E-commerce giant Rakuten announced this week that they now accept bitcoin for all purchases on their United States based websites, which include Buy.com. Just a few days after the announcement, they also enabled bitcoin payments on their German and Austrian sites. The really big news will be when Rakuten opens up bitcoin payments on their Japanese site.
Rakuten will use upstart bitcoin payments processor Bitnet, which was founded by former Visa execs and raised a $14.5 million Series A funding round last October (Rakuten is an investor in the company as well). Signing such a major client could help Bitnet rise the ranks as a competitor to companies like BitPay and Coinbase.
Late last month, Rakuten CEO Hiroshi Mikitani said at a conference in Tokyo that his company was “thinking about” and “would probably accept” bitcoin payments in the future, but I was surprised with how quickly it actually materialized. With more than $5bn in annual revenue, Rakuten is the eighth-largest internet company in the world, and now among the largest companies to accept bitcoin.
“Evo Market,” as it was known, was apparently the largest and most popular darknet market in the wake of Silk Road (and then the second Silk Road) being shut down by authorities. This week, users of the site were burned to the tune of at least $12 million, when the anonymous (or not?) operators of the site decided to “exit scam” their users — they pulled the plug on the site and kept the tens of thousands of bitcoins held in escrow and in user accounts. The Guardian has more.
A lot of people got burned and were shocked at this turn of events, but it should be a no-brainer that handing control of your bitcoins to anonymous black market operators is playing with fire. The concept extends to other centralized services as well, with countless bitcoin sites having either lost or stolen customer funds over the years. This would be a good place to hammer home the point that if you don’t control your private keys, your bitcoins are not really yours. Multi-signature bitcoin technology will eventually make such events technologically impossible, but the sites that have currently implemented it are few.
+ Another bitcoin service, Coinapult, was hacked to the tune of 150 BTC this week.
In their annual 10-K filing with the SEC, Overstock revealed that they have purchased a 24.9% stake in a registered broker-dealer, “as part of our efforts to develop and license software to trade cryptosecurities using the Bitcoin network and its protocols.”
+ Probably part of Overstock’s decentralized stock-exchange project, Medici. Going from an online retailer to taking on Wall Street is quite a pivot!
Mastercard’s 10-K repeatedly cites cryptocurrency as a potential future competitor. (“Rapid and significant technological changes could occur, resulting in new and innovative payment methods (including cryptocurrencies) and programs that could place us at a competitive disadvantage and that could reduce the use of MasterCard products.”)
San Francisco-based Bitreserve announced a partnership with Mexican billionaire Ricardo Salinas-Pliego, possibly to make some kind of entry into the Mexican remittance market. Bitreserve was launched by CNET founder Halsey Minor just four months ago. In that time, they claim that their reserves have grown by more than 1000%. Here’s a really cool page they put up to visualize some data from the site.
Credit-Suisse published this brief on bitcoin which concludes, “bitcoin has a future in certain areas and countries.”
The UK government has announced that it will begin regulating bitcoin exchanges, and at the same time has pledged 10 million GBP to fund research on digital currencies.
+ Her Majesty’s Treasury published this report on the benefits and risks of digital currencies. The paper’s conclusion begins by saying, “The government is committed to increasing banking competition in the interests of all customers. Encouraging greater innovation in payments, which provide the plumbing for the banking sector, is central to this. The government intends to create a world-leading environment for the development of innovative payments and financial technology.”
BITS & PIECES
Amazon Prime users can now stream The Rise and Rise of Bitcoin documentary for free.
In an apparent landlord dispute, the World Bitcoin Association, which runs the New York Bitcoin Center, filed for bankruptcy this week. The center, which remains open during this dispute, is located just one block off of Wall St. and is right next to the New York Stock Exchange.
The Victorian government in Australia is to sell 24,500 bitcoins seized from a Silk Road vendor. As far as I know, this makes Victoria the second government to sell bitcoins.
Intel catches up with IBM and looks to hire a researcher to investigate blockchain tech.