The big news over the weekend was that American online retailer Overstock.com would begin accepting Bitcoin sometime in the spring of 2014. This is a company that saw more than $1 billion in revenue last year.
If/when this happens, it would make Overstock the largest American retailer to accept Bitcoins. Dating site OkCupid and domain service Namecheap recently began accepting Bitcoin payment, but getting a big retailer on board would really push the digital currency toward the mainstream.
This announcement comes a couple of weeks after the People’s Bank of China issued warnings that neither financial institutions nor payment companies could process Bitcoin or work with Bitcoin exchanges. Notably, Taobao, the popular online marketplace in China, removed Bitcoin payments after the central bank’s announcement.
So, perhaps this means American companies have an opportunity to fill in this massive gap in the Bitcoin marketplace.
But Overstock CEO Patrick Byrne is thinking bigger than that.
“In an ideal world, we’d go back to gold so you’d have a monetary system based on something that government mandarins can’t expand at the stroke of a pen,” Byrne said. “We’re not going to go back to gold, but Bitcoin shares that virtue. It is mathematically if not physically constrained.”
Note, however, that Overstock is a publically traded company, and Byrne has a legal fiduciary responsibility to manage shareholder risk. No one is yet sure how Bitcoin fits into that responsibility.
Complicating things is the fact that the IRS has not provided much guidance as to how it would treat digital currencies or profits generated from them. In short, Overstock has a number of hurdles before it can begin to accept Bitcoin payment.
But again, if/when it does, it could be a game changer.