Bitcoin aiming for mass adoption among retailers and FIs

bitcoin

There’s no doubt that interest in Bitcoin is still riding high right now. But there is also plenty of confusion and uncertainty about the digital currency, from its mysterious origins to its role as an alternative to mainstream currencies. It seems that retailers are beginning to warm to the idea of accepting bitcoin as a payments option. Whilst this may not be the case with major retailers such as Alibaba, there is evidence to suggest we could see more adoption among retailers in 2014.

Back in 2009, Bitcoin was valued at just less than a penny, but by the summer of 2011 that had risen USD30, before crashing down to USD3. It then slowly rose up to USD20 in mid-2012. Then in 2013 the currency began to surge, hitting a high of more than USD200 on April 9. It now stands as USD827 to date. This rise in value can not be ignored and it seems retailers are waking up.

We take a look at some of the wins and losses for Bitcoin over the past year:

Overstock.com accepts Bitcoin

Overstock.com, Inc. is now accepting Bitcoin as a form of payment on its online shopping site. Once items are selected and placed in the customer’s shopping cart, Bitcoin is a payment choice along with VisaMasterCard and PayPal.

“This is historic. Digital currency will be an important part of the future and Overstock is excited to be the first major online shopping retailer to accept it,” states Overstock.com Chairman and CEO Patrick M. Byrne. “As one who believes in limited government, this attracts me because it is a form of money that no government mandarin can will it into existence.”

Cypriot University accepts Bitcoin

The University of Nicosia, the largest private university in Cyprus and one of the largest English language universities in the Euro-Mediterranean region is now accepting Bitcoin for payment of tuition and other fees, making it the first accredited university in the world to accept the increasingly popular digital currency.

“While digital currency is a relatively new concept, currency is one of the oldest human inventions,” said Dr. Andreas Polemitis, Senior Vice Rector at the University of Nicosia. “What we aim to explore in this program is the likely development pathway of digital currency and give our students insights that they can bring to bear in their professional careers.”

Alibaba ban Bitcoin

Chinese e-commerce provider Alibaba has banned bitcoin-related products and payments from its online shopping websites. The decision is in light of two anti-bitcoin initiatives put forward by the Chinese government.

Alibaba’s Taobao, an eBay-like platform connecting individual buyers to small-time merchants previously allowed merchants to accept bitcoin as payment. But those transactions will no longer be allowed.

Political setbacks

Norway has said that the virtual currency Bitcoin is not real money. The country will instead treat Bitcoins as an asset and charge a capital gains tax.

Hans Christian Holte, director general of taxation in Norway, said: “bitcoin don’t fall under the usual definition of money or currency. We’ve done some assessments on what’s the right and sound way to handle this in the tax system.”

China has banned bitcoin because the currency has no real meaning; they have also banned financial institutions from handling bitcoin transactions.

“The concern is that it interferes with normal monetary policy operation,” Hao Hong, head of China research at Hong Kong’s Bocom International Holdings, said: “It represents an unofficial leakage to the current monetary system and trades globally. It is difficult to regulate and could be used for money laundering.” 

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