Buy a pizza with Bitcoin?

A commenter on an earlier post said they wouldn't use Bitcoin until they could do things like pay a restaurant. Well, now you can - and the restaurant doesn't even know it. Here's how.

You can buy from thousands of restaurants online and pay for the food - and delivery if available - with Bitcoins. Maybe not where I live in rural Arizona, but in many large US cities.

How? Foodler is a web-based service that's been around since 2005 and - the CEO told me - is profitable. They've automated the restaurant search and food ordering process.

And as of last month they accept Bitcoin as payment, automatically paying restaurants and delivery services in dollars at the current exchange rate. They even pay Bitcoin transaction fees.

Foodler makes money by charging restaurants a commission on each order. With no setup or monthly fees it is an easy and low-risk way for restaurants to get online.

The Storage Bits take  I'm intrigued by the idea of a virtual currency. Currency can be a store of economic value, and I'm professionally interested in all the ways, means and reasons we store data and other cultural artifacts.

Modern national currencies are no longer backed by gold or silver. Instead their value derives from the fact that they are accepted for products and services nationally and in some cases, such as the American dollar, worldwide.

Since currency works because it is accepted as a social norm, virtual currencies can succeed if they too are widely accepted. It is primarily a social issue - building trust and acceptance - and not a function of owning Fort Knox.

As the Internet has destroyed the business models of so many intermediaries by directly connecting us, I don't see any reason that a digital or virtual currency could not be successful. It won't be easy, and we've no doubt got a lot to learn about them, but whether a currency is backed by a government or an online exchange matters much less than it used to.

That's possible through creative Internet intermediation. The fact that Bitcoins can buy food marks a small but important step in the evolution of an online currency: sellers accepting a virtual currency without even knowing it.

Comments welcome, of course. No fiat or virtual currency changed hands in the preparation of this post.