EBay is in talks to begin accepting Bitcoin as a payment method. Despite having swayed Dell, Dish and Expedia in recent months, eBay will be Bitcoin's largest supporter to date if the deal goes through.
If talks go smoothly, Bitcoin transactions will be allowed on Braintree, which is a payment processor owned by eBay and part of PayPal.
Not only might users eventually be able to pay for eBay purchases using Bitcoin, but they will also be able to pay for other services like restaurant reservations through OpenTable and car rides through Uber.
This is good news for Bitcoin after Bitcoin exchange program Mt. Gox declared bankruptcy when almost 750,000 Bitcoins were stolen. Following this, a U.S. senator called for a ban on Bitcoin saying that it was "highly unstable and disruptive to our economy." In fact, Bitcoin has been plagued with problems. At its highest point last year, Bitcoins were sold for over $1000. Today they're sold for around half of that.
"Virtual currencies are not backed by any government or central bank," said the U.S. Consumer Financial Protection Bureau. "And at this point consumers are stepping into the Wild West when they engage in the market."
Despite the caution by many surrounding Bitcoin, businesses like eBay could help boost the payment service and give it more legitimacy. Bitcoin has begun making deals with other online companies to help this legitimacy, most notably Overstock, Newegg and Dell. Also, because of the fact that Bitcoin ownership and transactions are recorded, supporters believe that it is a much safer currency than other online currencies.
Overstock is one of the largest retailers that accepts Bitcoin after the shopping website made a deal with Coinbase earlier this year. Overstock reported it expects sales using the crypto currency to be between $6 million and $8 million this year, with an average of $1 million per month by the end of the year.
Braintree was acquired by eBay last year for $800 million in an attempt to help boost PayPal's mobile presence. Braintree is the payment provider for a number of online services like Airbnb, Basecamp and Hotel Tonight. Braintree was reportedly handling over $12 billion in payments when it was bought by eBay.
It is unclear which company Braintree will use to handle Bitcoin payments, but it will likely be Coinbase. Even if a deal is reached, Bitcoin payments would not be supported on eBay.com and PayPal straight away. They will, however, be supported on other Braintree powered services. Eventually eBay.com and PayPal could support the service.
"We do believe that Bitcoin will play an important role in payments in the future but we have nothing to announce," said Jennifer Hakes, an eBay spokesperson.
