Interview by David Berger, CEO of the Digital Currency Council, with Andrew Henson – Founder of BitcoinAdvisor.co.uk. Andrew has deep experience in digital currencies and is particularly enthusiastic about helping individuals and businesses who are new to the Bitcoin economy.
David: Andrew, Thank you for your time today. Could you share with us your background and how you discovered Bitcoin?
Andrew: Thank you David, My background is in software development which I have enjoyed for the past twenty years. I first became aware of bitcoin around May 2013, I was searching the web for high performance computer hardware when bitcoin miners kept popping up. After looking into the price and growth of bitcoin I quickly realized the potential and began buying miners off ebay and placed orders with KnCMiner.
David: Do you recall when you first realized the potential of Bitcoin? When was it that you first decided that you would build your career advising others about Bitcoin?
Andrew: When I first started out there was so much information and nowhere to really go for 1-2-1 advice. I wanted to change that and provide a friendly informative service to allow others to enjoy bitcoin from a safe distance.
David: How do you help your clients? Are you primarily working with clients in the UK or in other jurisdictions as well?
Andrew: I have clients in the UK and overseas, I help my clients by explaining what bitcoin is and how owning some coins will benefit them financially. We also discuss security issues and how to trade bitcoin on the many exchanges that exist now.
David: When you’re speaking with clients, what are the risks that you highlight to them?
Andrew: My first statement to clients interested in bitcoin is a warning over bitcoins volatile price, only invest a sum of money you can comfortably afford to lose. There are also concerns over computer security as bitcoins can be stolen if they are not properly protected. If a client is interested in buying mining hardware that also carries a risk as some manufacturers deliver late which impacts predicted coin yield due to increased difficulty and some don’t make it at all which can lead to devastating financial losses.
David: How important are the tax, legal, and regulatory issues to your clients? Do you work closely with attorneys and accountants on these issues?
Andrew: Tax is a very important subject, keeping in line with regulations is very important for anyone involved with bitcoin. As well as consultancy we have bitcoin and scrypt miners that generate revenue for the company, the value of each coin mined has to be recorded when received and the price when sold to make sure the correct taxes are paid. I work very closely with my accountants Burton Bandini in Stony Stratford UK who are new to bitcoin, it has been a learning curve for both of us over the past year.
David: Where do you see the next opportunity in the blockchain technology? What is the next frontier?
Andrew: The blockchain is an interesting technology, there are a few projects that aim to provide document signing features based on the way the bitcoin blockchain signs the completion of mined blocks and transactions. I think that will be very powerful.
David: There are various ways for investors to gain exposure to Bitcoin – whether into the asset directly, through funds that hold the asset, into ecosystem companies, or through funds that hold ecosystem companies in their portfolio, among others. How are you addressing the opportunity from an investment perspective?
Andrew: There are two options for clients who are interested in bitcoin for investment, some buy and hold in their wallets and check the price once in a while. Others regularly trade bitcoin and profit on the highs and acquire more coins during the lows.
David: Most people don’t have a lot of time to spend weeding through all the information online about Bitcoin. In your opinion, what is most critical for newcomers to understand about Bitcoin?
Andrew: Bitcoin is not a get rich quick scheme, you can make money but you need to take things slowly and be very careful. Negative news in the press can and has shaved hundreds of dollars off the bitcoin price over night. Investors are starting to get immune to some news and not panic selling each time a new piece of legislation comes out. With companies such as Dell, Microsoft and Zynga accepting the virtual currency it spreads confidence and will attract the larger investors and ultimately increase the price.
David: Andrew, thank you very much for your time, insight and membership in the Digital Currency Council.
Andrew: My pleasure.