It was probably inevitable that a digital currency made its way to the world of retail, but is it going to stick?
According to a recent STORES article, BitPay, the service that allows customers to pay electronically with Bitcoins, has found a home in online purchases, and has even begun creeping into brick-and-mortar operations.
From the article:
Family-owned online retailer Bees Brothers began selling honey at local farmers’ markets and expanded its sales to include e-commerce. Owner Craig Huntzinger says PayPal was the only online payment option at first, but his teenage sons heard about Bitcoin and suggested that the family add it. The site began accepting Bitcoin in January 2012; Huntzinger estimates about 60 percent of business now comes via Bitcoin.
Adafruit.com, started in 2005 by an MIT engineer to provide a site where people could learn about and design electronic products, also sells tools and equipment used in high-tech design. Within the first few weeks of accepting Bitcoin, the site hit more than $100,000 in Bitcoin transactions, according to founder Limor Fried. The site also accepts PayPal and credit cards via Google Wallet.
Sales involving Bitcoin are typically for larger transactions — averaging about $200, Fried says. “Usually people are not excited by the form of payment they are using,” she says. “But with Bitcoin, it’s not only a currency, it’s a community.”
While merchants accepting Bitcoin are impressed by the lower fees and lack of chargebacks, consumers like not having to provide any information to the retailer other than what is required to ship the goods. International shoppers like not having to deal with currency conversions.
But that anonymity — and its potential abuse by criminals — is one of the reasons federal regulators and law enforcement authorities have looked closely at Bitcoin. The FBI last year seized 26,000 coins worth $3.6 million when it shut down Silk Road, a website accused of dealing in illegal drugs. The Treasury Department’s Financial Crimes Enforcement Network told a Senate committee in November it is working to keep digital currencies like Bitcoin from being used for illegal activities.
Bitcoin itself is anonymous, founded by an individual or group using the name Satoshi Nakamoto.