‘The decision got their attention’
Business incubator agrees to accept cryptocurrency for fees, payments
The New Haven-based business incubator and work sharing space, The District, has joined a small but growing group of businesses that accept cryptocurrency.
David Salinas, co-founder of The District, said he made the decision to begin accepting cryptocurrency for membership and commercial real estate leases because he believes in the technology. Since making the decision last week and marketing it on a nearby billboard, Salinas said The District has received several membership and tenancy inquiries each day.
“The people who have called say that the decision got their attention,” he said. “It shows we are a group of forward-thinking people. The District is built on innovation, so I believe it is important to be involved in this now.”
The District has about 95 percent of its space filled, according to Salinas.
Salinas said several of The District’s tenants are “involved in building blockchain products, mining crypto tokens for services and investing.” Blockchain is the technology that enables the existence of cryptocurrency, which is a financial medium of exchange.
Salinas said payments in Bitcoin will be made at the rate applicable on the payment time and date. Just before 3 p.m. on Monday, one bitcoin was worth $51,452.
“The market is ready for this, and it shows in the price,” he said.
But two New Haven area professors say cryptocurrency is still in its infancy and is extremely volatile.
David Sacco, practitioner-inresidence from the University of New Haven’s Pompea College of Business said “this stuff is so new that I’m not sure that it has become a generally accepted medium of exchange. A lot of companies are going to say they are using it because they think it attracts in investors; they perceive there is value of saying they are associated with it.”
“But there are certainly a lot of businesses, big and small, that are trying to latch on to it,” Sacco said.
Coinmap, a web site that follows the cryptocurrency business, has only about a half dozen locations in Connecticut that accept it as a form of currency, he said. Three of them are in Fairfield County.
Electric car maker Tesla has invested heavily in bitcoin and made $1.1 billion on its investment in about a month. The company has also announced it will accept the cryptocurrency to pay for the purchase of its vehicles.
Osman Kilic, a professor of finance at Quinnipiac University, said institutional investors — the “big money managers” — are investing billions in cryptocurrency.
“There goal is to protect against inflation that is expected to arrive,” Kilic said.
Kilic agreed that even with companies like Tesla investing in cryptocurrency, “this trend is still in its infancy, still in the crawling stages.”
“It’s going to take quite a bit of time to mature,” he said. “It is not stable right now, and it’s difficult to value because it’s pure speculation, but there’s no question that it is here to stay.”
Salinas said he’s not dissuaded by the volatility of cryptocurrency.
“Over the years I’ve learned to never let the fear of change get in the way of progress,” he said.
How quickly cryptocurrency matures and becomes more widespread depends upon how regulators decide to treat it, according to Kilic.
“The adoption of it will go up considerably when a regulator like the (U.S. Securities and Exchange Commission) decides what they want to do with it,” he said. “Right now, regulatory agencies are doing nothing. They are just watching it.”
In order to dabble in cryptocurrency, consumers need to set up a brokerage account with a company that trade in it and create a digital wallet, according to Kilic.
Salinas estimated more than 100 people connected with companies that are part of the district have some form of cryptocurrency.