Many people in the domain space know of or personally know Merlin Kauffman. My opinion is that Merlin is one of the shrewdest domain investors, and he has done very well with his domain investments. In September, I covered his launch of Soothe, which is sort of like Uber for massage therapy. This week, Merlin has made news for a bitcoin related matter.
According to CoinDesk, an online publication that covers bitcoin and other digital currencies, Merlin Kauffman’s “Las Vegas-based bitcoin investment fund CoinSeed announced a substantial investment of $5m in mining hardware on 23rd January.” The article also noted that the company raised $7.5 million from private investors in just a month, and the company has plans to raise an addition $15 million in funding from private investors as well.
Judging by some of Merlin’s comments in the article, I would assume that he raised some funds from people and companies in the domain space. This wouldn’t really be a surprise because Merlin has built solid reputation amongst his peers and colleagues, and domain investors are often looking at other means of generating revenue outside of the domain space.
I still don’t know all that much about bitcoin and cryptocurrency, but I hope that Merlin has the same good fortune with CoinSeed that he has had with his other domain investments.
That is a lot of money for such a volatile unregulated, unsourced currency.
I mean how long before somebody does something stupid in regards to purchasing illicit items that cause national news headlines, before governments shut it down. It is just like online gaming, Tobbaco etc… If the government can’t tax it, they outlaw it. Some big SV companies have a hard time raising that much cash, so best of luck.
See: Silk Road
The government has tens of millions in BTC from seizures already like Silk Road. Just on the news that they plan to sell their bitcoin, the price drops. It is VERY volatile, but that volatility means that numerous people are going to make some serious cash. I would think now is the time to get involved, like Merlin has. This volatility = opportunity. With that said, YES, I own several BitCoin and will probably get more. It’s interesting, but yes, as you said, very unregulated.
Aaron who are they going to sell them to, Russian hackers? Guy at the Starbucks? They need to figure this out, as they wrote many if the laws that circumvent such money laundering processes.
There are alot of people who have had issues with money wires into us banks after selling Bitcoins in EU exchanges.
Liquidity for instant cash in your account, can be an issue at times. Sure money sitting in a virtual account waiting to be hacked is not enough.
I have seen over a dozen bitcoin type payment systems pop up, Peercpin seems to be runner up, but Bitcoin seems to be the first to market headline maker. It reminds me of hot potato, nobody wants to get stuck holding the ball on this one, but the smell of greed is a powerful thing.
Love Melin and wish him success.
I am kinda taking a break (except checking offers) from Domains, been doing it since 1998, burned out, and the all the new .whatever extensions have put me to sleep and I have really refocused on Virtually currency. I have invested in 3 of them already, and spend my days doing that. It’s risky but the ROI can be amazing, way better than domain investing IMO, so either I will have great news to share in 1 year, or I will be broke, but got to take a swing at it(lol)
Sometimes taking a break and doing something else can reinvigorate you.
Hope you enjoy your sabbatical and find it profitable!
Crypto currency is another name for a “Pyramid Scheme”……. Those holding the bag in the end will be hurt the most…….I propose the “MaddoffCoin”. …It can be exchanged in prison for Kool Aid.
Well Bitcoin mining has become very popular with guys out in Eastern Europe, but the power to run the hardware to mine the bitcoins can be very expensive, I guess there are routes thru technological advancement this company will explore to build a better mouse trap. Essentially like a company mining for precious metals, as long as the price stays above X it is profitable, otherwise they have to shut down the mine.
Overstock and many retailers are either akin or gearing up to take Bitcoin. It’s legitimate and going to be huge.
Your talking about “pump and dumb currencies”, 95% of them are like that so your right, but you need to look at the coins that merchants are accepting it. Have you heard of overstock, Sacramento Kings, major casinos, target announced it will be accepted as well. ATM’s are going up all over the world for virtual currency.
When something gets that big, and is unregulated, Uncle Sam wants their cut… how do you intend to keep them at arms length?
Ok. I couldn’t resist.
BlockChain.info has raised $Xm.
BitInstant.com has raised $Xm.
Circle.com has raised $9m. (look at their BOD)
BitPay.com has raised $Xm.
CoinBase.com has raised $31m.
MtGox.com has raised $Xm.
BitcoinTrust.co (SecondMarket) has a $65m fund.
Fortress.com has planned a $150m Bitcoin fund.
WinklevossCapital.com (ETF – IPO) >>> Facebook “founders”.
Buttercoin.com is backed by Google Ventures and Y-Combinator.
And there are about a dozen other companies, on a global scale, that have raised a very healthy VC round.
It is always so sad to see uneducated or naive people take such a strong stance on something they are absolutely clueless about. I would never force my opinion on anyone, but here is some “real” research. Knowledge.
First, Bitcoin (uppercase B) is a protocol like email – a revolutionary and disruptive technology. Second, bitcoins, (lowercase b and plural) is the “coin” that some people refer to as “digital currency OR virtual commodity”. At the end of the day, it is definitely volatile, but it is new. Very new. It just hit the mainstream media the first week of November 2013.
The price of bitcoins (1btc) is the least interesting thing about Bitcoin. That being said, there is a TON of money to be made in the industry for the next few years since the masses simply don’t understand or refuse to believe it like MANY people still do about the billion dollar domain industry. Right now, the value of the network equates to nearly 13 million – of the 21 million maximum – bitcoins which represents more than $10 BILLION U.S. DOLLARS. Numbers don’t lie. The BitcoinWallet competition (companies and industry) is heating up with nearly $100 MILLION in VC, just like the Bitcoin ATM machine industry is finally growing legs with more than 200 units in sum sold from various manufacturers. The Vancouver ATM did 2.2 MILLION in transactions in the first 60 days. Numbers don’t lie, people do.
Bitcoin has leaked to OverStock, who did $130,000 in sales of bitcoins in the first 24 hours. Also, TigerDirect, The NBA, Vegas Hotel & Casinos, and Airlines have jumped on board. The Chicago Sun-Times is now accepting bitcoins as well. And, PayPal’s president says he likes Bitcoin AND owns bitcoins. In fact, recently, it has been rumored that eBay and PayPal will test payment with Bitcoin. Someone used bitcoins to buy a Lamborghini and a Telsa, both vendors exiting using BitPay to convert BTC to fiat currency — instantly — without risk of the price swings.
For merchants, (no chargebacks and 1% verses 2.5%) it simply makes NO SENSE to avoid Bitcoin.
Some people will buy and sell, day-trade, like they do with commodities, stocks, and bonds. It’s a hobby, passion, lifestyle, and “expertise”. Some will buy and hold, as a store of value, like Gold, Silver, or any commodity. Others will buy and spend freely, investing or “playing” in and out, as a viable payment method, especially in the case where merchants offer a discount for using bitcoins.
Where, and with what, in the history of mankind can you send $1,000,000 from New York City on a Sunday evening at 3:45am to Dubai for pennies…? NEVER. Ever.
In the future you will be able to have “zero trust contracts” and numerous other “digital innovations” that will be used on a global scale all based on the Bitcoin technology, the block chain. Some of the brightest coders/hackers and computer scientists on the planet Earth are working on the Bitcoin network as we speak.
In my opinion, for whatever that’s worth, Bitcoin is like the Internet was in the early 1990’s…and it isn’t going away any time soon.
Ps: Until you watch the Senate hearing – complete 2 hour video on Circle.com – and visit Bitcoin.org AND Bitcoins.com, CoinDesk.com, etc., …you will simply not understand what is happening right before your eyes.
The world is changing, …forever.
– The currencyevolution team / sponsored by BitcoinWallet.com
“Your talking about “pump and dumb currencies”, 95% of them are like that so your right, but you need to look at the coins that merchants are accepting it”……..
If 95% of crypto currencies are “pump and dumb”, how and why would a government allow the other five percent to exist? The whole idea behind the crypto currency craze is “greed”. Most crypto currency investor’s understand the risks yet continue to invest because of the reports of getting rich quick…Very similar to penny stocks with high volatility…Someone is always left holding the bag, whether it is full or not…
Target, Overstock and the others accepting crypto currency can afford these risks. Time is very limited as regulation is sure to come as criminals endorse crypto currencies, shop at Target, Overstock, and have season tickets at the Sacramento Kings…..Throughout history there has always been a way for criminals to “launder” money. Crypto currency is the newest and best for “laundering” and thus you have it’s popularity…..
Interesting times when a financial currency; Bitcoin can build a reputation off the dark side. PR turned on its head. Look forward to Elon Musk taking a holding !! until then good luck to Merlins investors.
Nothing to stop Uncle Sam and if/when I cash out on my investment, let’s say to buy a boat who doesn’t accept virtual currency, yes I will have to pay taxes on it. I don’t think Uncle Sam will try to destroy virtual currency if they can make money off it. As always, time will tell what the future holds, but I like the whole “movement” behind virtual currency, and even though I have not cashed out yet, my ROI is around 100% so far, and I just started Jan 1st of this year, so see what happens.
@Aaron, same things happen in “fiat” currency as well. We will see how it plays out. BTW, I can afford to take risk myself, just like in 1998, I went all out in buying domains, 95% people told me it’s a waste of money, meanwhile, they were wrong, I was right. Same thing here, 95% will say the same thing, but I will give you my report on Jan 1st, 2015 and see where I am at. Like always time will tell, until then, everybody has an opinion.
It’s so nice to hear and read that you done your homework! You nailed it buddy!!! We don’t need to convince nobody, numbers don’t lie, and that is what I love about this!!!
Jim and Michael,
“Numbers don’t lie, people do.”……….Agreed!..My point exactly………..That is why I see crypto currenecies going down from here on……..
Meanwhile, I appreciate and respect your opinion’s and wish you all the best……
This stuff is way out of my league so I will quote Nobel Laureate economist Robert Shiller, “It is a bubble, there is no question about it…. It’s just an amazing example of a bubble.” He added that he’s “amazed by how people are so excited about it” and that he tells his students that “No, it’s not such a great idea.”
All the best to Merlin, if you can make a buck and get out, I am all for it.
However the long term is a huge risk….
And mainly because I do not believe a government in any country will allow this to get any bigger or better without doing something. Also bitcoins are worth what exactly, oh yes real currency, otherwise they would not be accepted. If this catches on maybe we can hype sticks off of tree’s again as trading tools, was once a hot currency not long ago.
Good quality informed report:
Jonathan, I read the article and was put off by the either false or misleading style at times, for example.
“Bitcoin has a remarkable set of interlocking mechanisms that make it exceedingly hard for any individual or group to accumulate enough power to distort the public block chain, a sequence in which one set of transactions builds upon the next. If such distortion took place, it would become known, and various scenarios have been painted about what kind of response would occur. (Some suggest Bitcoin would collapse, and thus that no party would engage in attempting it, however impractical it would be to achieve.)”
This is pure BS, it isn’t hard at all, has nearly been done and only out of personal interest was it stopped. Sorry but this is not an informed report at all, or perhaps a very old and ignorant one.
“I have little faith that it will become a replacement for dollars, euros, or renminbi. As a model for a future payment and transaction system, I believe it’s already shown its value.”
An opinion, not worthy of the term BS.
(Original published Jan 21 2014 – updated Jan 23 2014)
I called the statement I quoted BS, don’t dodge the facts by throwing a statement in that seems worthy but had nothing to do with what I quoted. His well informed reporting was there was no threat to bitcoin, he is wrong and that was a huge oversight imo. In fact an oversight like that changes how the rest of the article should go.
Obviously I do agree it will not replace other current currency but not because of any reason other than it was never going to even if it had next to no flaws. It isn’t government/Fed controlled, game over.
“Jonathan, I read the article and was put off by the either false or misleading style at times, for example. ”
“Sorry but this is not an informed report at all, or perhaps a very old and ignorant one.”
True but I specifically called the one quote BS, the one you mentioned can be chalked up to absolute common sense. Bitcoin over take the USD… I am willing to bet no one thinks that is coming. So essentially the best or most accurate point n the article is common sense.
We could go back and forward, point is I disagreed with most of it and once a reporter or journalist in any field starts to show short comings for real investigating/research or has a bias, I check out.
Here’s another article about CoinSeed:
Great news, but let’s see some numbers.
Bitcoin was $925 on 1/24 when the investment was announced.
Now, 2/13 it’s floating at $460.
That’s a 50% drop/loss in 3 weeks. How does this translate into investment performance?