Bitcoin Baby Arrives, Conception Funded By New Currency, Dr. C. Terence Lee, a fertility specialist based in Brea, Calif., flashes a photo of a beaming infant across a projection screen and announces: "This baby was bought with bitcoins."
No, this isn't a black-market deal brokered in the Internet's shadowy corners. The child was born thanks to a frozen embryo transfer cycle paid for with bitcoins. Lee says it's the first time he's aware of that anyone has paid for fertility treatments that way.
The baby is the biggest -- and definitely the cutest -- victory yet for Lee in his campaign to persuade his patients to pay him for his services with bitcoins, the experimental digital currency that caught Wall Street's attention recently when its trading price shot up.
There are 11 million bitcoins in circulation right now with a collective "market value" of around $1.4 billion. You can spend bitcoins online at shops like BitcoinStore.com, but they're not exactly a mainstream currency for everyday transactions.
Lee would love to change that. He's an early pioneer in the Bitcoin retail economy, and a sign on his clinic door advertises his accepted forms of electronic payment: Visa, MasterCard or Bitcoin.
The sign alone hasn't generated any business, Lee admits.
"We see 10 to 40 patients a day, and nobody even bothered to ask what the sign meant," he said in recent presentation at Bitcoin 2013, a conference dedicated to the fledgling currency.
So Lee escalated. Determined to find a patient willing to pay him in bitcoins, Lee put an ad up on Reddit last year offering a "male fertility evaluation" -- basically, a sperm test -- in return for 15 bitcoins, which at the time were worth around $5 each.
The customer who finally took up the offer didn't actually care about his sperm count, Lee said. He just wanted to participate in what may have been the world's first bitcoin-funded medical transaction. ("It turned out he had really good sperm!" Lee said happily while recounting the deal.)
Lee is something of an accidental Bitcoin evangelist. An ob/gyn with a geeky streak, he came across Bitcoin around a year ago while poking around on the Internet. The community's passion drew him in.
"I thought it was interesting -- people supporting it as a way for the common man to take back hold of finance," Lee told CNNMoney after his talk. "I was like, 'OK, let me support them.' And then I became part of them."
It took a few months to find his sperm-test guinea pig. After that, Lee grew bolder. He broached the subject with a few of his clients. If he offered a big discount, he asked, would they consider paying him with bitcoins?
"In some cases they reacted like I said I wanted to be paid in vials of crack cocaine," he recalled.
Eventually, though, a few agreed to try it out. And then he hit the jackpot: A couple whom he helped conceive three previous babies came back to try for number four.
"They said, 'Dr. Lee, we don't understand this Bitcoin thing,' but bless their hearts, they were willing to play along out of loyalty," he said. "I offered them a 50% discount."
But actually completing a large bitcoin transaction isn't as simple as slapping down a credit card.
Lee's clients owed him around $1,000 for his services. Lee had to do some digging to find out where they could safely send off such a large sum of cash and have it converted into bitcoins.
"There were nowhere near as many options then as there are today," he says of his experience late last year. "It was like the blind leading the blind."
Lee picked CryptoXChange -- a now-defunct exchange service based in Australia -- and helped his clients create and fund their account, using the international money-transfer services of a local bank. The entire process took several days.
In the end, it paid off on all fronts: Lee got his bitcoins, and the fertility treatment worked.
Bitcoin's volatility has worked in Lee's favor, so far. The 30 bitcoins he collected for aiding in Baby #4's conception are now worth around $3,600 -- easily offsetting the heavy discount he offered.
What goes up, though, can also crash. In April, the value of 1 Bitcoin briefly hit a record high of $266 before plunging back to $165 just hours later. For merchants that rely on their sales for cash flow, that kind of volatility is a huge risk.
Lee claims he wouldn't care if his bitcoins lost their value entirely -- he and his staff are having fun figuring out the technology, meeting new people, and enjoying the economic novelty of a whole new kind of currency. He's even managed to convert a few more of his clients.
"On the Friday before I came here, we did an ultrasound on a patient who paid with bitcoin," he said at the Bitcoin conference. "We may also have the world's first bitcoin twins."
Monday, June 10, 2013
Bitcoin Baby Arrives, Conception Funded By New Currency
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