Tech Alumni Get in the Bitcoin Business
To some, thinking about bitcoins may bring visions of a Super Mario Brother jumping to take a glimmering gold circle.
To Tech alumni Tony Gallippi and Stephen Pair, it brought a business opportunity — Bitpay.
A sponsor of Georgia Tech Athletics this season, Bitpay is a payment processor that deals in bitcoins, a virtual currency. Founded by Pair and Gallippi in 2011, Bitpay provides a way for businesses to take bitcoin as payment — similar to the way a service provider offers Internet service to a home or business.
“It’s been a 20-year path for me to get here,” said Pair, who graduated from Tech in 1994 and began his career in consulting. “I recognized money was a worthless piece of paper with worthless ink, which meant it was just an informational thing, and you must be able to replicate it in a computer somehow.”
In 2010, he read a whitepaper about bitcoin and, sensing its potential, got in touch with his friend Tony.
“The first time we both read about it, we needed to learn more,” he said. “After studying it, Tony picked up on its ability to solve fraud problems with credit cards.”
With their interest piqued, Pair and Gallippi focused on developing business tools for bitcoin, which led to Bitpay. Pair and Gallippi relocated Bitpay to Atlanta last year because of the city’s financial technology community as well as convenient access to Tech students as interns. They’ve since expanded business into South America and Europe, raised more than $30 million in venture funding, and have signed up more than 30,000 merchants for their service.
“Our ideal customer right now is an ecommerce customer that is selling products,” Pair said. “International credit card transactions are risky, the rate of fraud is high and the merchant eats the cost. Bitcoin lets you take payment from anywhere on earth.”
Though Bitpay focuses on commercial use, Pair encourages people to explore using bitcoin for their personal transactions, starting with bitcoin.org.
“Don’t put your life savings in it, but download bitcoin software, play around, buy something, test out the technology,” he said. “It operates just like cash, but for the Internet. You use it the same way you use cash, it’s just electronic.”
His young son is interested in exploring the technology but is still learning the ropes. A couple years ago he had saved $200 in change and spent hours counting it out to buy an electric scooter.
“He blurted out, ‘Bitcoin is way better than this,’” Pair said. “What he didn’t realize is that you pay in exact in amounts with bitcoin, so he wouldn’t have had the change in the first place.”
Though neither Pair nor Gallippi remembers his first purchase with bitcoin, they remember the significant ones. Bitpay used bitcoin to sponsor Georgia Tech Athletics this season, and Gallippi used it to buy a Tesla.