Here’s another way that digital currency Bitcoin could have a big impact, according to startup BitWall: it could give online publishers a real alternative to putting up paywalls or relying solely on ads for revenue.
The argument for micropayments is probably familiar to most of you: You may not want to pay a big subscription fee but might be willing to shell out a little bit of money to read an article that interests you. Yet the idea has never really taken off with online publishers.
How is Bitcoin supposed to change that? BitWall argues that with traditional payment systems, there’s a significant transaction fee, so small payments don’t make sense. With Bitcoin, where the fees are lower, the startup says publishers “can finally unlock the untapped world of micropayments.”
At the same time, co-founder and CEO Nic Meliones said the team is open to adding other payment options in the future. He also noted that readers who just want to pay in U.S. dollars can do so, since BitWall is integrated with digital wallet system Coinbase, which allows easy conversion between USD and Bitcoin.
Meliones gave me a quick demo of how the system works. After a site has integrated with BitWall, users who try to read an article will be presented with a new kind of paywall, a “bitwall,” which offers a menu of options. The obvious one is making a small payment (as little as 1 cent), via Bitcoin, to access that specific piece of content. But readers can also pay a daily subscription fee, prepay for a larger sum of credits, or even get access by just tweeting or watching an ad (since publishers are usually paid per impression, “an ad is essentially a micropayment as well,” Meliones said).
The point is the publisher gets something in exchange for the content. The exact mix of payment options (as well as which content is bitwalled) is up to the individual site. You can see this in action for yourself with the first BitWall integration, which went live earlier this week at Bitcoin news and data site ZeroBlock. If you click on the headlines in the ZeroBlock News section, you’ll be asked to pay for the article, watch an ad or tweet.
BitWall was part of Boost VC, an incubator for Bitcoin startups, which had its first demo day on Thursday.