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Positive Impact of Bitcoins in Co-working Communities

Iva Köhler is Managing Partner of Prague-based co-working space Paper Hub. Its members, “Paperhubsters” can enjoy an award-winning unconventional co-working space, together with many supporting workshops and events. These focus on promoting innovation, entrepreneurship and off-grid way of living. Paperhubsters have one more thing in common – using ‘Bitcoin’ as the only accepted currency in the community.

With so many great payment technologies, what made you go exclusively for Bitcoin?

The project “Paralelni Polis“ was launched in 2014 by the art group “Ztohoven“ who picked this concept as an incubator and think tank of new technologies that support spreading the idea of individual freedoms. The co-working space is just one part of Paralelni Polis, inspired by Czech philosopher Vaclav Benda’s idea of an independent and parallel society invented during totalitarianism. We thought we could create something similar here.

We believe new technologies are tools leading to a better future and independent way of life, though they can also limit people’s privacy. The founders were looking for a simple way to introduce these technologies to the public, so it can be easily understood and used in everyday life.

They thought cryptocurrencies are suitable for showcasing a decentralized microeconomy in the real world. They came up with the idea of a Bitcoin coffee shop, because they needed to link the technologies and decentralized economy concept with something tangible, and easy to grasp. Back then, Bitcoin was the only cryptocurrency supported by complementary tools such as mobile wallets, specialised ATMs, exchange houses and POS devices, so it was easier to execute.

Can you give me an example of how Bitcoin and blockchain technology impacted Paperhubsters?

Most of our members are already familiar with Bitcoin, but some have never heard of it. All of them came here open to thinking out of the box and learn about new technologies.

We have three types of members. One group is used to using Bitcoin only within Paralelni Polis and consider this an integral part of our internal economy. The other group is more involved, they collaborate in start-ups, brewing new ideas, and they want to pay with Bitcoin outside of Paralelni Polis as well. They want to help spread the idea of decentralized and bank-free economies, and often implement Bitcoin into their own businesses. The last group are speculators earning on Bitcoin volatility.

A few blockchain projects were born in or due to Paralelni Polis: “Bitnotes: Physical Bitcoins” that enables users to “print your banknotes at home” or the “Simple Bitcoin Terminal” which provides easy and user friendly POS. Drawings that are exposed in Polis, were made thanks to Polargraph machine and their authorship can be verified on the blockchain, which skips the contract and guarantee provided by the galleries. Very interesting projects at an early stage are for example a new concept of electricity trading through the peer-to-peer energy market (with Nano Energies) or a new tool for participative democracy “Hra 21” conceived by the Czech mathematician and patron Karel Janeček.

How long does it take someone to understand how to use Bitcoin?

I always imagine my mum when explaining it, and compare it to something familiar to her. Like a shared network of accountants who have the same right to verify payments or other transactions and a Bitcoin address imagined as a bank account. I’d say, it can be explained in two minutes. New users need hand-holding and it is necessary to show them how it works in reality.

We explain how to download the Bitcoin mobile wallet app, how to send and receive the transaction, how to withdraw it from Bitcoin ATM [BATM]. In fact, the BATM installed in our coffee shop has the biggest turnover in Europe due to our intensive focus on education.

What is the Bitcoin transaction and BATM withdrawal cost?

Ours has been provided by Czech company, General Bytes, which maintains it and in exchange keeps a small transaction fee (3%) for withdrawals. However, as Bitcoin is a digital currency and we promote the P2P tools that need no middleman, we strongly suggest to exchange traditional currency to Bitcoin and vice versa directly between members and local users.

How big a threat do you think Bitcoin and blockchain technology represents to established payment services providers and banks?

There’s no clear answer to that. Some visionaries (Richard Branson, Mark Andreessen) are certain this will disrupt the established systems. Some don’t believe so. In my opinion, this depends on users. There will always be division between progressive and more traditional users.

Banks are not worried about losing business due to blockchain technology, but they want to understand how it can affect their work, and employment in the banking sector. Most banks are interested in Bitcoin and blockchain and want to participate and learn. We have had a number of local banks visiting our space for some customized trainings and workshops. We even hosted the innovation team at one of the major local banks, ‘Ceska Sporitelna’.

Do you think Bitcoin has the potential to be more widely used, despite the security concerns associated with the open code platform?

It all depends on the trust of users which takes time. Bitcoin’s security is ensured with P2P transaction verifications and is enforced with an encryption. Media and governments often highlight that use of Bitcoin helps to finance for example terrorism due to its anonymity. This is clearly exaggerated. First: Bitcoins is actually a pseudonymous cryptocurrency, and not completely anonymous. There are specialised companies who can track selected transactions based on IP addresses, and anybody can see them. And there is certainly higher value exchanged for criminal activity by traditional currencies in cash.

The actual issue for governments and politicians lies in the role that Bitcoin and cryptocurrencies play in facilitating informal economics also called the ‘shadow/grey economy’ because it threatens their power over people’s money, extracting taxes and possibilities for manipulation.

What initiatives could help change the perception of Bitcoin and its wider adoption?

We are aware of renewed hope due to an announcement in the U.S. that the Securities and Exchange Commission (SEC) is reviewing its decision to reject a Bitcoin exchange-traded fund (ETF) proposed by Cameron and Tyler Winklevoss. Trading Bitcoin funds would definitely become accessible to more traditional investors who would otherwise not trust it.

Our focus is to help people understand and experiment with this technology. One way how we do this is through facilitating educational events and workshops like our next Hackers Congress Paralelni Polis held on 6-8 October 2017, in Prague. You are all welcome to attend!

Thanks Iva Köhler for an amazing interview!


Author: Michala Kalfirtova

Published on May 2nd, 2017 in


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