Bitcoin Linked to Popular M-Pesa Mobile Payment System
The Kipochi Web service launched by entrepreneur Pelle Braendgaard ties Bitcoin to M-Pesa, enabling M-Pesa customers to use the mobile payments system to purchase bitcoins. M-Pesa only operates inside Kenya, and Braendgaard envisions Kenyans using Kipochi so they can employ the Bitcoin system to receive remittances from outside the country without being charged bank or wire transfer fees, as bitcoins can be transferred for free. When a user wishes to purchase the digital currency, Kipochi’s backend servers register an order with a local bitcoin exchange, which charges a 2 percent spread to buy or sell the currency. The exchange transmits the bitcoins to Kipochi’s servers, and Kipochi users get an SMS when their account is credited. The service maps a user’s phone number to a 34-character alphanumeric Bitcoin address, while Braendgaard says users also can send bitcoins to other people by just using their phone number. Bitcoin completes transactions with public key cryptography, and Kipochi’s servers house the bitcoins’ private key needed to transmit the currency. Braendgaard also is working on a bitcoin-using merchant platform called Soko that is designed to address authentication challenges around payments and conditions such as recurring subscriptions.
From “In Kenya, Bitcoin Linked to Popular Mobile Payment System”
IDG News Service (07/11/13) Kirk, Jeremy