[saint_fiasco]

In my country most cell phones are on pre-paid plan. You can buy cell phone credits at a gas station, then that credit gets used up as you make calls and send messages.

When the cell phone companies came up with a service to transfer cell phone credits to other users, people started using that as currency. Only problem is each company runs its own proprietary system and there is no way to send credit to a someone who uses a different cell phone company.

If you think about it, phone companies have the best micro-transaction infrastructure on the planet. They are constantly charging people fractions of a penny per second per phone call.

[rthomas6]

In a few countries like Kenya and Tanzania, this concept is already in use and is extremely widespread. A LOT of people use this system instead of having a bank account. They even use it to pay bills and buy things at stores.

https://en.wikipedia.org/wiki/M-Pesa

[loblollyboy]

Yeah - but they're not talking about mobile money - they're talking about bitcoin.

[jpatokal]

Yes, but unlike bitcoin, M-Pesa is actually used by average people.

[GFischer]

I actually tried starting a company based on that, but when I went to talk to the cell phone providers, one of them candidly explained to them that SMS was their cash cow and that it was essentially free for them, and calls were very cheap related to what the person paid, so it makes no sense for them to enable people to use the credit for other stuff which might get them into trouble later - think lawsuits, regulations, and all the complications of becoming a payment provider.