Peter Thiel Gets the Bitcoin Bug

Tyler Durden's picture

We recently described in detail what a venture capitalist might see in Bitcoin and it appears that some of that message got through...


Submitted by Michael Krieger of Liberty Blitzkrieg blog,

Interesting news out today in the Bitcoin world.  As you may recall, last week I highlighted how the highly respected venture capital firm Union Square Ventures (Fred Wilson, early investor in Twitter) invested in Coinbase.  Today we learn that another very high profile investor has plunged into the Bitcoin pool.  In this case it’s Peter Thiel, and his investment is in BTC merchant processor Bitpay, a company I have highlighted previously on several occasions.  Back in March I noted that the company was putting up mind-boggling growth rate numbers.  Incredibly, the tremendous growth rate continues as they added another 1,900 merchants in April and are currently signing up around 100 additional merchants a day.    From Coindesk:

Peter Thiel’s Founders Fund is leading a group of investors into funding the merchant services firm BitPay.


BitPay, which offers corporate Bitcoin services, said it had not been looking for funding but the opportunity was too good to turn down.


BitPay founder and CEO Tony Gallippi said: “We raised seed funding in January and February and still had some left so we weren’t looking for money. They approached us, which was a nice surprise because we’d heard that they’d got as far as due diligence with another company in this space. We were really impressed with their experience and energy.”


Asked about yesterday’s action against Dwolla Gallippi said much of the coverage was wrong and once you looked at the actual warrant it was clear it was a very specific problem of non-compliance – “the shell company was not licensed to do what it was doing.” 


BitPay claimed 1,900 new merchants signed up in April and it continues to sign up over 100 new customers every day. It is currently processing around $5m of Bitcoin transactions per month. 


Joining Founders Fund is ‘Mad Max’ Keiser’s Heisenberg Capital – a London-based fund focussed on Bitcoin investments.

As if all this isn’t enough, there’s additional interesting news on Bitcoin recently, in this case with regard to the partnership between Bitpay and Gyft.  This story is getting some mainstream media traction as CNN Money covered it today.  The article notes how you can now spend Bitcoins at 50,000 merchants versus 8,000 before this deal.  But yeah, BTC is the same as beanie babies…

Full Thiel Bitcoin article here.

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maskone909's picture

Fuck yeah end the fed motherfucker

Xibalba's picture

Can we say Kill the Fed instead? 

jbvtme's picture

if bitcoin thrives so will gold

prains's picture

until the lights go out, oops

Western's picture

So sick of hearing this "no internet, no bitcoin" meme..


The elite NEED the internet and electricity more than we do, because their control depends on these structures.. that's why bitcoin is impossible to destroy unless the entire earth is driven back to the stone age. Oh btw, gold will be just as irrelevant in that scenario.

SpykerSpeed's picture

While I love gold and silver as much as the next guy (I own more than ten thousand dollars worth of each), they're just not practical as currencies.  They are magnificent ways to store large sums of value long-term.  But for day-to-day purchases, and moving money outside of borders (and outside the watchful eye of government agents), Bitcoin wins. 

I can use Bitcoin to transfer money to anyone in the world instantly and anonymously.  I can store millions of dollars in a sentence that I've memorized.  Try to confiscate that, TSA.

nmewn's picture

"I can use Bitcoin to transfer money to anyone in the world instantly and anonymously."

Thank you...thats been my point all along...its a conduit, not money.

Now, I really don't give a damn if people want to place bets on the value of the conduit with their fiat money.

Thats their bag, free market and what not.

wintermute's picture

Wrong. Bitcoin is a super-currency because it is the first one to have an inbuilt payment system. It is so powerful that it can potentially replace fiat currencies AND mastercard/paypal/visa etc - at the same time!

nmewn's picture

And leaves your carpet smelling like new!

So now we have a guilt free excuse for not giving when being harrassed by panhandlers at stop lights or Salvation Army bell ringers during the holidays.

Get an account you bums! ;-)

WmMcK's picture

But for day-to-day purchases ... Silver dimes work damn well.

RideTheWalrus's picture

Oh btw, gold will be just as irrelevant in that scenario.

Gold was around for atleast 10 years before electricity was invented by Al Gore's grandmother.

Get your facts right.

Western's picture

Yeah but you didn't have gigantic concrete ruins, tanks, laser weapons, and an entire planet of recently homeless humans. Gonna feed them gold are you?

Hobbleknee's picture

What are you gonna feed them, bitcoins?  Or do you have your entire life savings stored in MREs?

Western's picture

you're such a badass, i admire you

RideTheWalrus's picture

Gold / Silver fed armies for millennia and if we're honest, at that stage it'll be killbots and killsquads going block to block to clean up those cities and hungry people.

If it gets to a point where everything has collapsed then all rules are thrown out.

Gold / Silver will hold a lot of power if you can't trade skills, food, daughers or wives while your looking for a tunnel to crawl through.

Bitcoins will be a forgotten relic at that stage.

Maybe the Terminator films would of been differnt if Arnie was persuaded by a bitcoin transaction to leave Sarah Conner alone?

MeelionDollerBogus's picture

very certain many zh'ers here have said any unwanted advances from those types get them fed brass, not gold. Liberally & efficiently.

MeelionDollerBogus's picture

And that bastard Edison beat her to the patent by just 29 minutes so she couldn't be the proud owner of Gortricity.

prains's picture

but if you're wrong, what then?

MeelionDollerBogus's picture

So sick of your denial of reality. We need money that works with no power and no internet

What happens if I want to BUY stuff to build a power-grid where there is none, or go some place FOR SURE with no power and no internet BECAUSE that's my desired END-GOAL and want to still use money?

Gold can do that, silver can, PAPER CASH CAN but bitcoin can NOT. That's the deal-breaker.

NoDebt's picture

Ummmmm....... I'm not so sure you can safely assume that.  Having gotten into bitcoin a few months ago myself, I can say with a small amount of personal experience behind me that they are different animals in a lot of ways.

If you own both, as I do, you are likely to think of them in very different ways.  Not that there aren't parallels, but they just aren't anything close to the same thing.  I would recommend you not think of them as analogous.  They aren't.  Too many differences.

jbvtme's picture

you can exchange gold for bitcoins.  correct?

MeelionDollerBogus's picture

some have said so but I can't find any that way and I won't offer up any gold of mine for bitcoins. Ever.

nmewn's picture another one.

A man that understands what money is and is not. Real money is not encumbered by anything...devices, codes, accounts, encryption, internet, power...nothing.

It just is and is easily identifiable, even to urban outdoorsmen ;-)

lewy14's picture

nmewn I don't disagree but everything - even "real money" - is susceptible to fetishization.

BTC now has a plausible path to becoming a more widely held unit of account.

Suitable as a unit of account? Signs point to yes.

Suitable as a store of value? Hell no. Not now, likely not ever.

But its suitable as a vehicle for speculation. 

nmewn's picture

Certainly, agreed.

We all just need to come to terms (logically) on what the thing is. Between you and like the idea of its anonymity, its being apart from government oversight, the privacy.

But a Girl Scout selling cookies can't participate in commerce with it. As stated above, the drunk down on his luck, isn't going to have the devices, connection or account to accept a transaction. It takes something besides its etheral existence to make it work, so it can't be money.

Edward Fiatski's picture

Yea, "end the fed" in your digital imaginary world, while sitting in your underpants at home, all the while your liberties are being taken away from you.

Buttcoin clowns.

caimen garou's picture

one way or another the banker monkeys will throw a bananna peel into the works, need to keep the faith in the green backs

jaap's picture

why not  peg a cryptocurrency to the dollar, not only in price but also to the money supply. Then we don't need the interferrance of the new york correspondent banks, cheaper and faster. No issues anymore about the strongly fluctuating rate and manipulation of this rate. ofcourse we keep our gold and silver as the store of wealth....

NoDebt's picture

Mmmmm..... no.  Free float will work better.  If people agree something has value, it wil be reflected in the relative strength of that currency.  "Pegging" anything to anything is a control regime.  It's fiction.  And the "real" world will find ways around it.  Refrence: Venezuela and their official peg against the dollar vs. the real exchange rate in "blue dollars."

wintermute's picture

Why peg world's strongest currency against a watered-down shadow of a currency worth only 4% of what it was 100 years ago?Obama and the Bernank are printing the dollar to death and it is is only the deflationary effects of a monstrous credit bubble which prevents the dollar from collapsing even faster.

Esso's picture

Isn't the goob in the process of shutting down bitcoin?

US seizes top Bitcoin exchange as crackdown begins

terryfuckwit's picture

Nice to see ZH moving away from the increasingly embarresing habit of writing premature obituaries for our bouncing banker bashing baby currency bitcoin.

wintermute's picture

ZH has written bullish articles about Bitcoin since it recently discovered this new currency (or after Tyler loaded up first!)

It is only the doomsday prepper gun-hugging A-team like dinosaur commenters on ZH who have been writing Bitcoin's obituary.



dark pools of soros's picture

pretty obvious you can't read..  this quick article explains what you are confused about.

"Asked about yesterday’s action against Dwolla Gallippi said much of the coverage was wrong and once you looked at the actual warrant it was clear it was a very specific problem of non-compliance – “the shell company was not licensed to do what it was doing.”


{tip jar for impulsive racist defense fund}

lickspitler's picture

Help ME increment BITCHEZ !


RideTheWalrus's picture

Bitcoin bums begging for change. Go beat some buckets on the street corner.


awakening's picture

I don't think that's begging, but the change Bitcoin brings to the table triumphs against that promised (not just delivered) by the Kenyan in the White House.

Cabreado's picture

Pretending to resolve the brokenness (the Real brokenness) by introducing another rogue fiat currency, neglecting the controls that broke the other one, quickly becomes a game of denial.

And if not pretending to resolve the brokenness, it becomes just another sideshow in the casino...

Attempting to skirt the real issues is... somewhat entitled, and somewhat pathetic.

Bitcoin is an ironic representation of how we got here, and how we simply don't get it.
That is what to fear the most.

thelibcentury's picture

Agreed. It is the ultimate deception for those most desirous of a solution.

wintermute's picture

Deceive yourself.

When the grandchildren ask you what it was like to witness Bitcoin as cheap as $100 each, and how it felt loading up, you will look at your feet and tell them to go play outside, as the memory of doing no more than scoffing at it is still very painful.


Bendromeda Strain's picture

Spoken like a true penny stock wanker. It is you who are deceived, make no mistake. There is no anonymity in BTC - that is one of the biggest lies about it, and certainly the most ominous. Your freaking phone money, authenticated by a block chain makes you feel anonymous? It is to laugh and laugh. I don't much care for a large portion of Denninger's offerings, but he did convince me in no uncertain terms that the anonymity argument was pure guano.

Saro's picture

Steps Required to Make Yourself Anonymous With Bitcoin

1. Use Tor.

Happy to be of service.

MeelionDollerBogus's picture

FAIL-hammer. TOR has already been busted wide open. It can't keep you secure at the end-points and it's easy to locate and watch those end-points. People aren't getting security with TOR except for CONTENT not LOCATION. Sorry to remind you (no I'm not) but with money the PHYSICAL location matters.

Thisson's picture

Look, I understand wanting to transact outside of the system, but bitcoin has some serious flaws, including lack of anonymity and vulnerability to 51% attack.  Forking the Block Chain and manufacturing consensus is trivial for any entity with access to serious computing power.

MeelionDollerBogus's picture

You're gonna be one sorry mofo telling your grandkids you paid $100 for btc when they dropped to $3 and then when the dollar collapsed and gold took its place it took at least 10,000,000 btc to get a real ounce of real money.

JimRogers's picture

ZeroHedge marketing geniuses. Able to be on both sides of every trade.

Where's the ZH bitcoin donation address?'

You are and have always been wrong on bitcoin.

prains's picture

bitcoin only works in a cat 5 lab under pristine conditions. out in the shit where things like hacking, fracking and whacking make the real world go round bitcoin is waaaaaay to weak to survive