Overstock.com Plans To Accept Bitcoin

SonicSpike writes "Overstock plans to become the first big U.S. online retailer to accept Bitcoin, as Patrick Byrne, the company's libertarian chief executive, warms to the virtual currency as a refuge from government control. Mr Byrne told the Financial Times that Overstock planned to start accepting Bitcoin next year – possibly by the end of the second quarter – a decision that he said was driven mainly by his own political philosophy. 'I think a healthy monetary system at the end of the day isn't an upside down pyramid based on the whim of a government official, but is based on something that they can't control,' Mr Byrne said."

Comments

Guesses as to end effect?

[SuperKendall]

It will be really interesting if this creates any stability in the value of bitcoin, or if not how pricing will work with something that can fluctuate in value so wildly... will the company convert BTC to cash right away, or will it keep it for a while before conversion (if ever)?

Re:Guesses as to end effect?

[rudy_wayne]

.

I think a healthy monetary system . . . . is based on something that they can't control

As fashionable as it is to be anti-government or anti-establishment, or Let's Stick It to "The Man", a monetary system not under government control is not the answer and Mr. Byrne is full of Libertarian bullshit. The recent article "Why I want Bitcoin to die in a fire" says it perfectly. Our current monetary system sucks, but replacing it with Bitcoin would be even worse.

Yesterday I went to a store and bought some items. Today I went back to that store and everything was still the same price, and the dollars in my wallet were still worth exactly the same as they were yesterday, and the day before, and the week before and the month before. An unstable currency that changes value from one minute to the next is an unworkable mess.

Re:Guesses as to end effect?

[Anonymous Coward]

Same way they do at the moment. All BTC conversions would be subject to a known conversion rate to USD and tax would be charged as appropriate, i.e. so long as AMZN feel it is in their best interests to do so.

Re:Guesses as to end effect?

[mishehu]

Why yes, that's an even better idea. Let's all have the gov't hoard all sorts of gold that could actually be used for something useful instead... You'd love for your graphics card to triple in price because now the gold for the contacts and other components is all scarce now, wouldn't you? A gold standard has a big downfall in common with BTC... it's naturally deflationary. A modest rate of inflation is not necessarily a bad thing, but having to go from paying 1/4 of your net income on your mortgage now to 1/2 of your net income in 15 years doesn't sound so hot either does it?

Re:Guesses as to end effect?

[xQx]

Parent should be modded up.

Also, what is this "plans to accept" BS. There are heaps of online retailers who take bitcoin, and if they were serious they would have just used someone like coinjar.io to do the merchant service for them and convert it back to USD on the fly.

Slashdot - stuff that matters.... It will be news when Overstock.com ACCEPT bitcoin, not when they do nothing more than release a press release that they PLAN TO ACCEPT bitcoin some day in the future.

Thanks Slashdot for your thinly veiled Christmas advertising. Anyone wanna buy some Viagra?

Re:Guesses as to end effect?

[Patch86]

Yeah, because the value of gold is totally stable:
http://www.bullionvault.com/gold-price-chart.do

There's a reason why every country in the world abandoned gold/silver/commodity linked currencies, and it wasn't because of a global conspiracy- it was because they were a disaster.

Re:Guesses as to end effect?

[Patch86]

The inflation rate in the US is what, 2% per year? 3%? 4? And when was the last time it suffered serious deflation? The difference in value between what I can buy in a shop today and what I can buy in a shop in one month is likely to be a fraction of a percentage point different.

Whereas Bitcoin has inflated by literally thousands of percentage points over the last year, has recently deflated by about 200% in the last MONTH, and regularly moves 10% or more on a DAILY basis. I have literally no idea whether a Bitcoin in my metaphorical pocket will buy me 10x more or 10x less goods by value next month compared to this month. Unless that situation changes, that is simply not a workable situation. As a sort of grand online casino game Bitcoin is great, but as a currency it is an unworkable disaster.

Re:Guesses as to end effect?

[serviscope_minor]

I think that a very large retailer like that one takes a while to integrate a new payment system. They might also wish to do the trading themselves to avoid paying the fees to the other operators.

But anyway it does show that that the profile of bitcoin is going up.

Time to short OSTK

[Anonymous Coward]

Perfect timing! I'm always in need of new stock market ideas! Thanks Overstock.com...you made my day!

Re:Time to short OSTK

[Trepidity]

It's also weird to oppose it if you're a libertarian, as Byrne claims to be. A "naked short" is just a contract written against a stock. Why should the government interfere to prevent people from writing such contracts? Requiring that short sellers have the underlying security as "cover" is just a government regulation.

Overstock.com still exists?

[Anonymous Coward]

Overstock.com still exists?..... Oooooh I see what they did there.

This press release brought to you by O.co, just a few days before Christmas!

Upside-down pyramids

[NoNonAlphaCharsHere]

Yikes. What this guy knows about monetary policy and central banking is - staggering. While national backing-free fiat currency may not be the most desirable way to do things, multiple entities issuing highly volatile (think internet speeds) banknotes of dubious value (CPU cycles? really?) is an insane step in the wrong direction.

But how much will it cost?

[Animats]

But will it be cheaper or more expensive than using a credit card?

Accepting Bitcoins is surprisingly expensive. There's a volatility risk, and for a currency that can change by 10% in minutes, that's a real problem. Coinbase (which is a dealer, rather than an exchange) has a posted buying price, good for one minute, and some shopping cart systems use that. But that price is usually lower than the prices on the major exchanges; there's a conversion cost. So, as with retail money-changers, you pay a conversion fee. Also, like most money-changers, Coinbase will briefly stop buying during periods of high volatility or if they have trouble unloading their Bitcoins.

Then, of course, there's prying the money out of the Bitcoin broker or exchange. Overstock is probably in a strong enough position to demand a daily sweep into a real bank account, with serious penalties for failure to deliver.

If you look at the few Bitcoin-accepting businesses that sell real products with typical mail order retail markups, the Bitcoin price is usually significantly higher than the US$ price. Most of the stores that currently accept Bitcoin are selling T-shirts, posters, remaindered goods, and similar crap. Of course, that's what Overstock does, so it may be a good fit.

Re:But how much will it cost?

[rudy_wayne]

But will it be cheaper or more expensive than using a credit card?

Accepting Bitcoins is surprisingly expensive. There's a volatility risk, and for a currency that can change by 10% in minutes, that's a real problem. Coinbase (which is a dealer, rather than an exchange) has a posted buying price, good for one minute, and some shopping cart systems use that. But that price is usually lower than the prices on the major exchanges; there's a conversion cost. So, as with retail money-changers, you pay a conversion fee. Also, like most money-changers, Coinbase will briefly stop buying during periods of high volatility or if they have trouble unloading their Bitcoins.

And there's the problem. Bitcoins aren't real money. Before you can spend them you have to convert them into something (dollars, euros, whatever). Meanwhile, the paper in my wallet doesn't need any conversion.

Re:The Slashdot of the past...

[DogDude]

The Slashdot of 1997-2002 would have loved Bitcoin. The Slashdot of 2013 hates it for some reason. I wonder what changed?

That's easy. Most of the Slashdot crowd has grown up.