Bitcoin gives Overstock's bottom line a boost
Overstock's chief executive tells Reuters he expects the site to do $1 million in bitcoin sales per month by the end of this year.
Overstock's decision to introduce a bitcoin payment option earlier this year appears to be paying off.
Bitcoin sales have hit $2 million dollars since the e-marketplace started accepting the digital currency for payments in January, Chief Executive Patrick Byrne said in an interview with Reuters published on Thursday. While that's less than one percent of Overstock's total sales, Byrne expects bitcoin usage to accelerate on the site to $1 million in sales per month by the end of the year. So far, sales from the digital currency have totaled $300,000 a month, reported Reuters.
As bitcoin has become more accepted by mainstream retailers over the last year, it has also sparked debate. Lawmakers around the world have both railed against the autonomous digital currency, saying its a threat to governments which need to track and maintain currency value, and praised it as a technology that could improve commerce.
Bitcoin's chief advantage over standard payment options is that it creates a nearly anonymous transactional experience for customers and retailers. The technology is designed to protect peoples' identities and shroud who is buying a good or service.
Overstock was one of the first major retailers to accept bitcoin payments. The company uses Coinbase, a third-party payment processor, to handle the transactions. For retailers, the acceptance of bitcoin presents an important opportunity: lower transaction fees. Transaction fees for bitcoin payments are typically less than one percent, that's less than a third of most credit card transaction fee.
While Overstock, and other prominent retailers like NewEgg and Dell, have decided to accept bitcoin payments, Amazon has shunned the currency. Earlier this year, Amazon said that it had no interest in accepting bitcoin, adding that its customers have not said "that it's right for them."
Still, Overstock's success with bitcoin speaks to the popularity of the cryptocurrency and the way it's impacting commerce. Bitcoin had some troubles in the last year, most notably with the theft of 750,000 customer bitcoins from the Mt. Gox exchange, but it continues to have a strong conversion rate. As of this writing, a single bitcoin is worth $506.76.
CNET has contacted Overstock for additional comment on bitcoin. We will update this story when we have more information.