bitcoin developer.

As it turns out, Branton was getting ready for Tampa’s Startup Bus 2014, which was to leave for South By Southwest just a few days after our meeting. He was browsing for tubes and valves because he was going to try and build something on the Startup Bus. He was trying to build something amazing. He was trying to build something glorious.

He was trying to build an automated beer tap that accepted Bitcoin.

The idea was to build a gadget that would allow SXSW attendees to pay an unattended machine with bitcoin, and have frosty brew dispensed automatically. The machine would have to interface with the blockchain through a wi-fi signal and direct payments to a pre-selected address. Partiers would get a beer, and a merchant would get their money, all without any active human intervention.

Well, you know the saying – always aim for the moon. Even if you miss, you’ll land among the stars. The saying may be weirdly astronomically inaccurate (shouldn’t it be the reverse?), but it proved true here. Branton set the beer tap idea aside, even though it was sure to be a hit among the sun-baked SXSW technorati, because, he said, “the complexities of dispensing liquid beer at 70 miles per hour seemed like a recipe for failure.”

Instead, he and partner Jeff Kinsey focused on the underlying element that would make a beer dispenser and other applications work – a physical bitcoin point of sale unit. The design sensibility is pure back-of-the-bus: Coincollectr’s prototype lives in a Tupperware container, jazzed up with glitter. Inside is a small unit with a wi-fi connection that monitors the blockchain for payments to a designated address, along with a green LED light.

Unlike a traditional point of sale system, Coincollectr is actually a payment monitor rather than a payment processor. Vendors using the system would simply display a Bitcoin address, probably in the form of a QR code, and a designated amount. When a payment meeting the minimum threshold is posted to a designated address, Coincollectr flashes its green light.

Branton cites some typical advantages of bitcoin payments: low costs and easy access. If mass produced, Coincollectr would be far less expensive than the tablets and smartphones currently used to process most bitcoin transactions (though also, it would seem, a bit more limited if it were not connected to an interface).

But the main advantages come when you take a system like Coincollectr out of the store and into the wild. Coincollectr’s light-indicator system is already enough for a functioning Bitcoin tip jar or parking meter, but the further possibilities are huge. Coincollectr, or something like it, will be the core of the so-called “smart property” system that cryptocurrency will enable.

Smart property means a network of flexible payment systems and smart contracts mechanically embedded in physical goods, allowing consumers to buy, rent, or share items without needing a human to monitor their usage. A Coincollectr unit, connected to some sort of physical output, would allow a Bitcoin payment to open a rental locker door, say, or start a rental car. The smart property concept was first advanced (in a paper viewable here) by none other than Nick Szabo, occasionally suspected of being Satoshi Nakamoto.

The first thought someone familiar with Bitcoin is likely to have when thinking about a bitcoin POS system is the transaction time problem. But the Coincollectr prototype uses zero-confirmation transactions, which are already in use by reputable servicers like BitPay.

Branton says the cost of parts for the Coincollectr prototype, including wi-fi connectivity, was under $50. Achieving smart property functions (such as dispensing beer) would in most cases require a good deal more hardware and design work, but with the bitcoin guts in place, engineers will be able to take applications in any number of directions.

Unfortunately, Coincollectr in its current incarnation didn’t advance past the semifinal round of the Startup Bus competition, most likely because the far-ranging potential applications for smart property are still a bit abstract for a lot of people – even techies – to wrap their heads around. But Branton submitted the project to the Techstars accelerator, and is currently considering a Kickstarter to help him bring the project to full production.

Branton admits that the current incarnation of Coincollectr “looks like it was built at a truck stop” – which it was, during a breakdown on the Startup Bus’s way from Tampa to San Antonio. “There’s a statement about humble beginnings in there somewhere,” says Branton. As excited as some of us might be, bitcoin is still early in its development, a time when a lot of great new things are going to come in rough-edged packages. Automated point of sale systems like Coincollectr are inevitably going to be a major part of cryptocurrency’s impact on our day-to-day financial lives. What it looks like right now is not nearly as important as the power of the idea that it’s making into reality.