Online discount retailer Overstock.com intends to start accepting Bitcoin as payment for goods beginning June if everything goes according to plan, The New York Times Bits reported. Overstock Chief Executive Patrick Byrne said the company is now reviewing the services provided by various third party firms that process transactions done in Bitcoin and plan to choose one by the middle of January next year.
The report said should Overstock will proceed with its plan, it will become the most famous retailer to allow payment in the digital currency. Bitcoin was initially known as a form of payment in the black market for drugs and weapons and as the new obsession for currency speculators.
Bitcoin has gripped the imagination of technology entrepreneurs and investors who looked at the digital currency as a low-cost payment system that could compete with traditional credit card players like Visa and MasterCard, the report said. However, although investors have formed or funded startups to give various types of Bitcoin services, not a lot of prominent retailers directly accept the digital currency.
According to the report, Byrne's decision to accept the currency is fueled not by business reasons but by philosophical ones. In a voice mail message detailing his plans, Byrne said a tiny fraction of the population wanted to use the Bitcoin in their transactions. However, what he finds appealing is the limitations of Bitcoins. He also seems intrigued at the ideal of a digital currency that is not controlled by government.
Byrne said, "You want money to be based on something that no government mandarin can wish into existence with the stroke of a pen."
Byrne said Overstock was already mulling about embracing the digital currency as early as October but regulatory uncertainty about the digital currency caused them to suspend their plans. To protect itself against fluctuations of Bitcoin's value, Byrne said it would use derivatives as hedge. He said another form of protection is for Overstock to simply turn its Bitcoins to dollars each night.
Join the Conversation