FanDistro, a marketing platform that rewards fans and charities for selling music and merch, has become the first music marketing service to accept controversial alternative currency and payment system Bitcoins. The move not only puts FanDistro and the artists they service at the forefront of an increasingly popular trend, but lowers transaction costs to zero.
The Connecticut based startup also just landed $700,000 in Angel funding. FanDistro's previous round was $450,000 in August of 2011.
Growing in popularity and acceptance daily, Bitcoin is a peer-to-peer payment system and digital currency introduced as open source software in 2009 by developer Satoshi Nakamoto, according to Wikipedia.
All normal credit card transaction fees are eliminated using Bitcoin; and an agreement with San Francisco based Bitcoin exchange Coinbase means artists will not have to worry about wide shifts in the value of Bitcoin. "The artist will not be exposed to any exchange risk whatsoever," founder Micahel Penfield, who was an investment banker for Merrill Lynch and other firms before launching FanDistro. told Billboard.
"Musicians are a funny bunch," Penfield said. "We embrace our independence. Thatâs what attracted me to bitcoins. Youâre independent of government currency manipulation, bank fees and regulations."