KeepKey CEO Darin Stanchfield on acquisition of UK based MultiBit paid entirely in Bitcoin
With many bitcoin wallets out there, KeepKey; one of the fastest growing and most popular Bitcoin wallets is expanding in a big way. KeepKey, just acquired UK based MultiBit in the company’s first ever M&A in true Bitcoin fashion, making the entire purchase in Bitcoin. Yes, you read it right. This is forward in the […]
With many bitcoin wallets out there, KeepKey; one of the fastest growing and most popular Bitcoin wallets is expanding in a big way.
KeepKey, just acquired UK based MultiBit in the company’s first ever M&A in true Bitcoin fashion, making the entire purchase in Bitcoin. Yes, you read it right.
This is forward in the sense that not only does this prove that Bitcoin has indeed established itself as a long term investment for many, but could now become the currency of M&A in the Bitcoin scene.
Moreover, this transaction sets a precedent for other companies further solidifying the use of Bitcoin for larger transactions.
We spoke to KeepKey CEO Darin Stanchfield to find out more about their first M&A, their plans for the future and what the acquisition of MuiltiBit will mean for their users.
Whilst it may seem natural for a Bitcoin wallet to acquire another Bitcoin focused entity in Bitcoin, many outside the industry may find this a little strange or a PR stunt. What makes this transaction different from a more standard currency transaction?
Bitcoin made the most sense for this transaction. For us at KeepKey, we accumulate bitcoin daily through the sales of our device. We hold these bitcoins on our books; we do not convert out, and we are always looking for opportunities to use these bitcoins with our vendors and suppliers.
Being located in a different country, the MultiBit team preferred bitcoin because it eliminated all the speed variables that come with normal bank transactions. When I initiated the bitcoin payment to them, settlement was near instant. There were no wire delays, no holds on the deposit, and they did not have to worry that the funds would later be subject to a reversal. These typical bank transaction problems are amplified when the parties are in different countries. Bitcoin transactions are agnostic to location, and transmit just as fast as if MultiBit were located in our city.
Does this large transaction in Bitcoin set a precedent of sorts showing that traditional methods can be quickly upset and become an example for other companies, in and outside of the Bitcoin sector; of a new norm to an extent?
We believe so, and it validates why we do what we do.
As MultiBit and KeepKey transacted, we both joked that “bitcoin really is pretty cool tech.” Both teams deal in bitcoin, day in and day out, and it’s an incredibly high performing currency that can be transmitted quickly and conveniently. In terms of other companies using this method to make significant acquisitions, I don’t think speed and convenience will be the main driver; I think it will be cost. We paid $0.05 in fees for this transaction. It is hard for even the most skeptical person of bitcoin to not be impressed by that.
The fact that a large Bitcoin transaction has taken place, does this have the ability to in turn affect the market price of Bitcoin and affect the everyday user’s ability to see Bitcoin as a day to day alternative currency?
The transaction itself had no effect on market price, because there was no buying or selling of bitcoin. I would actually argue the reverse. Larger transactions like ours highlight the fact that users of bitcoin benefit far greater from the speed and cost of transactions, than the underlying market price fluctuation of the unit.
What does the acquisition of MultiBit mean for KeepKey and its users?
For current KeepKey users, it means continued tight integration of the device and the best-in-class MultiBit desktop client.
For MultiBit customers, it means their client will remain free and open source. Also, the MultiBit team did an exceptional job: last month alone they experienced nearly 100,000 downloads. With the acquisition, KeepKey brings its resources to the table and can build on that momentum.
First M&A, very exciting, congrats! For most experienced eyes, this is usually a sign of many more to come… What are your plans for the near future?
Thank you! Our immediate plans for MultiBit are to make it ready for the coming changes to the bitcoin network. We also plan to cross-pollinate the features between our existing device, our Chrome extension, and MultiBit.
If we were sitting here in one year from now, what would be the one biggest thing you would have hoped to have achieved?
One of bitcoin’s most promising aspects is trust-less finance. I was able to initiate a transaction from my KeepKey, without involving a counter party, to MultiBit. They did not have to trust me that the funds were good.
Our goal at KeepKey is to make this promise real for everyone, not just bitcoin users. Our hope that in one year from now many more people and organizations are benefiting from this promise, helped in part by products KeepKey offers.
Featured image KeepKey.