wow wonder if this is started by online retailers
EBay may open its wallet to the virtual currency Bitcoin.
The e-commerce heavyweight is exploring ways to integrate bitcoins into its PayPal payments network, Chief Executive John Donahoe said in an interview with The Wall Street Journal.
?It?s a new disruptive technology, so, yeah, we?re looking at Bitcoin closely,? Donahoe said. ?There may be ways to enable it inside PayPal.?
Integration into PayPal?s network would give Bitcoin some much-needed legitimacy. Accepted by few retailers, the currency is held mostly by speculators hoping to profit from price fluctuations, which have been particularly volatile in recent weeks.
Donahoe said eBay hasn?t yet made any commitments to use the currency.
He said Bitcoin was reminiscent of music sharing sites Kazaa and Napster, which were found to violate trademark rights, but helped spawn legitimate sites such Pandora and Spotify. ?Virtual currency is something that?s here to stay,? Donahoe said.
Within the next five years, Bitcoin or other virtual currencies, such as airline miles, could be converted to cash and used in retail, Donahoe said. Integrating such virtual currencies into its payment network would help eBay in its effort to push PayPal use at bricks-and-mortar retailers, rather than just online. PayPal brought in $1.55 billion in revenue for eBay in this year?s first quarter, an 18% jump from a year earlier.
Last month the U.S. Treasury Department said it will apply money-laundering rules to Bitcoin and other virtual currencies, meaning firms that issue or exchange the increasingly popular online cash will be regulated in a manner similar to traditional money-order providers.
Coinsetter, which will allow participants to trade bitcoins using borrowed money in the coming weeks, has attracted venture capital funding. And Western Union Co. and MoneyGram International Inc. are also studying ways to allow customers to transfer money around the globe using bitcoins.
For now, the currency is accepted on a few sites, such as Reddit and WordPress, as well as Pizzaforcoins.com, which allows users to pay for some pizza deliveries.
The currency is still volatile, making its prospects in retail sales risky. In April alone, bitcoins have ranged from $50.01 to $266, with an average of $114.94, according to bitcoincharts.com, one site tracking the currency?s value. The market for bitcoins is over $1 billion, according to the site.
Related reading: During his visit with the Journal, Donahoe also explained why eBay stands virtually alone among its peers in opposing a bill in Congress that would create a new national standard for charging state sales taxes on products bought online.
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