OpenCoin Buys Simple Honey to Make Digital Money User-Friendly

OpenCoin Inc. has acquired Simple Honey Inc., an ecommerce system based on "wish list" shopping.

OpenCoin is building and testing the Ripple protocol, which supports a new virtual currency and payment network. The platform will also complement Bitcoin, an incresingly popular digital currency.

"We thought it was really important, as we're preparing for the major launch, to bring on really great user-experience people that can help design a great user experience with super-simple tools … and focus on the needs of the user to get maximum use," says Chris Larsen, CEO of OpenCoin.

Virtual currencies are often much less accessible than mainstream dollars and credit cards. Despite Bitcoin's prominence, it relies largely on tech-savvy "miners" to introduce bitcoins into circulation and validate their use. Other efforts have been undertaken to make the digital currency easier to use, such as BitInstant's planned debit card.

San Francisico, Calif.-based Simple Honey came to market in May 2012 with a tool for recommending hotels based on a user's personality. At the beginning of this year, the company shifted its model, creating a travel and shopping application called "I Want Wish Lists." This product allows users to create lists of items they want to buy, and the app tells them the right time and place to buy each product.

At OpenCoin, Simple Honey's four-person team will focus on making the Ripple network and the virtual currencies used in the network understandable and easy to use. Simple Honey's employees include Eric Nakagawa, a web developer, and Joyce Kim, a former corporate attorney and CEO of soompi.com.

With these new additions, "the network is going to become not just a project, but what we all hope it will become, which is a lower-cost [and] more open access way of making payments," Larsen says. The acquisition "was really about the talent within the company around usability … to explain something complicated in a simple way."

The Simple Honey team joins Larsen, known for shaking up the consumer finance market in the 1990s and 2000s with E-Loan and Prosper. In those ventures, Larsen grappled with fast-evolving regulatory requirements — experience he plans to use as virtual-currency companies catch the attention of regulators.

OpenCoin's team also includes Jed McCaleb, who founded the Mt. Gox Bitcoin exchange, and Stefan Thomas, who created the Bitcoin project library BitcoinJS.

"When the opportunity presented itself to merge simplehoney's talents into one of the fastest growing movements in tech, we couldn't say no," says Joyce Kim in a blog post. "We believe that the world economy is on the cusp of a major evolution, and we want to make it easy for anyone, anywhere to be a part of that change through Ripple."