Bitcoin is taking root in St. Pete, but what in the blazes is it?

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The St. Petersburg Bowl is now the bitcoin St. Petersburg Bowl and business leaders in the area are hoping it could mean big things for the city.

More on that in a minute, but first, what the heck is BitPay?

Basically it’s a way to use online money called bitcoin. People can buy BitCoin and the funds are then available to make purchases with much in the same way you’d buy something online with a credit card.

The difference: There’s no identifying information for bad guys to use to steal identities and rack up fraudulent charges.

The catch is, much like it took time for merchants to begin accepting credit cards and not just cash, bitcoin is still relatively unheard of and not a lot of businesses accept it as currency.

Stephen Pair, the CEO and co-founder of BitPay, is hoping to change that. Not only is the service free, it also saves those businesses that choose to use it by not charging transaction fees the same way credit and debit card companies do.

Sounds pretty utopian right? Here’s how it works to save businesses money and keep consumers safe.

“With the credit card, when you pay online you have to give somebody that credit card number and if that credit card number falls into the wrong hands it also gives a thief the ability to pull money out of your account,” Pair said. “With bitcoin that process is inverted. You have software that digitally signs the transaction and sends the recipient the exact amount and they don’t have any information that could be used to pull money out of the account.”

The system works in a complicated web of security measures. There are cryptographic signatures. There are addresses unique to each customer that get routed and re-routed making them difficult to hack.

But that doesn’t mean it can’t happen.

“If there’s a virus that gets on your computer they can potentially steal that [address],” Pair said.

But BitPay can set up a system where more than one signature is needed, meaning a hacker would have to steal addresses from two different devices in order to get their hands on your bitcoin.

And as for the service being free, BitPay does manage to turn a profit. The company offers free services with limited access to help for small businesses. Other larger companies, or the little guys if they are so inclined, can opt to pay a monthly fee for upgrades.

In St. Pete, there are already a handful of businesses embracing this new techie money. The St. Pete Museum of History where BitPay leaders met with the St. Petersburg Chamber of Commerce is one. Ferg’s is now accepting bitcoin. There’s also Green Bench Brewery, Hotel Zamora and Center Plate.

That brings us back to the St. Petersburg Bowl. Mostly BitCoin’s sponsorship is a chance for companies like BitPay to attract new customers. But the St. Pete Chamber is looking at the new technology as a way to drive St. Pete’s economy.

Chris Steinocher, president and CEO of the St. Pete Chamber, compared BitCoin in St. Pete to early flights that left from the Burg when other cities were reluctant to jump on board.

“We want people to see St. Pete 100 years later as the city that embraced BitCoin,” Steinocher said.

The two groups are also hoping that BitCoin’s name on a college football bowl will attract viewers and even visitors from the Internet world who may not have been likely to pay much attention to football before.

The bitcoin St. Petersburg Bowl used to be sponsored by Beef O’Brady’s. The game is played the day after Christmas.

 

Janelle Irwin has been a professional journalist covering local news and politics in the Tampa Bay area since 2003. She also hosts a weekly political talk show on WMNF Community radio. Janelle formerly served as the sole staff reporter for WMNF News and previously covered news for Patch.com and various local neighborhood newsletters. Her work has been featured in the New York Daily News, Free Speech Radio News and Florida Public Radio and she's been interviewed by radio stations across the nation for her coverage of the 2012 Republican National Convention. Janelle is a diehard news junkie who isn't afraid to take on big names in local politics including Tampa Mayor Bob Buckhorn, the dirty business of trash and recycling in St. Pete and the ongoing Pier debacle. Her work as a reporter and radio host has earned her two WMNF awards including News Volunteer of the Year and Public Affairs Volunteer of the Year. Janelle is also the devoted mother to three brilliant and beautiful daughters who are a constant source of inspiration and occasional blogging fodder. To contact, email janelle@floridapolitics.com.