Bitcoin is changing finance the same way the web changed publishing, and in the wake of its emerging status as a “proper” currency, new ventures are rushing to get in on the action. So too is Korbit, a Korean startup founded by Tony Lyu.
There is a Bitcoin craze in Silicon Valley at the moment. Exiting startups in the space are popping up everywhere with Bitcoin startup accelerator Boost VC leading the line in The States. But why concentrate on The Valley? Bitcoin is a global phenomenon and one Korean entrepreneur wants to play his role in the revolution.
Korbit is a Bitcoin exchange, much like Forex is a currency exchange for “normal” currencies, only that Bitcoin transactions are so inexpensive that transferring Bitcoin comes at a fraction of the cost of a normal bank transfer. Korbit acts as the middleman, charging 2% commission on any KRW to BTC (right now Korbit only trade in KRW and BTC but will add more currencies as they go global) but they are constantly working to make their commission as low as possible for the customer.
Because Bitcoin transactions are so inexpensive, Lyu says his company could significantly lower the cost for customers. “We are expanding access to financial services and reducing financial costs by enabling people to buy and sell Bitcoin. We also reduce financial crime and increase government tax revenue by offering a transparent finance network,” he said, and explained that he and his co-founders came up with the idea for Korbit after studying the latest innovations in finance and realized that virtual currencies such as Bitcoin offer many benefits to society. “As entrepreneurs we had experienced inefficiencies in the transaction and payment system in today’s society and realised that Bitcoin is the future. The market capitalization of Bitcoin has gone from 0 to a $1 billion in four years. This is a grand economic experiment, and it can change our fundamental understanding of money and finance” he went on.
The legal environment surrounding Bitcoin is quickly evolving, becoming more complex by the day. As world governments begin to grasp that a virtual currency can and is being used as part of commerce and trade, it means that they will start to regulate the production and use of those currencies. But don't assume that the legal action by New York’s top banking regulator or another investigation coming from the US has left Tony Lyu in a discouraged mood. “We are closely following the regulatory landscape. Regulatory clarity is beneficial to the whole industry and will only serve to raise the value of Bitcoin and make more people use it”, he says. In the future it remains to be seen if Korbit can fulfil its founders’ vision of being a global leader in the Bitcoin world, but in Korea they have a head start on their competitors and it will be interesting to see them stake a claim in the exiting future of bitcoin.
Tony received validation on his ideas in a recent trip to Silicon Valley as part of the beGLOBAL conference, organized by beSUCCESS. Although the company has decided to stay in Korea and concentrate on that market for now, the feedback he received from established Silicon Valley investors, such as Bill Draper, was a huge encouragement and demonstrated that they are working on something that could be an industry leader in the future.
Tony Lyu pitching the Drapers at beGLOBAL
What is Bitcoin?
Bitcoin is an open-source, peer-to-peer digital currency. Among many other things, what makes Bitcoin unique is that it is the world’s first completely decentralized digital-payments system.