Friday, August 15, 2014

Has Bitcoin Fatigue Set In?

The price of Bitcoin is trending lower once again. It is just above $500, far from its distant all-time peak of  $1,082.00. Has Bitcoin fatigue set in on what appears to be a fad currency? Sydney Ember at NYT writes:
Overstock, which began taking Bitcoin as a form of payment in January, said that only about a quarter of a percent of its sales were in the virtual currency, or about $12,000 to $15,000 a day. With about $1.3 billion in total sales in 2013...

One reason Bitcoin transactions have not yet taken off, experts say, is that the virtual currency does not provide obvious benefits for customers. In many ways, it is still easier to pay with a credit card or a PayPal account than with Bitcoin, especially at retailers like coffee shops or grocery stores...

“My sense is that a few consumers try to use it as much as they can, but most consumers don’t find it nearly as convenient as using a credit card,” [said Steven Englander, a research analyst with Citigroup]...

Merchants like Overstock and Dell said they experienced an initial bump in activity on their sites after announcing they would accept Bitcoin, especially after they received media attention.

Now, however, some see signs that there may be a bit of Bitcoin fatigue. Sales at Overstock, for example, have fallen considerably since its first week of Bitcoin transactions, when it had about $500,000 worth, said Mr. Byrne, Overstock’s chief executive.

“There’s a corner of the market that wanted to use Bitcoin, and this was a chance to get that piece of the market before anyone else got to it,” Mr. Byrne said. “People who accept it now aren’t going to get nearly the publicity that we did.”

No comments:

Post a Comment