Western Union considering using Bitcoin

[Elwar]

Western Union Co. and MoneyGram International Inc. are studying ways their customers could use their services to send and receive money transfers denominated in bitcoins, the companies' executives say.

"If Bitcoin continues to grow and the value is defined more internationally, we may find an opportunity for Bitcoin to be used to pay for commerce transactions through a Western Union business solution," said David Thompson, an executive vice president and chief information officer of Western Union.

"We've been contacted by folks who are doing various things in this space to see if there's opportunities for us to help enable greater functionality for some of these [Bitcoin companies]," said Peter Ohser, MoneyGram's senior vice president of U.S. and Canada. "But we've not committed and don't have any imminent plans to announce anything."

http://online.wsj.com/article/SB10001424127887324493704578431000719258048.html


Full article:

The fervor over the digital currency Bitcoin has drawn interest from two of the world's largest movers of money.

Western Union Co. and MoneyGram International Inc. are studying ways their customers could use their services to send and receive money transfers denominated in bitcoins, the companies' executives say.

Both companies run remittance networks commonly used by immigrants to send money to friends and family members in foreign countries. Western Union also operates a business-solutions unit that helps companies send payments to other businesses.
 
The firms have no immediate plans to add Bitcoin to the more-than-100 currencies in which each company processes transactions. But both say the increasing popularity of the virtual money has prompted them to consider whether they should make it available in the future.
 
"If Bitcoin continues to grow and the value is defined more internationally, we may find an opportunity for Bitcoin to be used to pay for commerce transactions through a Western Union business solution," said David Thompson, an executive vice president and chief information officer of Western Union.

The Englewood, Colo.-based company is primarily exploring ways its commercial customers may want to use bitcoins, Mr. Thompson said.

Bitcoin is the name for the peer-to-peer payments system that allows people to pay each other from virtual accounts accessed online and on mobile devices, as well as being the term used for units of the digital currency itself. Launched in 2009 by a developer whose identity remains undisclosed, the digital money isn't backed by any central governing body, such as the Federal Reserve, and allows users to remain mostly anonymous—save for their "Bitcoin address"—in transactions.
 
Buzz around Bitcoin has grown in recent weeks because of wild swings in the currency's value, driven by economic turmoil in the euro zone, outages at the largest Bitcoin trading exchange and U.S. Treasury Department guidance stating money-transmitter rules that apply to the likes of Western Union and MoneyGram also apply to exchanges and sellers dealing with the digital currency.
 
"We've been contacted by folks who are doing various things in this space to see if there's opportunities for us to help enable greater functionality for some of these [Bitcoin companies]," said Peter Ohser, MoneyGram's senior vice president of U.S. and Canada. "But we've not committed and don't have any imminent plans to announce anything."
 
While MoneyGram currently has no direct relationships with Bitcoin companies, its money-transfer agents can already help people complete the purchase of bitcoins if they have made arrangements in advance with a payment-processing company called BitInstant LLC.

BitInstant has a deal with a company called ZipZap Inc., which in turn has a relationship with MoneyGram to allow consumers to pay bills and purchase goods from online merchants with cash. That means a BitInstant customer can place an order for bitcoins on its website and then complete the transaction at a participating MoneyGram location with cash, the same way they would pay a bill.
 
The bitcoins purchased through such transactions can't be used to make a MoneyGram money transfer; rather, they are added to a person's BitInstant account, allowing the person to move the bitcoins to trading exchanges and other companies that accept the virtual currency.
 
Because a large portion of Western Union's and MoneyGram's customers initiate or receive remittances in cash, new digital payments services are often viewed as threats to their business. But in its current state, Bitcoin doesn't pose much of a threat, executives and analysts say, noting that the currency isn't widely accepted as payment and its value is extremely volatile, limiting its appeal.
 
So far in April, the value of one Bitcoin unit has ranged from $50.01 to $266, according to bitcoincharts.com. The Bitcoin market is valued at $1.03 billion, according to the site.
 
MoneyGram's Mr. Ohser noted that bitcoins are of limited use to many of the company's customers. About 95% of consumer money transfers done through its agents involve senders and receivers using cash.
 
"Remittances go to pay for housing and for food and for maintaining your family," he said. "If you're sending to a rural part of Mexico, my guess is that the merchant is not going to be accepting bitcoins. They want pesos."

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[BitcoinAshley]

Press press press! Ya think it's about time for people to start trading on news again?

Colbert bump + Western Union/Moneygram bump + MetART bump + OKCupid bump = go bitcoin!!!

[Pangia]

Can you please cut and paste the article.

[bitcool]

Press press press! Ya think it's about time for people to start trading on news again?

Colbert bump + Western Union/Moneygram bump + MetART bump + OKCupid bump = go bitcoin!!!

God, It's SO hard trying not to get excited !!!

[ramus313]

this is exciting news!

[jmw74]

Western Union is going to do what with bitcoin now?

What can they possibly do, other than lay off most of their employees, and use their existing locations to house bitcoin ATMs?

[datafish]

Western Union is going to do what with bitcoin now?

What can they possibly do, other than lay off most of their employees, and use their existing locations to house bitcoin ATMs?

Lol, this.

[bitcool]

Western Union is going to do what with bitcoin now?

What can they possibly do, other than lay off most of their employees, and use their existing locations to house bitcoin ATMs?

Actually, if they position themselves well, their locations can become mini exchanges all over the world.... So instead of exchanging btc at street corner, you go to a WU branch.

[justusranvier]

Actually, if they position themselves well, their locations can become mini exchanges all over the world.... So instead of exchanging btc at street corner, you go to a WU branch.

The vast majority of the kiosks they have all over the world are outside US jurisdiction, or at least would be if they weren't processing dollars.

A foreign subsidiary, for example, could receive BTC and give out local currency without being bothered in the slightest by the regulations and limitations associated with moving dollars internationally.

[jmw74]

Western Union is going to do what with bitcoin now?

What can they possibly do, other than lay off most of their employees, and use their existing locations to house bitcoin ATMs?

Actually, if they position themselves well, their locations can become mini exchanges all over the world.... So instead of exchanging btc at street corner, you go to a WU branch.

If I want to wire money overseas (say Cyprus), I could go to a bitcoin ATM here, insert $100.  It either asks me for a password that the recipient already knows, or it just gives me a code that the recipient can use to redeem.  The recipient in Cyprus goes to a bitcoin ATM, inputs the password or code, receives euros.  As far as I know, the bitcoin ATMs we've seen the demo videos of can already do this (perhaps minus some minor software tweaks to accept and produce passwords or codes that map to bitcoin keys). 

So what exactly does Western Union have to offer?  Just a place to put the machine.
 

[justusranvier]

So what exactly does Western Union have to offer?

Hundreds of thousands of locations all  over the world where people are already accustomed to sending and receiving money via a pre-existing network of affiliates all over the world.

[Operatr]

I smell a fresh exchange hike coming on 

[BTC Books]

So what exactly does Western Union have to offer?

Hundreds of thousands of locations all  over the world where people are already accustomed to sending and receiving money via a pre-existing network of affiliates all over the world.

AND solid, unimpeachable connections to every bank and financial regulating body in the world.

[Peleus]

I'm confused.

What could WU do with Bitcoin that they couldn't already do with fiat?

Wouldn't they have a huge float in an account in each currency and just arbitrage between the accounts to keep them level?

Why would it be necessary to go Fiat *Location 1* > BTC *Tranferring* > Fiat *Location 2* when they can just go Fiat > Fiat

[jmw74]

So what exactly does Western Union have to offer?

Hundreds of thousands of locations all  over the world where people are already accustomed to sending and receiving money via a pre-existing network of affiliates all over the world.

I'm sure their stockholders will be thrilled to have their revenue cut by 99%.

[BTC Books]

I'm confused.

What could WU do with Bitcoin that they couldn't already do with fiat?

Wouldn't they have a huge float in an account in each currency and just arbitrage between the accounts to keep them level?

Why would it be necessary to go Fiat *Location 1* > BTC *Tranferring* > Fiat *Location 2* when they can just go Fiat > Fiat

You're missing some information about how money works.

It is NEVER Fiat -> Fiat (Dollars in New York to GBP in London, for example).  Money takes a circuitous route from country to country with little fees at every stop, and the people who control that route are the banks.  They make their handshake deals...

Bitcoin takes that fee structure away from the banks, and gives it (for much less, assumptively) to the most efficient forex exchanger.

It would take a company at least the size of WU to pull it off.  There's nothing in bitcoinland that's even remotely close.

[gollum]

I'm confused.

What could WU do with Bitcoin that they couldn't already do with fiat?

Wouldn't they have a huge float in an account in each currency and just arbitrage between the accounts to keep them level?

Why would it be necessary to go Fiat *Location 1* > BTC *Tranferring* > Fiat *Location 2* when they can just go Fiat > Fiat

Western Union should look at bitcoin at an oppurtunity instead of a threat. Western Union + Bitcoin would be the perfect marriage.
They got dealers around the world that can thandle cash and financial muscles and would become the no 1 place for people to convert between fiat and bitcoin in person.

[101111]

They can see a disruptive tech that could perhaps quickly undermine them. Better to adopt it than fight it. They have the brand ( = trust,  yes intrinsic value!) and network/physical resources. Cost structure may fall so perhaps profits increase despite lower fees. Aim to become a major player in the bitcoin ecosystem with blue sky potential.

[gollum]

They can see a disruptive tech that could perhaps quickly undermine them. Better to adopt it than fight it. They have the brand ( = trust,  yes intrinsic value!) and network/physical resources. Cost structure may fall so perhaps profits increase despite lower fees. Aim to become a major player in the bitcoin ecosystem with blue sky potential.

We are talking a lot about someone trustworthy that should issue digital dollar IOUs that we can trade against bitcoin - Western Union might be the missing link here, they can take the role as the trustworthy IOU issuer.

[101111]

totally agree with you gollum, and btw you were great in that hobbit movie