The NBA's Sacramento Kings said that they will start accepting bitcoin for tickets, jerseys, hot dogs and beer at the arena. They the first professional sports franchise to embrace the alternative currency, and the man who broke this story, Michael Casey, joins MoneyBeat. Photo: AP.
Sacramento Kings To Accept Bitcoin
NBA Team Is First Major Sports Franchise to Take Bitcoinby Michael J. Casey | The Wall Street Journal
The Sacramento Kings basketball team will become the first major professional sports franchise to accept bitcoin in return for its products, marking a symbolically important step in the virtual currency's bid to achieve mainstream acceptance.
"The way I saw it, bitcoin had reached a tipping point where it had crossed from being a curiosity to a becoming a legitimate form of doing commerce," said Sacramento Kings owner Vivek Ranadivé, explaining his decision to allow payments in the virtual currency. Mr. Ranadivé, who has coined the phrase "NBA 3.0" to describe his vision for a National Basketball Association that uses technology to energize basketball's relationship with its fan base and establish a global presence, said the Kings' adoption of bitcoin "is yet another step in that process."
According to Mr. Ranadivé, the founder and chief executive of Tibco Software Inc., fans will be able to buy everything from tickets and jerseys to hot dogs and beer with bitcoin, whether via online transactions through the Kings' website or in mobile payments at the stadium. Payments will be processed by Bitpay, the largest bitcoin-payments platform. The goal is to have all consumer transactions open to bitcoin by March 1.
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The Sacramento Kings basketball team says it will now accept bitcoin in return for its products. Above, Sacramento fans during a Kings game against the Detroit Pistons in November. Associated Press
The exchange-rate volatility, which saw Coindesk's Bitcoin Index soar from $13.51 at the start of last year to a November peak of $1,165.9 before it dropped to $757.50 at year-end, has raised questions about the viability of the virtual currency. The Bitcoin Index was recently quoted at $863.35. Such large price shifts are expected to deter the public from adopting it as a unit of exchange or a store of value.Notably, Mr. Ranadivé said he will be willing to take bitcoin for the Kings' own account, unlike other merchants who have contracted Bitpay to process payments in the virtual currency but have elected to receive dollars at the end of the transaction. He said he isn't concerned about the extreme volatility in the virtual currency's exchange rate because over time he expects to see increased trading and transactions in the currency and the development of more sophisticated exchanges and derivatives instruments. "It's only a matter of time before the volatility goes away," Mr. Ranadivé said.
But the past year's chart-popping price action has also stirred interest in bitcoin, which was launched in late 2008 by a mysterious person or group bearing the name Satoshi Nakamoto, a founder who has never been formally identified. Meanwhile, a number of investments by venture capitalists and tech firms in bitcoin-related projects have helped to expand and deepen the infrastructure surrounding the virtual currency, which in turn has enticed a small but rapidly growing number of merchants to allow bitcoin payments.

Bits and Pieces

Mystery still surrounds Bitcoin. Its creator -– or creators -– has remained anonymous and specific details surrounding the history of the virtual currency remain fuzzy. Still, buzz is growing, despite recent wild swings in the currency's value. Here's a rough timeline of the Bitcoin evolution.

The question now is whether the currency, whose supply is delivered by "miners" who obtain it by solving a complex computation problem, can go mainstream. And to that end, Mr. Ranadivé, who first took interest in bitcoin after his children's friends asked if they could use their bitcoin at the stadium, believes he is playing a facilitating role.
Mr. Ranadivé expects other NBA franchises to follow his lead—as with other innovations he is bringing to the Sacramento team. Among those: plans to have his coaches wear high-tech Google Glasses on the sidelines to enhance their understanding of the play.
But Sacramento, the 19th-largest market in the NBA, is better placed for this initiative than almost anywhere else. On the edges of Silicon Valley and boasting a steady influx of high-tech firms of its own, the city is plugged into a "tech mind-set" to which bitcoin appeals, Mr. Ranadivé said.
The owner also benefits from a loyal fan base, helped that he is credited with keeping the team in Sacramento.
Last year, Mr. Ranadivé purchased the Kings for $534 million in a deliberate move to beat out a prior bid by Microsoft Corp. CEO Steve Balmer, who would have uprooted the team from its 28-year home in the Californian capital and moved it to Seattle. Ever since, ticket sales have surged, with the team registering the highest rate of attendance growth year over year and the highest rate of new season ticket sales. There is no other major sporting league team in the city.