Created: 12/26/2013 6:20 PM WHEC.com
It's a controversial method of payment that has made its way all over the world, and now it's being used more and more in the Rochester area.
It's called Bitcoin and it is a form of electronic money. You can think of it as a "digital wallet.”
Advocates say it's easier to transfer money without the hassle of paying transaction fees.
But the system has also been scrutinized by law enforcement officials, including the FBI. They say Bitcoins have been used by criminals to move money around the world.
So now that it has made it's way into our area, News10NBC wanted to hear from people who are promoting the network.
Experts say this system is perfect for people who don't like to use banks. It also allows people using it to remain anonymous.
But the big question is, does that open the door for criminal activity?
A local financial expert says the jury is still out.
“Ultimately, I think everyone has a lot to learn about this. There is an incredible amount of speculation, an incredible amount of uncertainty. Whether or not it will be recognized as a currency or whether or not it will be recognized as security is a big question in and of itself,” said Ethan Wade, financial advisor at Brighton Securities.
Despite the questions, the network is becoming more popular. Billions of dollars have already been transferred all around the world. The transactions are usually made online or you can go into certain stores to make transactions.
Ridge Coin and Gold Exchange on east Ridge Road is one of the very few locations outside of New York City where you physically use Bitcoins to transfer money. It's kind of like going to a bank, but again, you remain anonymous and you don't pay fees.
Even though it's anonymous, News10NBC is told there is still a record kept of all transactions.
News10NBC wanted to know what the company had to say about the FBI's concerns and what it means for Rochester.
“They have found criminal activity with it. What do you say to the people who are worried about that in Rochester?” asked News10NBC's Joangel Concepcion.
“Are you worried about criminal activity when you use cash? I mean, you can walk into any store and use cash. Cash can be used for good, as well as it could for bad. Bitcoins is just more convenient for sending money to anywhere in the world, rather than just being local,” said Guy Paddock, Bitcoin consultant and CEO at Red Bottle Design.
Countries like China and India have suspended the use of Bitcoins after there was evidence it was being used for foul play. In recent months, the United States Government has taken steps to look into it and more action is expected in the future.
But until then this is legal, and Bitcoin experts say your money is safe.
Where else is this being used in our area? News10NBC was told Thursday there are local restaurants that you can use the Bitcoin system to pay your tab. But if you want to pay your babysitter or maybe even your electricity bill, you can't do that just yet. Advocates are hoping this system can grow to the point where you can. We will just have to see.