The Smartphone As A Wallet

Last night the Gotham Gal and I went out with a bunch of friends. We met at a restaurant on the upper east side that had recently opened. It was snowing pretty heavily all day yesterday and we were worried about getting a cab on the street. So as we were getting ready to leave, I hailed a cab on my smartphone so that it would pull up in front of our apartment building. The car came more quickly than I thought it would and we scrambled out of the apartment and got in the car and headed uptown.

When we arrived at the restaurant, I realized that I had left my wallet in the apartment. Because the cab was paid for on my phone, the driver had been paid and tipped. But I was concerned about paying for dinner. So I told the Gotham Gal that she would have to pay for dinner. And then she told me that she too had walked out without her wallet.

Fortunately we were having dinner with friends and I asked one of them to pay for our share of the dinner, which he was happy to do. When the check came, I asked him how much our share was, he told me, and I pulled out my phone, opened my Coinbase app, and sent him a fraction of a Bitcoin to cover our part.

I then hailed a cab to get us back home and when we walked out of the restaurant the car was out front waiting for us. We got in, went home, and walked the dog and went to bed.

We paid for every part of the evening on my smartphone. Had we been going out solo last night the Bitcoin bit would not likely have been possible. But my gut says that will change pretty quickly. We are not the only people getting used to paying for things on our phone and doing it frequently. The experience we had last night seems likely to be normal and customary in a few years time. And I can say that it is a convenient and pleasant and I am excited to see it coming.

#hacking finance

Comments (Archived):

  1. William Mougayar

    Could you not have paid the restaurant the same way, i.e. send them the bitcoin fraction?I’m assuming if the recipient isn’t on Coinbase or some wallet, they get the email which lets them create the account and receive the money, no?

    1. Billy Polcha

      Chase Bank has Patented(IP) an Internet Protocol Payment Network & their IP dates back to 1999. Mentioned in Chase’s IP is Western Union & “micro payments.” The masees will gravitate towards a well known & long established bank like Chase.

      1. William Mougayar

        You already said that.Is there a Chase digital wallet available?

        1. Dale Allyn

          Chase has “Chase QuickPay”. I experimented with it a few times, first with my daughter, then a friend. I love Chase’s banking website (compared to other banks). If has powerful features and works rather well. But their QuickPay service was anything but “frictionless”. Square is teaching how quick payments should be made, at least for those willing to at least provide a bit of signup effort. Chase QuickPay was slower than Paypal, taking about 4 days for the recipient to receive the funds. I suspect they’ve made improvements since I tried it, but if the banks can’t embrace a low-friction, yet secure, process, Square and others will win this match.

        2. Billy Polcha

          Obviously Chase has yet to offer their Internet Protocol Payment Network & Digital Wallet to consumers & merchants. But Chase has been granted IP for a Digital Wallet. Intellectual Property is public knowledge in the USA.

          1. Sollars&Sense

            Billy we are curious… Have you gauged the Public’s perceptions and opinions of banks?It just seems as if you really believe Chase will actually stand a chance in a Free Banking system. With their legacy business model do you truly believe that’s possible?

    2. LE

      Assume they aren’t going to learn about bitcoin and coinbase on the spot and agree to that.What Fred could have done (if his friend wasn’t there with his card) is just called JLM and he could have faxed his credit card to the restaurant and covered the charge.

  2. Dave Pinsen

    Why should you even need a smart phone? Why not some merchant device with a biometric identifier like a finger print reader which uses your biometric data the way a credit card terminal uses the magnetic strip on your credit card?

    1. Rohan

      Exactly right. Or perhaps we would just have a chip embedded that we’d tap like oyster cards in London/ NETS in Singapore.

  3. Richard

    I’ve been there, solution …. breakfast at Starbucks, lunch at Sweetgreen. what a competitive advantage, can’t understand why more retail isn’t doing this?

  4. William Mougayar

    This shows how stupid the banks and credit card companies are, to not have a digital wallet app already today, which accepts money, credit cards, bitcoins, foreign currency, all in one, mashed up together, and with peer to peer transactions. I can already email someone money via my bank account, but it takes a few steps.Banks and credit card companies still have our mindshare, but in the meantime, a wallet like Coinbase will eat away at their market share, gradually.

    1. Elia Freedman

      Where to start? They let PayPal in their house. How about the fixed portion of the transaction fees? How about the way they treat electronic transfers as if they are valuable. Explain to me why Wall Street CEOs get paid so much? It sure isn’t to advance society.I’ve been doing some volunteer work for my daughter’s school. One of the programs is called Scrip where you can buy gift cards to local merchants and a portion of the proceeds goes to the school (3-4%). It’s a nice program but everything is done with checks as credit cards would eat most the proceeds. I can’t find a way around this.

      1. William Mougayar

        Agreed. Paypal is transaction fees thief. I recently organized an event on EventBrite. The combination of their fees with PayPal’s was close to 8% of gross.

        1. awaldstein

          I can’t think of anything good or any reason to use PayPal.i bristle and often just won’t participate if they are the only option.

          1. pointsnfigures

            they make it super efficient and easy to pay-but I agree with your sentiments on high fees. one of the reasons they can charge high fees is lack of a viable competitor, and ubiquitous placement in market

          2. awaldstein

            Every try to resolve a dispute through them?

          3. pointsnfigures

            No, haven’t. I don’t imagine that it would be “fun”….

          4. Chris Mottes

            Unfortunately Paypal is still the best and cheapest solution for e-commerce for a small company – at least outside the US.

          5. awaldstein

            Thanks for the input.For a merchant network I built on Stripe and a niche food company on Shopify, for neither did I implement Paypal and am getting along fine.I’ll probably implement Bitcoins next actually.

          6. Chris Mottes

            Unless things have changed recently neither of those would allow me to operate from outside the US more efficiently unfortunately…but ai will check. Bitcoin…hmmm…I have enough trouble protecting my income from the volatility of the USD, the way Bitcoin’s value swings it seems like a large risk to take on a small business.

          7. awaldstein

            Agree–Bitcoin is a novelty by any stretch and not core.To my understanding, CoinBase allows the transaction to move to dollars on exchange if desired so it can play in the payment process without risk.My interest there is to get closer to it and since these two businesses are in NY, and many clients are tech connected, a way to create some community dialog.I’ll ask buddies in Europe what they use for their businesses. Know a number of artisan and am becoming closer with a festival that cross a lot of borders there.

        2. jason wright

          i’ve had similar too. i’m wrapping up some ebay sales to clear out space at home and then i’m finished with PP.

    2. Matt A. Myers

      Coinbase/Bitcoin and banks are apples and oranges though. Banks have heavy governance from governments – regulations, rules, etc.. That requires policy to change first before the physical structures and systems can follow.

      1. William Mougayar

        Too bad for them.

        1. Matt A. Myers

          Right, though not sure it’s fair to say they’re the stupid ones, is all. It’s quite a holistic problem, primarily driven and perpetuated by the for-profit capitalistic system.

      2. ShanaC

        And I’m ok with that

      3. Sollars&Sense

        Good point Matt! We try to explain that to others too. BitCoin will most likely not be disrupted by any established banking institution. Its simply not feasible for them. Rather what BitCoin must look out for is an Apple to Apples platform that makes more $ense for a larger number of people… You know. Like a BitCoin for the rest of us. That is what we believe 2014 will be about. #LetTheBattleBegin

    3. Billy Polcha

      Chase Bank has Patented (IP) an Internet Protocol Payment Network, Chase’s IP dates back to 1999. Western Union & “micro payments” are mentioned in Chase’s IP. Most likely, the maases will gravitate towards an established bank like Chase.

      1. Sollars&Sense

        Or they could gravitate to an independent Firm with its own currency that Makes more $ense for them than Chase or BitCoin.BitCoin is not the only way. Chase won’t be the only option. The race has just begun (said the tortoise).

    4. Magnus Kromann

      In Denmark an app called MobilePay is rapidly gaining ground among smartphone users. It allows the user to send money to any other MobilePay user. The signup process is very simple and takes a few minutes, which makes it easy to persuade friends and relatives to install the app. The app itself is well executed and it just takes few seconds to send money to any person, as long as you have their mobile number.I believe that the reason it’s so successful is that anyone with a Danish bank account and a Danish mobile number can sign up, so customers of competing banks can also use the app. The second thing is that there’s absolutely no fees but rumours says it will be introduced for users which is not a customer in Danske Bank – I hope not.What’s interesting is that a large amount of shops are starting to accept MobilePay as a payment option. Danske Bank encourages this and has started to hand out signs, which states that this shop accepts MobilePay. Personally I recently paid for a bag of almonds with the service, and I was surprised how easily it worked.Obviously it doesn’t have the amount of features you mention but it’s a start and I am hoping it will developed further – as succesful as it is it seems feasible in my opinion.

      1. William Mougayar

        That’s a very interesting initiative. Thanks for explaining it!

    5. sigmaalgebra

      Yes, you are correct. As I posted to this threada few minutes ago, I see a lot of grim problemsespecially with security, with smart phones.But if smart phones really work, then creditcard companies, banks, and more are at risk.Apparently they believe that they have a caseof ‘the innovator’s dilemma’. They better getpast their dilemma, that is, take the lead inmaking smart phones work or find themselves out of a lot of their business as others slowlymake smart phones work well for money.

  5. pointsnfigures

    Eventually, you will be able to pay the restaurant with an app like You could have also paid your friend in US dollars with Venmo. Many years ago, someone postulated a cashless society. It will come true. I rarely carry much cash anymore living in a city. I am cognizant that city life is a lot different than suburban or rural life though. Things happen faster in cities because of density.

    1. awaldstein

      There is nothing I do on a weekly basis that requires cash other than some vendors at the green market and maybe house cleaner.What else?But the leap to a cardless reality is something else entirely.

      1. Elia Freedman

        And if you ever worry about the government knowing everything… Get rid of cash, too.

        1. awaldstein

          The last bastion of cash is the green markets. Actually only a tiny fraction use Square.And more and more of my shopping happens there.Accountless holdout.

          1. LE

            Cash business tax avoidance strategy in many cases.

      2. pointsnfigures

        Yes, farmer’s markets are where I spend most of my cash.

    2. fredwilson

      venmo is really taking off among my daughters’ friends. they use it frequently

      1. Andrew

        Venmo is the de facto standard in mobile peer to peer payments for those in their 20s. Overall the last several months it has gone from “Oh, do you know about Venmo?” to “Do you have Venmo?” and now it is “I’ll just Venmo you”

        1. fredwilson

          that’s called “winning”

          1. Andrew

            Accepting payments in your app via Venmo Touch will allow people to associate the interface with an app they already use with their friends. $EBAY

        2. ShanaC

          I wonder why that happened after they got bought out though.

          1. Andrew

            Started happening before…most users know nothing about the acquisition.

          2. ShanaC

            Are you the andrew from Venmo?

          3. Andrew

            If only I were

        3. sprugman

          Why venmo over dwolla? Just curious…

      2. pointsnfigures

        Mine as well. They use it a lot. We use to to transfer money around the family.

      3. Cliff

        Just curious, do your daughter or her friends mind the “Social network” feel of Venmo? By default every transaction is shared publicly and unfiltered (for instance, Venmo’s home page frequently displays memos that say “for drugs”) … surely that will scare off anyone who expects their financial life to remain private (and not have to opt-out of sharing).

    3. William Mougayar

      I’m surprised it’s not yet available in Canada. C’mon.

      1. pointsnfigures

        Canadians still use fur and barter don’t they?

        1. William Mougayar

          Tim Hortons rules here. They just introduced smartphone payments this week. Actually, it’s a roll-up of the Tim Card into a smartphone app.But long term, that’s crazy to need an App for each merchant. We need a truly universal digital wallet where you don’t need to worry about compatibilities.

          1. pointsnfigures

            My friend that started Braintree said he thought digital wallets were not the way to go (at least the way they were currently thinking about them). He said, “do you have a problem whipping out your credit card?”. Braintree had just bought Venmo. Peer to peer payment looks like the way to transfer money-a big network.

          2. pointsnfigures

            do they use donuts for barter? If so I am transferring citizenship. (just kidding)

          3. William Mougayar

            I’ll trade you a Krispy Kreme donut for Tim Hortons’.

          4. pointsnfigures

            Sold to you and I got the better deal! (not a Krispy Kreme fan)

          5. JamesHRH

            Mostly moose hide & beaver pelts.

  6. ariannasimpson

    @fredwilson:disqus You can also pay with Cover at an increasing number of restaurants in the city.

    1. fredwilson

      yup, watching that one closely

      1. ariannasimpson

        The same wallet issue happened to me this past week. I ended up Ubering home and Venmoing my friend $ for dinner. I still think it’s preposterous that in today’s day and age I still need to have a wallet with me for any reason…hope USV funds more co.s solving this in various ways.

    2. Richard

      Payment platform LEVELUP is good as well .

    3. ShanaC

      what is cover?

  7. Shanif Dhanani

    There’s no doubt that a cashless society is on its way. For those of us that live in NYC that may take a bit longer :)I am curious about the Bitcoin part. I’ve noticed you’ve gotten much more heavily into that as of late. Did your friend have any issues/concerns about receiving a Bitcoin payment? Were PayPal or Venmo even a consideration or did they not come to mind?Just very curious to hear how Bitcoin is being adopted organically among non-techies.

    1. fredwilson

      my friend has a coinbase account so he was happy to take bitcoin from me

      1. awaldstein

        just signed up for one.

      2. William Mougayar

        What if he didn’t. Could coinbsase have held it til he signed up, and that would be their first deposit?

        1. fredwilson

          yup, that’s how most of the bitcoin i’ve given to friends has workedi was at dinner with two friends last nighti sent each of them one bitcoin a year agothey had completely forgotten about itthey now have $1700 they didn’t realize they had

          1. William Mougayar

            Good viral hook. bonus for the increase in value.

          2. pointsnfigures

            Yes, but what if it was worth $17?

          3. JamesHRH

            You are a cool friend to have, clearly.

  8. Jeff Jarvis

    And by the time your friend got home, the value of Bitcoin fell/rose and he lost/doubled the value of the dinner….But seriously…. I was surprised when I went into Macy’s for the first time in probably a decade and saw that I can use my Google Wallet and NFC to pay bills. I do believe that’s where payment with mobile devices heads.

    1. michaelbrom

      I just got my physical Google wallet card in the mail.. Don’t really know why/what to use it for yet..

      1. Timothy Meade

        I’m currently using mine to budget fast food purchases, charge it at the beginning of the week and use it exclusively.

    2. fredwilson

      when merchants take payment with Bitcoin using the coinbase merchant product, they can opt for instant execution of buy/sell so they don’t take that riskthe same thing could easily be offered on p2p btc transactions between coinbase users

      1. Richard

        And it (potentially) makes FX transaction costs a thing of the past

      2. Phil Swenson

        Good point Fred. But for bitcoin to be viable, it needs to be stable for people like yourself who use it as a currency. Why would anyone want to hold a currency that is so unstable?Bitcoin has to have some sort of advantage over the dollar (or any other currency). I really can’t think of any advantages of using bc other than it’s untraceable (great for illicit use). Are there advantages I’m not thinking of?You could have easily have sent your friend money via Square as well. And it seems more likely that a restaurant would take money via some sort of dollar based internet system (Square again comes to mind).

        1. fredwilson

          that would have involved transaction feesbecause bitcoin is internet native money, it can move across the net without feesand it will stabilizewe are in the early days

          1. Bernard Desarnauts

            Cash by Square doesn’t have any transaction or other fees

          2. fredwilson

            Requires a debit card. That suggests there are debit card fees involved

          3. LE

            As a merchant one of the big advantages it seems to something like Dwolla or Coinbase instant settlement is that (from what I understand) there are no “do overs”.That’s huge. Nothing is more annoying than having to deal with a chargeback. Legit or not.We had a customer that didn’t recognize a charge and the bank backed it out on their request.After we wrote to them back and forth (like 3 times) they apologized and gave us a new credit card but said their bank said they can’t reverse the reversal.So we get hit with a penalty and a black mark. Not only that but they are in China. So you have that whole broken english thing going on. The time spent on this (including sending paperwork to support the transaction) is a big deal for merchants.Having a transaction be final and shifting the power to the merchant is a big deal and saves money (in addition to fees of course).

          4. awaldstein

            Having all transactions final and giving all the power to the merchant is of course a recipe for consumer failure.

          5. LE

            Don’t agree.We are not talking the 1940’s here and fly by night by and large.A consumer has avenues (especially with the internet, comments, ratings, blog posts etc.) to rant about a merchant that is unfair in their practices. (Takes effort but is possible.)Otoh a merchant can’t do anything practical when a consumer simply decides to dispute a transaction which they can do on any number of levels. No forum to say “hey watch out for this guy who games the system or makes things up”. No way to keep track of people who know how the system works.The credit card processors hold merchants (not talking about Walmart or a large vendor here) to a very high standard. Essentially if the consumer complains “boo” you lose the money without a monumental effort to provide backup for the transaction. Which assumes you have it. Could be lack of a sig or could be quality of product or any number of things you get stuck with. Go take the time to fight it if you want.Additionally you know each and every day many merchants get charges that are fraud and we have to weed them out (or pay for a service to do so) and if a card is used fraudulently even though it’s been “approved” it will cost not only the money charged back but also the “vig” which is say $25 to $35 dollars. And paperwork. Like if a kid use the parents credit card and say “they didn’t have authorization” you are SOL (had that happen). Go try to take the time to make sure each transaction is ritually correct and legit. You can’t. (At least not for small type transactions larger ones pays to do so).By the way you as a consumer are paying more (in theory) because of the credit card “vig” which is not only the % that is charged a merchant but also the cost of doing business by credit cards. Which was pretty much essential before the internet.Attached just a small portion of fraud caught and prevented manually. These were easy.

          6. awaldstein

            More than one way to slice anything.Merchants who think of the world through through their point of view rather than the customers, invariably loose.

          7. LE

            Attached is a transaction where the customer agrees with us and said they made a mistake and shouldn’t have disputed. But they say they can’t reverse – that we should just charge the card again. And this was after 6 emails back and forth. (from China).Had they not had such an easy route to dispute they would have simply written to us with a question not shot first.

          8. awaldstein

            There’s always corner cases.I always build my businesses on the norms not the exceptions.

          9. LE

            I am well aware of how to treat customers. There was a saying in my first business which applies and takes many different shapes and forms.It is “price quality speed” pick any two. (Also customer contact of course but that was not part of the saying..)In my first business we were actually high priced and the quality was just “ok”. And this was in a business where quality and price did matter.But the most important thing we had going was to be on the ball and not make the customer think. If you called us with a project you got what you wanted and didn’t have to worry about the details. Lots of hand holding. Nor did your secretary either. We returned calls we go you the quote on time we answered questions. And we were really happy when you called as well. People liked that. Rush? No problem. Done overnight? No problem.The “company up the street” did the same thing had way better quality and way cheaper prices. But they didn’t know how to treat the admin assistants and not waste the time of an attorney or insurance company or ad agency. They were pains in the asses. So we got the order. They laughed when we opened because they were so good at what they did. And so much cheaper and better. (And I had zero experience in the business I might add and learned it from scratch.) That company is no longer around (long long gone) as are many others but the one I started (out of school) and sold in 1990 is still around today.

          10. John Revay

            How does Coin base make money?

          11. fredwilson

            1% on buy/sells with merchants getting the first million for free

          12. Andrew Kennedy

            This is really interesting

          13. ShanaC

            so how is that different than any other form of moving money?

          14. Bernard Desarnauts

            I have been using it for several weeks over 10+ transactions and thus far no fees – now maybe it’s specific to my checking account?

          15. panterosa,

            bummer. I really liked the Square Cash idea.

          16. Scott Barnett

            I don’t think that’s right Fred. I’ve used Square Cash a few times, have not had any transaction fees.

          17. Jason McMinn

            Square Cash has no transaction fees . . . at the moment.

          18. Vinay Pai

            Taking payment in a currency that frequently has 50% swings from day to day to save on 2.5% in fees seems penny wise pound foolish to me.

          19. Kenneth Luna

            “instant execution” is a function of liquidity in the Bitcoin for USD swap market right?I’d find it troubling if a handful of merchants tried to instantly swap bitcoin for USD and there weren’t enough market makers to service those bitcoin offers. The USD/bitcoin rate would increase, leaving merchants with bitcoins worse off. That is no bueno.I hope Coinbase and other stakeholders are spending time and resources recruiting third party market makers to service these currency swaps.Oh and don’t forget your wallet next time! 🙂

          20. Scott Barnett

            Square Cash would not invoke transaction fees

          21. ShanaC

            I don’t see how that is possible. How will the people moving the bitcoins make money (and not more bitcoins, I mean a profit)

          22. Jacob Rideout

            The fee is hidden in the exchange rate spread they offer vs. the market price they receive. They only take on as much currency risk as inventory they hold to limit transaction time. Coinbase in particular has said they resell most the bitcoin they purchase. So when then sell/buy transaction volume are roughly equal, the profit is made entirely on the spread. Otherwise they take a percentage over the best rate they can get from their liquidity providers.

          23. Austin Clements

            Why not just use a payment system that doesn’t have transaction fees?

        2. ShanaC

          Ding!I rather pay transaction fees and know what I am paying.

        3. Sollars&Sense

          Excellent, Excellent, EXCELLENT points Phil! What will beat the dollar system is something that works like it, just smarter… The American people will not adopt BitCoin in mass. Its too complicated. There is a much better way.What Fred and other early investors fail to realize is the double edge sword of “being in the early days” We believe they say that as if BitCoin has already been decided as the winner.It is like the race between the Tortoise and the Hare. They’ve chosen the Hare (BitCoin) and are about to miss the Tortoise when it takes over… 2014 is when The AltCoin for everyone else will appear #LetsMake$ense

      3. LE

        with Bitcoin using the coinbase merchant product, they can opt for instant execution of buy/sell so they don’t take that riskHoly crap. Why didn’t you tell me that she was pretty, had an IVY college degree, and came from a family with a summer home???How would anybody know that when looking at the home page?That changes everything. Needs to be incorporated into the marketing messages.

    3. Jim Peterson

      That was my thought. The friend who took payment might make double or lose half by the next day. Makes it interesting and adds a gaming element!

    4. Richard

      Yep, when your in a single digit earnings business (restaurant), currency volatility of even 3 % makes bitcoin an issue.

    5. Jordan Thaeler

      Google has spent $300M+ on Google wallet and consumer penetration has been trivial. I think consumers shy away because 1) It’s not a real pain point, and 2) CCs have tons of security measures in place. Is paying with piece of plastic exponentially more cumbersome than paying with your phone, which has limited battery life and you can misplace as frequently as your wallet? I think not. I believe the premise of this conversation is incredibly symptomatic of excess liquidity flowing to VCs. Fed’s pumping money, tons of capital seeking higher-than-S&P returns, so VCs are letting startups invent problems so they can go to their LPs and demonstrate value. I’m totally in bed with Thiel here: there have been hardly any tech inventions lately that move society foreward.

      1. Timothy Meade

        I ordered the Google Wallet Card a few weeks ago after leaving my card at a restaurant, you can do it right from the app and it’s free and instant (you just confirm your address and the ship it.) I wish Google would allow me to upgrade to an NFC card for a few bucks.Unfortunately you can’t just fund directly from a bank account, but it’s quick enough to fund on the Wallet app. I would also like to see a use case with different wallet buckets for different types of businesses, letting me set and keep a budget enforced by the card not allowing a transaction once that bucket is used.Of course this doesn’t help with the leaving the wallet somewhere use case.

    6. ShanaC

      Batteries are still a huge problem.

    7. Sollars&Sense

      Great point Jeff. It’s funny how people believe a race (digital currencies) that has literally just begun is already over… Choose wisely, said the tortoise. #LetsMake$ense

  9. LIAD

    Watching the Big Dog video from Boston Dynamics which Google purchased this week fried my brain hard drive. The future is getting real. At warp speed.Use phone to order self-driving car (effectively a robot).Eat 3D printed food in 3D printer built restaurant. Pay for it all using cryptographic money you minted yourself on your computer

    1. Sollars&Sense

      In terms of that last point how many people do you believe is actually in that demographic?Further more as BitCoins get scarcer do you believe that demographic will get larger?

      1. Jacob Rideout

        The time has already passed. Profitable mining requires the use of single purpose ASIC hardware, you can’t do on your home computer for cheaper than the cost of electricity required to run the thing. On the other hand, as mining new coins becomes a rarer event, transaction fees will start to make up the gap.

  10. mdudas

    So many great options for this type of evening in NYC. You could have used Cover or Dash for dinner & drinks; Uber, Way2Ride or Hailo for your cab/car; Venmo or Coinbase to split the bill with your party.

    1. fredwilson


      1. Robert Holtz

        I have total confidence in the future of virtual currency and stored value in an app-based future versus physical plastic cards carried in a folding animal’s skin.Funny enough, I had a somewhat similar experience just earlier tonight. I’d gone out with a group of friends and we left our restaurant and wandered into a nearby Starbucks.I have a stored value account with them that works with Passbook. Starbucks has an optical reader with a long coiled cord that sits in a cradle next to the cash register. Rather than wait for the cashier to lift the reader out of the cradle and have to point it at your phone, if you’re a regular you quickly learn that you can simply wave your phone in front of the reader without it ever being removed from the cradle. It is a time saver for both the cashier and the consumer. I love this and storing prepaid funds in my account is justified in my mind for this speedy convenience.Well tonight, my good friend tried to pick up the tab for the group’s drink but the cashier refused his money. He thought the cashier was comping the drinks and was stunned she was doing that. She clarified, pointing to me, saying “He paid in full a few minutes ago.” “When?”, my friend protested. He said he was looking at me the whole time waiting for the order to be completed and I had yet to reach for my wallet. “Wallet?” me and the Starbucks gal said in unison, like my friend was talking of some far off relic.There is no question in my mind that this will happen. Just like I don’t see physical shrink-wrapped software coming back now that operating systems and mobile apps and even desktop applications are all available as the transfer of bits… once people start to get used to paying this way, it will feel just as official as swiping a mag strip but significantly less cumbersome.Full disclosure, I sit on the board of a company involved in virtual currency. But that doesn’t bias me. I have no hidden agenda. Quite the opposite, it proves empirically that truly believe in the “virtual payments” future. To me, it isn’t a question of IF. Soon it won’t even be a question of WHEN because it is already starting (ergo your night without your wallet and my slight-of-hand Starbucks purchase). The tech is there just not widely propagated but that is a matter of pure execution. The tipping point will happen when consumers embrace it because ultimately it is easier and it provides a superior experience.

    2. Sollars&Sense

      But we also need more players in the digital currency payment space. Its so brand new!The reemergence of a Free Banking system entirely run on the Internet is an excellent start… But in order for digital currencies to really have a great impact there have to be more of them with different philosophies and benefits for end users.We hope this make $ense.Competition spurs innovation. BitCoin must not be the only digital way… It’s fatal flaws (volitility, marketability and anonymity) for mass adoption must be improved upon by others. Then let the People decide… #Makes$ense

  11. PhilipSugar

    This is another one that I will ridicule, and that will just prove the point that I am wrong on it.I remember about five years ago you had a similar post, and I was explaining the value of a Franklin. I still believe the the value of a Franklin, but think it will become a bit retro which will be fine.

  12. ErikSchwartz

    I like paying with my phone, I use levelup and some others, but when things go bad in my experience (ie forgot cash/cards/etc) my smartphone battery is inevitably dead too.

  13. howardlindzon

    Interested to see if he lets that bitcoin fraction ride…. 🙂

  14. matt restivo

    Speaking of just walking out… check out the Cover app. It eliminates the friction of waiting for the bill in restaurants.

  15. ivanhoff

    You could’ve paid your friend via gmail/GoogleWallet or paid the restaurant directly with your GoogleWallet app if they accept contactless payments. We don’t need Bitcoin to pay with our smartphones. In 2014, we will see a lot more people using their smartphones to pay for everything.

  16. LE

    and I pulled out my phone, opened my Coinbase app, and sent him a fraction of a Bitcoin to cover our part.When I was growing up I used to hear stories from my father (or may have been my uncle) about how people in Israel would pay for their dinner when they arrived because the inflation was so high the price would go up by the end of the meal.While that’s probably an urban legend I just check historical inflation in Israel and if it’s true there are times when in one or two years inflation was 345%.…(I don’t know if accurate only place I checked..)

    1. awaldstein

      Ageless Borscht Belt joke.

      1. LE

        “My doctor told me I have 6 months to live. I told him I couldn’t pay the bill so he gave me another 6 months..”

  17. Davealevine

    Challenge with Bitcoin as opposed to Cover, Square, Paypal, (and soon Apple), is the point of sale infrastructure is already in place to allow these players to link up to credit card systems and it’s credit underwriting and management. Just don’t see how Bitcoin gets up this adoption curve fast enough and even if they do, without integrating with Credit it will miss out on a big benefit of our current payment systems for lots of people.Agree though that frictionless payment systems attached to and managed by our smartphones is where things will be soon.

    1. pointsnfigures

      Bitcoin is more versatile, because it can do cross border payments without fees. A homing pigeon for cash.

    2. Drew Meyers

      does a debit card exist that connects directly to bitcoin (via coinbase?)

    3. Sollars&Sense

      Wonderful points Davealevine. The problem with this assessment though is that it assumes two things which are most certainly false1.) The dollar and other paper currencies will stay sound forever (not gonna happen)2.) BitCoin is the only digital currency with a plan in this space. I would encourage you to check out other AltCoins and platforms. There are a lot of interesting things being created.It’s just the beginning. The next three years are going to be interesting…

  18. LE

    I use the Starbucks mobile app to pay everyday and it’s great. I love not having to pull the Starbucks card which was an improvement over cash.Efficiency wise it almost doesn’t get any faster than that.The opposite are women paying with cash who inevitably (because they have a purse) fumble for coins and hold up the line.

    1. Matt Zagaja

      The first time I paid for Starbucks with the mobile app my mind was blown. I wish merchants would adopt things like that and Square but I can see how the market is too fragmented at the moment for them to bother.If you think fishing for coins is bad, try getting stuck behind someone writing a personal check at the grocery store.

      1. Andrew Kennedy

        Could just be a clearly labeled express lane.

    2. JamesHRH

      I find that the Seinfeld ‘women with check books’ ti be true – some can pay faster with a check that with cash!I recently updated my phone and the iOS beamed my Sbux app to space. Weird, as it was prominent on my first screen.

  19. LE

    “And then she told me that she too had walked out without her wallet.”You kind of have to go out with your wallet though it has health insurance information as well as license and other identification. [1] For all you know there could be some event that happens and streets are blocked off and you need ID to get back in your neighborhood or to pay someone to help you (I’m not kidding btw) out of the city. Even a gypsy cab in an emergency.[1] You could take pictures of anything important but then if you did that info would be on your phone. I’m guessing there is probably an easy way to store that on your phone encrypted (by easy I mean someone has made an app to do that specifically for that purpose).

    1. Dale Allyn

      This is what I was thinking. I know @fredwilson:disqus stated that his wallet was left unintentionally, but your points are consistent with my “policy”.I always carry cash, some is tucked (discretely) in my wallet, the rest is in one or both front pockets. I always have enough to arrange some sort of assistance if needed because many emergency situations are not going to be interested in credit cards or smartphone payments, etc.Fred’s situation is illustrative for the theme of his post, but what if he had neglected to charge his phone sufficiently and battery was dead by the end of dinner? 😉

      1. LE

        Exactly.And the corollary to that is why young people can travel with only a backpack and nothing else for months. Because they haven’t hit enough situations statistically where the lack of packing something important caused a real problem. Wow no extra contact lenses? Shit I can’t see!

        1. Dale Allyn

          Ha, on the contact lens issue: I have a scan of my Rx which I’ve uploaded to two locations: my server and a Google Doc. I can order lenses in Bangkok, HK, Singapore, Hanoi, Burundi…;)

        2. Drew Meyers

          “young people can travel with only a backpack and nothing else for months”the best way to travel 😉

    2. Kenneth Luna

      agreed. the idea of concentrating my identification and money onto my phone makes me a bit nervous. If you forget your wallet at home, you are probably just as likely to forget your phone in a cab or at the office.I see the value in having your phone complement good old hard ID and cash but I don’t see it as a pure replacement.

    3. ShanaC

      my phone actually is automatically encripted. Thank you Moto X

  20. William Mougayar

    Fred, Did it cross your mind to ask the waiter or restaurant manager point blank if you could pay your bill portion with Bitcoin? Maybe they would have let you email them the money.

    1. fredwilson

      No it did not

      1. William Mougayar

        Not me.

  21. Barry Nolan

    Ev Williams captured your frictionless experience beautifully in a wired article.“The internet makes human desires more easily attainable. In other words, it offers convenience,” he said. “Convenience on the internet is basically achieved by two things: speed, and cognitive ease.”“We often think of the internet enables you to do new things,” Williams said. “But people just want to do the same things they’ve always done.”“Here’s the formula if you want to build a billion-dollar internet company,” he said. “Take a human desire, preferably one that has been around for a really long time…Identify that desire and use modern technology to take out steps.”His recent example is Uber. “How old is the desire of getting from here to there?” he said. “How hard was it really to do? They took out some steps in that process…They formed a connection between you and the driver.”…

  22. Derek Webster

    Note that the friend who actually paid the restaurant for the meal still used a ‘legacy’ method. Presumably a physical credit card or maybe cash.While I agree that the convenience factor is awesome from a consumer standpoint, and genuinely hope that experiences like yours become possible more often and soon, I’m skeptical that any total market shift is going to happen “in a few years time”.Credit card networks have been around for ~55 years and only became truly ubiquitous in the past 5 or 10 (to the point where now as a consumer you rightfully expect/demand that a merchant accept your Visa card as payment.)We’re still a long way away from a situation where you can safely leave your wallet (and traditional cash/cards behind) and reasonably expect most/all merchants to accept a wallet method. Aside from vertical specific applications (e.g. transportation) there isn’t a sufficient incentive for most ‘normal’ brick and mortar merchants to adopt one or more mobile wallet platforms and train their front line employees on it. The fragmentation on the consumer side (normal consumers barely want to sign up for one wallet, let alone 20) doesn’t help that side of the marketplace.

  23. jason

    Check out That platform moves money over ACH (no fees) and is available to 70% of US households because of the banks behind it. Big banks are definitely slow, but they can win if they want to. As for bitcoin, I don’t know if not makes sense to link the currency to the transaction when thinking about mobile payments. I understand the “native internet money” argument but I don’t think if that’s where the friction is for mobile wallets.

  24. getsuperfly

    Splitting a restaurant bill and paying for a cab are two of the most overused use cases for mobile payments. I had both in the PayPal Mobile presentation before our launch in 2006 🙂 It took a few years for PayPal Mobile to become the success story it is today but it had nothing to do with these use cases. The catalyst was consumers desire to buy stuff on eBay and their desire to do so on their phone. Innovation in payments needs a mule, eBay is a great mule, so is Uber. I’m curious to see who be the mule for dining….

  25. jason wright

    wallet or smartphone, money or bitcoin, now or in a few years time, forgetfulness will always be with us.the answer has to be home alarms and front doors that arm and lock with a smartphone. just don’t then lose it when you’re out on the town.

    1. Sollars&Sense


  26. paramendra


  27. FlavioGomes

    Ive been in simillar pickles and have done email cash transfers from my smart phone. Canadian banks support this. Not sure in the states. Small fee and and its near real time.

  28. Greg Kedzierski

    In Europe you would use PayPass card linked to your smartphone via NFC. Most merchants already have compatible terminals here.

  29. Kirsten Lambertsen

    I remember back in the late ’90’s when I was working at, we actually tried to work on handheld device enabled payments. I remember explaining to people, “Imagine just beaming a payment to a soda machine to get a drink, or beaming a payment to someone running a yard sale!” But back then, the banks made it seemingly impossible.It’s exciting to see it all becoming a reality… at last! This is definitely one of those things that feels like it always should have been there.

  30. Felipe Salum

    Hi Fred.What do you think if in this case the restaurant would charge you using biometric face recognition integrated with your bitcoin wallet or paypal account or even credit card company ?In this case you wouldn’t even need your iphone (worst case scenario), just your face.Let me know if you are interested about a new hot startup using this technology for payments.

    1. Sollars&Sense

      This technology actually makes $ense as an additional security protocol layer for transactions to be secure…Watch out, as long as this tech is not opened source you just might get acquired for lotsa money one day. Good luck!

  31. E.A

    Keith Rabois from khosla ventures and one of worlds most knowledgeable vcs in the payment space is very bearish on BTC. He says that government almost certainly will ban all marketing on BTC and refers to days of paypal/yahoo as well as all his other experiences in this space. Must be a bit alarming coming from a name like him ?! Any comments Fred? link to the interview:

    1. fredwilson

      he’s been very negative on foursquare too. i guess he likes publicly dissing other people’s investments. i don’t do that.

      1. E.A

        Sure but he has a valid point here (or he is scared to death for squares and xooms future vs BTC)I remember Bill Gurley arguing in same lines. my question was more what your own thoughts/analyses are regarding the regulation of BTC,specially given the fact that extremely powerfuI institutions would loose a lot if BTC would become mainstream…in fact you can argue that BTC will be up against the most powerful institutions in US, that has had congress in their pockets for decades

        1. fredwilson

          i have spent countless hours with regulators at the state and federal level on this issue over the past few yearsi think bitcoin will be regulated and regulated soundly

          1. E.A

            In other words millions of dollars of lobbying money wont work here? I hope you are right but the big guns havent been shown yet… I think it’s very important here to engage the consumers/voters as much as possible as early as possible so that we can show them their congress guy was /is trying to get bought when wall street starts to make their play on BTC.Many in wall street still sees BTC as a joke but when price goes maybe 5-10x more the real war begins and they certainly have bigger guns ..only way to win over the congress longterm vs wall streets connections and the dollars is to be very vocal and transparent about the corruption to the public so they see who is winning from BTC being scrutinized and why.

          2. Druce

            That means…it will be effectively dollarized, subject to the same money laundering, Form 8300 declarations for over $10K, etc.Because you can’t have transactions that are reportable and subject to AML, taxes etc. if you do them in dollars, and not when you do them in bitcoin.Clearly, after building a massive infrastructure to put every transaction under the taxman and the FBI, put numbered Swiss accounts out of business, use payments and laundering to hammer poker websites, Iran, Wikileaks, Pirate Bay etc., they’re not going to allow a gigantic bitcoin loophole.At which point, if you need a license to transact in Bitcoin and all transfers are tracked and tied to real people, it’s no longer a darknet currency, it’s basically a regulated transmission mechanism for US dollars.Could happen.

          3. Jacob Rideout

            Yep. And I think the incentives line it up to happen that way. For a savvy regulator – either you can marginalize a new technology that will only push it out to the black-market and enable new forms of money laundering and capital flight OR you can regulate it a way that give you more control than ever before …If your read the public notice on BTC regulation from the Peoples Bank of China – they basically outlined their intent to regulate along these lines. Financial institutions can’t hold accounts in bitcoins, but merchants can accept bitcoin provided prices are denominate in yuan. The bitcoin exchanges are now required to collect full identification of anyone performing an exchange and BTC is now a recognized commodity falling under existing securities and trading rules.

          4. Druce

            Not the future the bitcoin fanboys have in mind –…I wouldn’t really be shocked if something like the bitcoin API is primarily used to record/transfer actual US dollars/fiat currencies.’Mining’ has the scent strong stench of absurdity. Even the US mint isn’t silly enough to spend the face value of a coin to mint it (usually). You don’t want the government to fund deficits and debase the currency, so you’re spending the entire value of the coin and then some to create it, instead of taking advantage of seignorage for spending on schools, roads etc. You would literally prefer to send resources up in smoke then let the government use them.

  32. michaelgalpert

    the biggest bummer right now re: the future, are the gatekeepers.coinbase getting pulled from apple is just lame.gonna start requesting coinbase instead of venmo from friends (great tip 🙂

  33. ShanaC

    Ok – Why not Venmo, or Dwolla, or even *gasp* Paypal.Bitcoins if anything make the transaction more sticky – you may have underpaid him or overpaid him by the time he can cash out out the bitcoins.

  34. Sollars&Sense

    We are new to posting on AVC but we have been following Fred for a very long time. We have some words to share as a new digital currency in this space.Choose wisely…Funding does not equal success. Funding does not equal success. Funding does not equal success. Remember BitCoin must convince the People to adopt…Not just Investors, Uber Techies, BitCoin Enthusiasts and you. BitCoin has to convince regular normal people who don’t want to learn a new currency to adopt. We’ve asked, They don’t.BitCoin will come up against a lot of marketing challenges going forward. You can count on it. What will happen in 2014 is a growing list of Alt-Coins and currencies will come out and start to exploit that. It is its fatal flaw when it comes to mass adoption. Someone will do digital currency in a much simpler and easier way… That is what will kill BitCoin’s mass adoption.Austrian school of economics… Definition of money: The most MARKETABLE commodity… #Makes$enseIt is very early in the digital currency race… Choose wisely… said the tortoise.

  35. sigmaalgebra

    ‘Data security’ for such smart phone usage scares theheck out of me.Judging from what I’ve seen in the past, I don’tbelieve that the current information technologyindustry is capable of getting that security rightfor at least another 10 years.I have to expect a lot of lost or stolen money froma lot of lost, stolen, or hacked smart phones andtheir associated Apps. And security for worldtravelers promises to be worse.Heck, I don’t even trust paying by credit card overthe Internet and, thus, have two bank accounts, onewith usually no more than $200 in it (in cast itgets hacked) for buying on-line the other for realgeneral purpose banking.If I want to buy something on-line for more than$200, say, $1500, then I will use the convenientmeans to transfer $1400 or so and make the purchasequickly.My bank’s Web site is had a lot of rough edges, andthey are still cleaning them up. They work hard oncustomer support, with very responsive people, but,still, in their software they have rough edges. Itwill take them a few more years to get this smooth,just a Web site. For the additional issues of asmart phone, maybe smooth sailing in, what, 15 years?Heck, I’m now on the way to losing several days ofwork due to a computer virus I got last night. Duesome of my relatively extreme measures in ‘systemmanagement’, I’m back up now.Still there are some issues outstanding. And that’son Windows XP SP3, used quite carefully andconservatively. The last such virus was worse andfrom one visit to an Asus Web site just to downloada PDF file on one of the motherboards.Smart phones use wireless, and that promises to be arisk: E.g., with the snow, I talked to a neighbor,and he asked about our ISP; he is using wireless andhaving problems, and I’m still with coax and happywith the ISP. Heck, just wireless is causing myneighbor problems.Doing a lot of important work with a smart phone,e.g., with money, important documents, sensitiveinformation, etc. looks to me not very ‘smart’.Coming? Yes. Will it work? Eventually. Willthere be problems? I suspect too many.I’m now losing days to a virus on one of the mostconservative computers on the Internet; I don’t likelosing days. I predict that smart phones will toooften be an unanesthetized root canal procedure forat least 10 years. A business opportunity is to doa darned good job on these problems — my bet wouldbe on Apple.

  36. george

    Perhaps Visa, MC, Amex and all the other merchant card operators have something to truly to be worried about. Looks like the tollbooth may be coming down…

  37. Andy

    Folks… people will pay for purchases using what ever payment method they prefer, which may be different at times or across different purchase segments. Expecting one payment type to trump all others is the same flawed logic as we saw with NFC as “the solution”. There will always be options and people will exercise the freedom of choice when faced with the “how” part of payments. Single use applications are great at helping users find simple ways to get involved in mobile transactions or one sort or another but the real game at foot is finding a way to enable user to exercise absolute choice across a swath of purchasing types from one experience. The Starbucks app is no more of a wallet than the plastic gift card is. To call is one is doing a disservice to consumers by creating confusion around what these words mean.Banks will carve out a roll as will the major card platforms, but the space will not gel until those institutions being to understand the roll they should be playing in this space. They will become facilitators rather than brands… its a harsh reality but most things are when you are witnessing the possible end of an era.The real issue that keeps me up at night and is the single largest threat to digital currencies, mobile wallets and payment apps…. is consumer FRAUD. Today someone could make a transaction on an app and then claim it wasn’t them and win a charge back against the merchant or service provider. Without an independent network based fraud clearing house, an individual could defraud a 100 different apps and no one would be able to stop them.The viability and success of digital payments is a back end issue and has less to do with the front end experience or use case fancy of the month.

    1. fredwilson


    2. Jacob Rideout

      This is another area where bitcoin is interesting. No chargebacks. The risk is instead on the consumer being defrauding by criminal merchants.

  38. BradDorchinecz

    Simple, non-technical fix – Speck has a phone case that stores 3 credit cards in the back. I rarely carry a wallet any more.

  39. Sean Saulsbury

    I wish this would come faster! My wallet is full of bulk and it seems totally unnecessary. Let’s also not forget, for those not living in NYC, our car keys. Many cars have near-field keys; why can’t our phones serve this purpose? Or have this technology for our front doors and office doors?

    1. Kenneth Luna

      what if you lost your phone? not only will you not be able to unlock your car, but you won’t even be able to prove that it is yours. what would you do?

      1. Sean Saulsbury

        How would that be any different from losing your keys? The risk isn’t any different and, arguably, is less because you can disable your phone, password protect it, etc.What about valet? Easy. Have a key fab built into the car. Put the car in ‘valet mode’ and the keyfab activates, acting as the keyfab until the car is taken out of valet mode. Think of the other advantages: the car could report back to you if the engine was revved too high, was driven too fast or too far, etc.

        1. Kenneth Luna

          well no, its less risky. you don’t risk losing your key, personal identification, and financial access points (debit, credit card) with one single device. You’ve spread the risk of losing important items across different items.Here are some scenarios:Lose car key, Not phone, not wallet: Call loved one to get you a key copy to you or pay for a cab to get home.Lose phone, not car key, not wallet: Drive home and disable your phone via your home computer. Or drive to phone store and cancel it.Lose wallet, not car key, not phone: call banks and cancel all your credit cards. Drive home and feel upset.Lose wallet, Lose car key, Lose phone: um …….Putting all these essentials into one easy to lose part of our lives just sounds not-practical.

          1. Sean Saulsbury

            You could: Walk to cell phone store, get new phone, back in business. Save time not having to do all those other things (cancel cards, etc.).That’s just one idea. I’m sure a technological solution would present itself for those concerned about such a risk (e.g., wearables such as a watch that could do some of these things as backup is just one possible idea).

  40. cvander

    In the West coast, using Square Wallet is helping me forget the wallet home more often. Then with Lyft/Uber I always take care of transportation.

  41. Garlee

    I apologize for the naïveté, but couldn’t his friend have been paid via Paypal? What makes the use of Bitcoin so exotic or necessary?

  42. Druce

    Hearing from some fanboys that Isis works … tap-to-pay at a lot of places, cabs, Duane Reade, works in Europe.But it doesn’t run on my Cyanogenmod phone, because OH GOD WHY, the carrier is now inserted into the process and has a snout in the fee trough along with the credit card company, the bank, etc.Almost makes you want to switch to Bitco CASH …. BENJAMINS TALK, HAMILTONS WALK PEOPLE DON’T WANNA KNOW ABOUT NO BLOCKCHAIN WHAT IS SO HARD ABOUT A WAD OF BILLS FFS

  43. Dan Kantor

    It’s funny. I was in Duane Reade the other night and when I went to show my points card in Passbook I realized my phone was dead. I immediately thought ‘what if I was using it to pay’? What would I do? I want to ditch my wallet and keys so badly but the thought never crossed my mind how screwed I’d be if my phone died.

  44. Cliff

    The concerns about security are somewhat amusing considering the inherent insecurity of the status quo. The amount of credit card fraud, check fraud and even counterfeit cash is staggering. Making the type of SOCIAL payment that Fred made only required him to have his smartphone. The friend never saw any personal data, and neither did a bank (at least for the actual P2P transfer piece).And now, finally, the technology is catching up with the requirements for such a trustworthy, reliable, and most of all convenient system. No matter what platform or currency, the compelling point I think of this post is that mobile payments are gradually becoming NORMALIZED. These incremental advancements (smartphones, biometrics, cloud computing) are allowing for new habits and behaviors to form around money, especially for “Generation-M” (those under 30).Seems to me the challenge remains moving beyond the tech-savvy crowd and simplifying everything for the average consumer. Despite PayPal’s early lead, we’re a looong way from saturation of any significance.

  45. Eddie Wharton

    I would love a day when we no longer need our wallets. The need for cash and credit cards is limited. Whether Coinbase, Dwolla, PayPal, Coin or some combination “solves” payment, we will need our ID’s until there is a solution that actually allows us to leave our wallets at home. Also, phone’s die and break so we will need a backup plan. Putting a credit card or ID in a phone case solves the phone dying problem, but not stolen.I think we are pretty close to rarely needing to take our wallets out, but a bit further away from leaving them at home.

  46. A

    The biggest question is why are you splitting the check with your friends? I haven’t done that since my early twenties.Seriously, is this a common thing to do? Don’t most people after a certain age and with a modicum of success just take care of the entire bill and the friends just reciprocate the next time out? At least thats the norm with me and my wife.

  47. David desJardins

    In 2015 will we read a story about how your smartphone battery died and you nevertheless managed to pay for everything on a night out with a magical square piece of plastic from your pocket?

  48. fredwilson


  49. LE

    A few things the could do are:1) Make “why we are better than PAYPAL” front and center to their marketing message. The price appears to cheap and the brain says “must be some drawback to this”. Advantage shouldn’t be only price either but other things.2) The bottom appears to be the drawback “These funds are not eligible for individual insurance, and may not be eligible for share insurance by the National Credit Union Share Insurance Fund.”. FUD. To counter this they might need to bring in some big well know triple A insurance product to distract from the shortcomings in that statement. There is to much FUD in that. I can’t even assess the risk there.Separately of course paypal doesn’t mention how or why your funds are secure with them and I am guessing they never did. Nor does which holds large amounts of money (and I mean large) for domain and other transactions. If they trotted out front and center the fact that there was no insurance I’m sure that wouldn’t exactly help them do more business. (They do very well and recently passed 1 billion in transactions (on which they receive a nice percentage for their escrow services.)

  50. PhilipSugar

    I was really surprised to see Dwolla used in horseracing where we started:…Talking about old meeting new. It was great.

  51. fredwilson

    that’s awesome

  52. LE

    Online gambling being allowed by states (now legal in NJ for example) is a great example of my saying that “you can only be as honest as your competition.” unless you have some really unique advantage over them that allows you to take the high road.Gambling is pretty much bad, period but if you are losing that gambling revenue to another state you really have little choice but to allow gambling in your state.

  53. PhilipSugar

    Gambling is benign compared to credit card companies.A casino or track only wants all the money you have in your pocket today. A financial institution, all the money forever.

  54. LE

    “Gambling is benign”As long as you have will power. Same with any evil.

  55. ShanaC


  56. ShanaC

    alas no android