Case Study: Enabling Bitcoin as a Medium of Exchange at the Bitcoin Asia Conference in Hong Kong

The Bitcoin Asia conference held on May 9-10, 2024 in Hong Kong demonstrated a significant milestone in the adoption of Bitcoin as a legitimate medium of exchange.

This article describes the strategies and technologies applied to facilitate seamless Bitcoin transactions of goods and services over the course of two days, leveraging the capabilities of self-custodial payment processing through… BTC Pay server.

Executive summary

Throughout the event, 212 Bitcoin transactions were processed, involving four sellers for a total of 7,714,253 sats, equivalent to HK$36,974.63.

The average transaction was about 36,560 sats (about 175 Hong Kong dollars). Notably, the system maintained full uptime with no failures in the Bitcoin main chain or Lightning Network transactions.

What is BTCPay Server?

With banks, you don't have a choice between self-custody or payment processing custody.

For example, if you wanted to run a self-custody business using fiat currencies, you would have to run a cash-only business, which carries a significant risk of theft when capital is concentrated in one place. This would also limit your customer base.

To expand our economic reach beyond our local economies, we have created payment networks and payment processors that enable digital transactions.

But what are the consequences of implementing custodial payment systems over time? Why don't we have a self-custodial digital payment processor? What innovations, freedoms and data do customers and businesses have to sacrifice due to custodial payment processing? What if my digital payment method (e.g., credit card, Apple Pay, Venmo) is declined even though I have funds in my account? What valuable data – both financial and personal – will I now give away for free because of these services?

By using the BTCPay server, we can digitally facilitate a cash-like transaction experience, which means we can make peer-to-peer digital payments. Transactions do not require personal information from the payer, nor do they require an intermediary. This eliminates the risks that come from dealing in cash and relying on an intermediary.

BTCPay Server is free to use and completely open source, which means that BTCPay Server is not a company – it's just code.

BTCPay Server is a Bitcoin payment processor that allows businesses and individuals to receive payments directly, without relying on third-party services.

Unlike traditional payment processors, BTCPay's server holds the funds and does not charge any transaction fees.

BTCPay Server is a highly adaptable payment processor. It can be integrated into existing systems using Application Programming Interfaces (APIs), and both individuals and businesses can tailor their payment processing experience to meet specific needs, ensuring seamless integration into their operational frameworks.

In addition to the above features, the BTCPay server supports what is known as Prism payments.

This function enables unreliable distribution of funds across multiple accounts at the point of sale. This innovative approach fundamentally rethinks the flow of money, enabling real-time compensation for stakeholders and employees.

How to use BTCPay server

Step 1: Set up the BTCPay server

For a comprehensive guide on setting up a BTCPay server, see this Full step-by-step tutorial on YouTube.

The second step: ensuring liquidity and price stability

At the time of writing, the Lightning Network is the only Bitcoin scaling solution that maintains Bitcoin's cash-like properties of making payments with BTC.

The accelerated network facilitates instant settlement, requires no KYC and offers almost zero fees, just like the cash experience.

For the accelerator network to work, it needs liquidity. Providing liquidity often means running and managing the node yourself, but BTCPay Server does it for you.

At the conference, BTCPay servers were held, in conjunction with eyelashwhich served as the liquidity provider for the conference, worked flawlessly, ensuring that the payment never failed.

In addition to using an additional liquidity provider, we also used a price hedging solution in case we were exposed to Bitcoin price fluctuations during the conference.

This risk had to be addressed because vendors who accepted Bitcoin at the conference wanted to get paid in their local currency once the conference was over.

The bearish scenario for the seller is to receive a $10 Bitcoin payment at the time of the sale while the Bitcoin price was high, and then, during the conference, the Bitcoin price would have fallen by 50%.

In this type of situation, when it comes time to make a settlement in the supplier's local currency, he will only get $5 in his local currency, which is unacceptable.

To mitigate this risk, we used “stablesats,” a Blink feature that allows instant conversion into a synthetic version of a stablecoin (such as the Hong Kong dollar) at the point of sale.

Learn more about Blink features and services here.

Step 3: Deploy the physical POS hardware

Despite the digital nature of Bitcoin transactions, physical point-of-sale (POS) devices have been deployed to provide a familiar payment experience for attendees and vendors.

We used point of sale devices from Bitcoinize. These devices also facilitated the issuance of physical receipts upon request.

Step 4: Simplify Bitcoin access with Boltt Cards

To facilitate smooth Bitcoin transactions at the conference, we also used Bolt cards.

These customized “Bitcoin Asia” issue cards allowed attendees to convert fiat currency into Bitcoin for use at the event. The cards allow direct tapping via NFC technology on point-of-sale devices.

Step 5: Train traders and employees

A training session was conducted before the conference to familiarize vendors with how to use the BTCPay server.

The 10-minute session was efficient, with minimal questions from participants.

A group chat was set up for support, which remained largely inactive due to the smooth operation of the payment system.

A full video of the course is available here.

Conclusion

Thanks to free and open source software like BTCPay Server and innovative solutions from companies like Blink, handling Bitcoin transactions at the Bitcoin Asia conference was a breeze.

The success of using a BTCPay server at the Bitcoin Asia conference demonstrated the potential for broader adoption of Bitcoin in everyday commerce.

Consider using solutions like these for your next event or within your local economy.