Mike Tyson Bitcoin ATM Provider Addresses “Potential Scam”

On Saturday morning the Bitcoin community was treated to a tweet from Mike Tyson’s verified twitter account. "Coming soon… http://Miketysonbitcoin.com … Changing the way we get change."

Following his link takes you to a single page titled "MIKE TYSON BITCOIN ATM – COMING AUGUST 2015." Just above the subscription box users are asked to "JOIN THE BITCOIN REVOLUTION WITH THE MIKE TYSON BITCOIN ATM."

"MIKE TYSON’S FASTEST KNOCK OUT IN THE RING WAS 30 SECONDS. THE MIKE TYSON BITCOIN ATM CAN TURN YOUR CASH INTO BITCOIN IN UNDER 20 SECONDS."
— – Miketysonbitcoin

This marks the first time a celebrity has put their name on a Bitcoin product. There have been previous occasions when celebrities have publicly shown their support of the new technology. Ashton Kutcher is well know for investing in BitGo, a bitcoin security platform that operates an online wallet for individual, while Mel B and Snoop Lion, formerly Snoop Dogg, sell their own existing products while accepting bitcoin payments.  However, never before has a celebrity put their own name on a product in the Bitcoin market, nor put their own marketing team to work pushing bitcoin in any significant way.

A Las Vegas mainstay, Tyson has focused on his acting career in recent years and has 29 acting credits under his belt, including the blockbuster Hangover series starring A-list actors Bradley Cooper and Zach Galifianakis. Sin city is already out in front of the Bitcoin adoption curve, according to Coin ATM Radar,  with at least one casino having a Bitcoin ATM installed in its lobby, and a total of Eight Bitcoin ATMs around the city. Rumors have also placed a Ninth machine in the Luxor. Last October a Bitcoin conference called CoinAgenda was held in Tyson’s hometown. One of the locations for an “offsite cocktail party” was at Tyson’s former home, although it is unclear if he was there that night.

The new Mike Tyson ATM website gives little information about the legal structure nor ownership behind this enterprise, except the business name Bitcoin Direct, LLC. The domain name Miketysonbitcoin.com is registered to Peter Klamka in Ann Arbor, Michigan. Klamka is the CEO of several businesses, both inside and out of the Bitcoin industry. His companies include at least one formerly publicly-traded company, Cephas, which was later renamed Bitcoin Brands, Inc. and used primarily for Bitcoin ATM machine sales.

The confusion in ownership is most likely what led to the article this morning by Duncan Riley of SiliconAngle. The “exclusive” article states “Mike Tyson suckered into endorsing branded Bitcoin ATMs,” and describes the deal as a “potential scam.” The accusation was picked up by the International Business Times, and the Bitcoin community has been abuzz with talk about the controversy surrounding this arrangement ever since.

Brave New Coin reached out to Mr. Klamka in order to set the record straight. “The Mike Tyson business is conducted through BitcoinDirect, LLC.” Klamka stated.

“It has nothing to do with Bitcoin Brands Inc. Separate owner’s, separate capital structure. They are even incorporated in different states…Bitcoin Brands in Delaware and Bitcoin Direct, LLC in Nevada.”
— – Peter Klamka

It is not uncommon in the business world for one entrepreneurial person to have more than one project, company, or corporation running at the same time. Having multiple, legal  business entities protects one from the debt of another in hard times.

The meat of Riley’s article had to do with the public price of Cephas’ now-discontinued stock. If Cephas was indeed the same corporation as Bitcoin Direct LLC, then any debt would likely be a factor in Mike Tyson’s engagement with Klamka. According to Klamka Bitcoin Direct LLC was recently created just for this deal with Tyson.

“[Bitcoin Direct LLC has] no debt, and was formed on my initiative to do celebrity branded bitcoin deals. The only common thread is that I have ownership in both. Bitcoin Brands (Cephas) is no longer public due to our request to go private.”
— – Klamka

Bitcoin Brands Inc. still owns five Bitcoin ATMs across the United States today, none of which are attached to the Tyson project. Based out of Ann Arbor, Michigan, Klamka already has at least one Bitcoin ATM running in Las Vegas, installed in the popular Mixed Martial Arts gym, One Kick Nick’s. Most of his existing Bitcoin ATM machines are from General Bytes, including the Las Vegas machine and one deployed in Manhattan. Klamka also has experience with several BitAccess BTM kiosks that were originally deployed in Montreal and Michigan, although these have since all been moved or sold.

“I operate regular ATMs in New York, Montreal, Las Vegas and for a time Michigan but no longer. I have 4 General Bytes and a BitAccess operating now. The Michigan change was only due to a change in local personnel and shift in location.”
— – Klamka

Klamka has a another Bitcoin-centric business website under the ownership of Bitcoin Brands, LLC, a storefront for Bitcoin ATM machine sales called the Bitcoin Vending Network, which appears to sell completed Skyhook vending machines among other models.

Another branch of Bitcoin Brands is BitMD, which targets Medical Marijuana Dispensaries specifically, offering them Bitcoin payment options, point-of-sale terminals and a customized payment module for dispensaries. Earlier this year Klamka mixed the two business interests, installing a Skyhook vending machine in a Medical Marijuana Dispensary in Grand Rapids, Michigan.

Another branch of Bitcoin Brands is a startup accelerator, offering up to $25,000 to Bitcoin entrepreneurs with promising business plans, preferably located in New York City. With all these businesses Klamka has certainly been keeping busy in the Bitcoin space, and now he is focusing all of his time and energy on distributing and supporting Mike Tyson ATMs. “I have been spending a great deal of time on the Tyson machines.”

Although Klamka has previous experience as a boxing promoter, he never met the former Heavyweight Champion of the world until he approached Tyson for this deal.

“I simply made a list of who I think would do the most business for my idea of a celebrity bitcoin ATM… Mike has a global appeal and reaches a generation that watched him when he fought as well as a younger demographic who saw the Hangover or who see him ringside at the UFC or who see his brand of Tshirts. I pitched him and after a few weeks we were able to strike a great deal that is good for us and good for raising the awareness of bitcoin.”
— – Klamka

Approaching celebrities for a business deal can be notoriously difficult to do, but Klamka was no amateur in the game. “I’ve done celebrity payment deals before,” he told BraveNewCoin. Another former business, which Klamka ran a decade ago, Legend Credit signed up at least three different celebrities for their own branded Visa Gift cards. The legendary rock band Kiss, Disney star and pop icon Hilary Duff, and Hello Kitty via its owner Sanrio have all had their own Visa Gift cards thanks to deals that Klamka struck.

Although he has extensive experience with the other brands of ATM machine mentioned here, for this new line of Bitcoin ATM machines Klamka chose to use customized Lamassu BTMs.

“The Tyson machines are based on (but highly customized) Lamassu machines. In short, their stand allowed for the greatest customizing… The start up screen is also customized. Lamassu also gave us a flexibility as some locations won’t need a stand due to placement issues.”
— – Klamka

His rollout schedule will start in Las Vegas next month, adding more locations across the US. “We have two Tysons going into service in high visibility locations in Las Vegas in August. We will add 3 more Tysons in Las Vegas and New Jersey in September. I am hopeful we have 50 Tysons operating in the next 12 months in the US.  We are also exploring Asian distribution but no firm locations yet.”

With so many new Bitcoin ATM machines going in across the nation, they are sure to be noticed by the mainstream media and perhaps even become the dominant brand of Bitcoin ATM machine here.

It is conceivable that well-branded and celebrity-endorsed bitcoin ATM machines might out-compete existing machines like the underlying Lamassu, Robocoin, and BitAccess lines. No matter what happens to the Bitcoin ATM industry, if this trend develops it will mean more publicity for Bitcoin and more access to buying and selling bitcoins in person.