Guzheng teacher Zou Lunlun accepts bitcoin in snub to banks and PayPal
Tired of bank and PayPal charges, music teacher Zou Lunlun has embraced bitcoin to accept payment from students worldwide
The cost of international banking for one small Hong Kong business has become so high that it has turned to the crypto-currency bitcoin for help in a snub to the financial system.
Zou Lunlun, founder of the International Academy for Musical Arts (IAMA) in North Point, is the first business to accept and receive bitcoins as an alternative payment method for her online music lessons. She introduced the service in September.
"I’m based in Hong Kong, but I teach internationally,” said Zou, who plays guzheng, or Chinese harp. “In the beginning, banking was done through banks, but they have big fees. After that, there were other platforms like PayPal, which became more convenient.”
When Zou, who has taught the instrument for 20 years, started conducting lessons on Skype for clients as far afield as Wellington, Vancouver and San Francisco, she found that extra banking fees could cost up to HK$330 – one-quarter of the tuition fee.
PayPal, as an alternative to banks, still asks senders to pay a series of charges, making the cost of sending payments equally expensive and unpredictable.
A 3.4 per cent fee is applied to the total money sent on credit cards, in addition to currency exchange and money transfer tax depending on what country the sender is from.
There are no such costs with bitcoin – although its volatility can make trading tricky – and Zou offers a 10 per cent discount to customers who use it. Now, 30 per cent of her international clients use the virtual currency.
"From a shell, a feather and coins to silver, copper and gold, all the way to dollar bills, credit cards and now bitcoin – it’s an evolution of great technology to make payments,” Zou said.
She charges as much as HK$1,200 per lesson, and teaches beginners to those at intermediate level.
Now in her late 30s, she is a fourth-generation guzheng player in a family of musicians. The guzheng, which originated during the Warring States period, came into prominence during the Qin dynasty, and its popularity survived the turbulent Cultural Revolution and on to present day.
Zou has travelled the world performing in front of audiences at the Sydney Opera House and the Vienna State Opera.
She has played for celebrities and politicians who include the former prime ministers of Australia and New Zealand, and former Chinese president Jiang Zemin.
Zou discovered bitcoin in 2009 after reading a magazine article and knew it would be “big”.
“As a traditional Chinese music professor, teaching the whole world while at the same time accepting new technology for the internet is a big step forward,” Zou said.
On September 4 this year, when she started to accept bitcoins – the price was only US$129 (HK$1,000), a fraction of the US$679 current price on the US-dollar-traded Bitstamp exchange.
Zou has amassed a hoard of 100 coins, now worth HK$493,100 – riding the bitcoin bull run.
Despite the recent price crash which started on December 5 after the mainland’s central bank intervened in speculative digital currencies, Zou has retained her share of coins, which were once worth more than HK$900,000.
Bitcoin has faced a barrage of criticism since its inception as an unreliable payment offering. With the volatility in the price, retailers faces difficulties in updating the price of its goods in bitcoins – and then storing them, not knowing if the next price move will be favourable or not.