Spending bitcoin: Brisbane CEO crypto experiment after being paid in digital currency

There are plenty of warnings about investing in bitcoin but Lachlan Feeney has gone one step further putting his whole salary on the line to test the cyrptocurency.

Brisbane CEO Lachlan Feeney conducted a bold bitcoin experiment, where he paid his salary in the cryptocurrency for six months, and only paid for things with the digital coin.

It comes as an increasing number of Aussie businesses are paying staff a percentage of their wage in cryptocurrency, while a quarter of Australians would happily have a portion of their salary paid in bitcoin.

The 22-year-old is the founder of Labrys, a blockchain development agency, the technology that underpins cryptocurrency.

He said he took on the challenge to prove that bitcoin can be used in everyday life.

“Bitcoin probably has a bit of a branding problem in terms of it’s touted as this next evolution of money, the future of money and that everyone is going to be using it day to day, but not many people that I know, even in the blockchain space, actually use bitcoin as money or as a currency day to day,” he told news.com.au.

“So I decided to do an experiment to see if it was feasible to live entirely off of bitcoin and I figured if I was in the blockchain industry and running a blockchain company that I should probably give it a go and try and do what I preach.”

Mr Feeney spent just under $1000 a week for rent, bills and utilities, groceries and other things like coffee and dinners.

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Mr Feeney spent $1000 a week in bitcoin during the experiment. Picture: Ozan Kose/AFP

Thriving cryptocurrency community

He used an Aussie payment gateway service called Living Room of Satoshi to pay his bills like phone, internet, electricity and gas in bitcoin.

“Not many people know that Brisbane has a thriving cryptocurrency community. There are a number of businesses, cafes and restaurants that accept bitcoin directly for payment. There is an IGA in Bowen Hills in Brisbane that you can do grocery shopping in bitcoin directly,” he explained.

“So it required a little bit of a lifestyle adjustment in terms of if I really wanted to shop at locations that accepted bitcoin directly, then I might need to go a bit further up the road to get dinner or go to shops, but it’s definitely feasible.”

The places that accept bitcoin directly, have a device like an iPad that brings up a QR code, which you scan with your phone and pay over the bitcoin network, explained Mr Feeney.

With the price of cryptocurrency fluctuating wildly recently, Mr Feeney also spent 0.003 bitcoin on two regular pizzas during the experiment, which was the equivalent of $43 then, but in today’s prices, that adds up to $113 per pizza or $226 total.

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His two pizzas would now be worth $226 in today’s prices – that’s some pretty expensive slices. Picture: Supplied

Fees and charges make bitcoin expensive to use

But he did identify one huge problem with buying in bitcoin.

“One of the reasons people don’t use bitcoin as money is it’s actually very expensive to use. So the average transaction fee on the bitcoin network at the moment is around $20 per transaction and so if you are going to buy a coffee from a store and a coffee is $4 and a transaction fee is $20, it doesn’t make a lot of sense,” he said.

“So I was using a bitcoin wallet that allowed me to do transactions at low and no costs, otherwise it wouldn’t have been very practical.”

Living off bitcoin isn’t as impossible as the average person thinks but the experiment wasn’t easy either, said Mr Feeney.

He had to use a lot of conversion services that all take fees, while bitcoin was also down, starting the year at around $14,000 and ending at $7000 a coin when he started the experiment.

“A lot of people might think that I did the experiment because I thought I was going to be financially better of because of it, but the reality was probably the opposite,” he admitted.

“I wasn’t making any money by doing this and I wasn’t doing it because I thought it would give me extra dollars to spend on luxury items at the time. In fact, I was probably missing out on a few extra dollars each week because of the experiment.”

But he was fortunate to be able save a portion of his bitcoin income, he added.

“I basically haven’t touched any of that bitcoin that I saved and didn’t spend from the experiment, so obviously bitcoin has appreciated significantly since then,” he said.

He has called on others in the blockchain community to practice what they preach and starting buying in bitcoin. Picture: Supplied

Crypto the way of the future

Despite the roadblocks he encountered, Mr Feeney does see a future where Aussies are being paid in bitcoin and spending it in everyday life as well – predicting it will come on board in the next decade.

“It’s becoming quite popular for sports stars to take $20 million or $100 million of their salaries in bitcoin – there seems like a few new ones coming out every week – so the point of the experiment is it doesn’t matter how much you’re spending or if you’re taking in a $100 million salary or taking in a couple of hundreds bucks a week from part-time job,” he said.
“The conclusion is it’s possible for anyone to live off bitcoin and use it as what it’s intended for. I’d especially encourage those in blockchain industry in Australia to do what I did and put their money where their mouth is and give it a go.

“See what it’s like to live off the technology that we all preach and believe is the future.”