In late October, there was a brief mention of retailer Overstock.com in a New York Times piece that noted the online retailer was considering accepting bitcoin, but decided they would put a hold on that objective (partially due to the fact that bitcoin is still a ‘gray area’ in terms of financial law).
It would appear that Overstock is once again revving their engines on that front, with the company telling newsBTC that they plan to begin accepting bitcoin in the second half of 2014 — making them the first big retailer in the space to do so.
The announcement comes directly from Overstock.com CEO Patrick Byrne, who spoke to me briefly on Wednesday in an interview by phone. Byrne told me that the company is still working out the logistics of accepting the currency, but notes that they may plan to work independently of bitcoin payment processors like Coinbase or BitPay by implementing a proprietary system to manage the transactions. The bottom line: Overstock hasn’t decided yet. Byrne says Overstock will have no marginal cost in the implementation, so it’s something they’ll keep plugged in. If after a year or two Overstock sees minimal bitcoin purchases, that may be the time to pull that plug.
“Bitcoin is good money,” Byrne told me.
Many companies today accept bitcoin, but immediately convert it to fiat afterwards. Asked whether or not Overstock would take the same approach, Byrne indicated that if Overstock kept their bitcoin, they would need to find a market on which to hedge their risk.
“If we cannot find a way to hedge our risk, we’ll be converting right back into dollars,” Byrne said.
And with the price per bitcoin fluctuating wildly (particular this week in an unfortunate downward direction), would this turn Overstock.com off to accepting bitcoin?
“Not in the least,” says Byrne, reiterating that if Overstock can hedge their risk or have the option of converting into dollars, it won’t matter.
“Those kinds of fluctuations won’t matter in our plans,” he says.
This is a hugely important milestone in bitcoin history. An online retailer the magnitude of Overstock surely has the power to become the catalyst in widespread acceptance of the digital currency in the online marketplace, but Byrne noted that at the end of the day, it really all depends on how many users end up paying with bitcoin.
“It will put [Overstock] at a competitive edge if, and only if, the general population starts thinking and using bitcoin,” he said. “We’re willing to take the first step and see.”
Author note: A small correction was added in the section discussing 3rd-party bitcoin processors. newsBTC originally stated Overstock would not be working with 3rd-parties, but we have corrected this to reflect Mr. Byrne’s statement that the company is not yet certain of how the implementation will happen, exactly.