How The Currency Of The Future — Bitcoin — Is Making Its Way Into School Finances
How the Currency of the Future — Bitcoin — is Making its Way into School Finances
Imagine a world where you can pay for all your school expenses without the involvement of banks, free from fees and security concerns.
Currently, when you make online purchases, such as buying textbooks, you most likely use a card connected to your bank account. However, by the time you receive your next bank statement, you have already shared your personal information with numerous other companies, each taking a portion of the transaction.
Bitcoin offers an alternative to this system. It is a decentralized network that combats hackers and operates independently. Indian Mountain School, located in Lakeville, Connecticut, has taken the bold step of embracing bitcoin, a move that advocates believe is not as far-fetched as it may seem.
While Indian Mountain students cannot currently use bitcoin to pay their tuition fees, the school has become the first elementary and middle school in the country to accept bitcoin for fundraising purposes. These funds support various school needs, such as purchasing new microscopes for the science lab and paying teachers’ salaries.
Jody Soja, the Head of Schools at Indian Mountain, explained that the school had nothing to lose by accepting bitcoin donations. With the help of payment processor GoCoin LLC, which converts bitcoin donations into U.S. dollars, donors, particularly those abroad, can avoid currency exchange rates and fees.
Furthermore, Indian Mountain staff, parents, alumni, and students are being exposed to this emerging technology, creating opportunities for them to learn about and engage with bitcoin and blockchain technology. Charles Allen, an alumnus of Indian Mountain School and the CEO of BTCS, the country’s first public company focused on these technologies, emphasized the positive impact of this exposure. He stated that introducing students to what is happening in the future is crucial, and accepting bitcoin is a step in that direction.
So, what exactly is bitcoin and why do people view it with such optimism?
The origins of bitcoin in 2009 remain a mystery, but it quickly gained a notorious reputation as a platform for illegal activities. Unlike traditional banking, bitcoin transactions can be carried out anonymously. Initially, one bitcoin was only valued at a few cents, but now it costs around $280.
The U.S. Treasury Department refers to bitcoin as a "decentralized virtual currency" – a type of cryptocurrency that manages and tracks transactions using peer-to-peer technology.
Ron Quaranta, the CEO of Digital Currency Labs, a financial technology and advisory firm, compared bitcoin to wider commerce. He argued that for the first time, the need for an intermediary is eliminated at the fundamental level. Bitcoin allows individuals to securely and anonymously share with each other over the network, adhering to the concept of "immutability."
Under the surface, bitcoin operates on a public ledger called the blockchain, a peer-to-peer system that permits the transfer of funds without the involvement of a middleman, thereby circumventing government regulations and bank interference. Each transaction is publicly logged in the database, making it challenging to cheat the system.
Quaranta highlighted the significance of bitcoin by stating that every major bank is exploring ways to utilize bitcoin and blockchain technology. The potential of this backbone to revolutionize commerce is undeniable.
He explained that Indian Mountain School’s acceptance of bitcoin demonstrates their understanding that more people will participate in the "digital currency revolution" in the future.
Even though Indian Mountain School, like many other companies, currently accepts bitcoin, they still rely on processors that function similarly to traditional banks. However, these third-party processors operate outside the conventional framework and offer cheaper alternatives for users.
Allen emphasized the importance for schools to be at the forefront of technology, as the world is constantly evolving. He drew a parallel between bitcoin now and the state of the internet in 1995, noting that while many people talk about it, not everyone is utilizing it.
In conclusion, Indian Mountain School’s adoption of bitcoin as a means of fundraising is a significant step forward. By embracing this decentralized currency, the school is not only benefiting from cost-effective funding methods but also preparing their students and community for the digital future.
“As liquidity in the marketplace increases, it is possible that Indian Mountain School will consider holding capital reserves in bitcoin and using it for purchases,” Quaranta explained. However, he noted that the widespread availability of bitcoin in the marketplace would need to be seen before this could happen.
If you’re still struggling to understand bitcoin, there’s a helpful Medium article titled "Explain Bitcoin Like I’m Five" that breaks it down for you.
Bitcoin has gained some traction in the education sector as well. Since February, when Indian Mountain School announced that they would accept bitcoin donations, a few parents have taken advantage of this option. Soja, an official at the school, mentioned that using a third-party service has made the process seamless, and most donations have been small as people are testing the waters. While some have shown excitement, it is hoped that more people, especially international students, will make use of this opportunity.
The potential of bitcoin and blockchain has also caught the attention of those in higher education. Students at both Massachusetts Institute of Technology and Duke University are exploring how blockchain can be utilized beyond simple exchanges of goods. Quaranta explained that blockchain, being an unalterable and secure database, opens up possibilities for data analytics in the education sector, particularly in the areas of statistics, testing data, and demographics.
The King’s College, a private Christian institution near the New York Stock Exchange, became the first accredited college in the country to accept bitcoin for tuition and fees last year. Indian Mountain School officials have not currently made plans to accept bitcoin as payment for tuition, but Soja mentioned that it is not completely off the table. They are still considering the logistics and are focused on receiving bitcoin donations at the moment.
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