BitPay, a Bitcoin payment processor with more than 30,000 merchants on its roster, has announced a partnership with Peter Schiff’s Euro Pacific Precious Metals. Although Schiff has been quite critical of Bitcoin in the past, it seems that he now understands the importance of embracing the revolutionary payment system and digital currency. Many other gold and silver dealers already accept Bitcoin in the United States and other parts of the world, but Euro Pacific Capital is the largest such company to accept the digital currency up to this point. It seems that Schiff falls in the large camp of people who still only see Bitcoin’s promise as a payment method rather than a currency.
Kind Words from Euro Pacific Capital
[dropcap size=small]A[/dropcap]lthough Peter Schiff has been a Bitcoin skeptic for years, Director of Marketing at Euro Pacific Precious Metals Michael Finger had nothing but kind words to say about the cryptocurrency. Finger stated that accepting Bitcoin makes “business sense” for the company due to the fact that “a wire transfer of fiat funds can be slow and expensive for the customer.” Finger also pointed out that credit card fees are simple too high for the previous metals dealers to absorb due to their competitive premiums over the spot price of gold and silver.
An Ironic Partner
At the end of the day, Euro Pacific Precious Metals has to be viewed a a rather ironic partner for BitPay. Schiff has not be quiet about his contempt for gold bugs who have decided to invest some of their holdings in bitcoins, but it seems that the famed investor still understands the value of the technology as a payment platform. BitPay can allow Schiff to avoid any volatility risk by immediately converting Bitcoin payments into dollars for the company. This means that Schiff does not need to worry about a possible bubble in the bitcoin.
Bitcoin, Gold, and Censorship Resistance
One last point that needs to be made in combination with this news is that one of Peter Schiff’s other companies does not operate in the United States due to the financial regulations in the country. Euro Pacific Bank is a traditional bank that allows users to deposit gold instead of fiat currency. There is a debit card attached to each bank account, which means users can actually use their gold holdings as regular money at various merchants and ATMs in different parts of the world. I’ve recently written on the problems associated with backing a Bitcoin-like currency with gold, and it seems that the censorship resistant properties of Bitcoin still haven’t clicked for Schiff. Even though he’s dealing with financial censorship with his own form of digital money at Euro Pacific Bank, he still does not see the value in a crypto asset like the bitcoin where the currency is truly censorship resistant. For what it’s worth, there is still probably a market for a gold-backed digital currency that takes advantage of the Bitcoin technology for processing transactions for its users.