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Chips are down for currency has-beenz

17 August 2001  |  2340 views  |  0 money in bin_1

Beenz.com says it will refuse to honour transactions in its artifical Web currency beenz with effect from midnight, 25 August.

The UK-based Internet company is pulling the plug on an operation which raised £55 million at the height of the dotcom goldrush, enticing cash from high profile investors such as Oracle chief Larry Ellison and venture capitalist Apax partners.

At its peak, the company employed 260 staff in 13 offices around the world. It had five million registered members and 300 online merchants on its books. Users earned beenz for Web site transactions and could redeem them when purchasing at participating retailers.

Many of the retail outfits which accepted the currency were among the first wave of dotcom failures. With no new money for investment, Beenz began scaling back its operations late last year and formally put itself up for sale in March. The company says it is negotiating the sale of some of its intellectual assets and its technology platform with a number of interested parties. A skeleton staff of five employees will remain in New York as the business is wound down. The London office will close with the loss of 25 staff later this month.

A statement on the company's Web site reads: "The operation of the beenz economy will be terminated at 12:01 am (Eastern Standard Time - EST) on August 26, 2001. No beenz earning or spending transactions will be honored after that date and time. Any beenz remaining in a Member's account after 12:01 am (EST) on August 26, 2001 will be invalidated by beenz.com, and the Member will not be entitled to any compensation of any kind for such invalidated beenz."

Beenz demise would seem to spell the end of a dotcom dream to create a virtual currency capable of gaining widespread acceptance in the Internet economy. Flooz.com, a New York-based company which operates an alternative online currency which users buy for hard cash, last week announed that it too had suspended operations while it seeks a merger partner.

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