It’s been an exciting week for the Bitcoin community with the Silk Road auction completion (and the anonymous bidder revealed as Tim Draper, see below.) The market value for BTC jumped from around $600 on Sunday, before the announcement, to over $650 today.
California has repealed language from state law that could have been an obstacle to legal bitcoin use in the state. Newegg.com and 1-800-Flowers.com both have joined the Bitcoin bandwagon and will offer merchandise for digital currency. The folks at MyCoinSolutions talk Bitcoin adoption and education when it comes to bringing more businesses on board.
And today we learned that Venture capitalist Tim Draper won the $19.6 million worth of Silk Road bitcoins being auctioned off by the US Marshals Service.
California makes way for legal Bitcoin transactions
In case you missed it, California law has been updated to remove language from the corporate code that prohibited the use of anything but U.S. currency in commerce transactions.
The bill, Assembly Bill 129, was submitted by Assemblyman Roger Dickinson and signed into law by California Gov. Jerry Brown. It repeals Section 107 of the Corporations Code.
By repealing that code, California allows that digital currencies and cryptocurrencies (such as Bitcoin and Doge) can be legally used as alternatives to money. Since, as Assemblyman Dickinson also notes, Amazon Coins and Starbucks Stars are already examples of commonplace digital currency use California needed to prepare for the oncoming tide by not being in the way.
This decision has also led to at least one business citing it as increasing trust in bitcoin (see below) and reducing regulatory concerns.
NewEgg.com and 1-800-Flowers.com begin accepting Bitcoin
The continuing rivalry between Bitcoin payment processors BitPay and Coinbase has jumped up a notch this week with two well-timed announcements. Electronic e-retailer Newegg has partnered with BitPay to bring bitcoin payments to its customers; and almost on the heels of that announcement 1-800-Flowers.com announced a partnership with Coinbase for the same.
In a blog post, Newegg’s CMO Soren Mills said that the company chose to go with bitcoin as a way of “responding to our customers’ diverse needs.” Citing that BitPay’s implementation was seamless and would work to give Newegg further opportunities for high volume e-commerce.
The blog post also mentions that Newegg is responding to customer desires, noting that many Newegg customers are also early adopters of Bitcoin and other cryptocurrencies. The blog post also comments on California’s change to corporate law (see above) that paves the way for legal commerce with digital currencies.
Coinbase announced its partnership with 1-800-Flowers.com in a blog post stating that beginning this fall, it would become possible to send flowers to loved ones and pay with BTC.
Bitcoin payments will also become available across numerous other gifting sites connected to 1-800-Flowers including FannieMay.com, Cheryl’s.com, ThePopcornFactory.com, 1-800-Baskets.com, FruitBouquets.com, and Stockyards.com.
MyCoinSolution brings Bitcoin to business
It certainly looks like 2014 is the year of business adoption. This year, more than 2013, Bitcoin Weekly has been publishing more major services and retailers accepting the virtual currency, and with more businesses climbing on board the Bitcoin boat there’s also been an increase in mainstream media reporting as well.
Hoping to take advantage of mainstream interest in Bitcoin, MyCoinSolution is offering a consulting service to businesses to figure out how to best get them to accept the most popular virtual currency on the market. The niche MyCoinSolution seeks to fill is one of education and advocacy for Bitcoin by bridging the gap between business knowledge of BTC and implementation.
MyCoinSolution launched in April and has already worked with four different companies to provide full solutions for accepting bitcoin. Co-founder Adam Kitain says that the consulting company is currently working with several more companies already and is expecting more to come on board.
When asked what he thinks the biggest obstacle to mainstream Bitcoin adoption right now, Kitain says he believes the key is education.
“People don’t really understand the currency,” he says. “How it works and why it’s useful.”
Kitain believes that mainstream adoption will be a matter of making people familiar and more comfortable with Bitcoin in general and to understand that it’s safe.
David Drexler, MyCoinSolution Director of Communications, adds, “Also fear. Fear of the unknown, it’s a natural thing.”
After all, in 2011—a full two years after Bitcoin launched—it was totally unknown and now people are beginning to learn about it from increased news coverage but it’s still a niche finance market.
US Marshals auction for Silk Road seized bitcoins winners announced
Yesterday, the US Marshals auction for the roughly 30,000 BTC seized from the FBI’s Silk Road bust completed and the winner received their award. Yes, that’s right: only one bidder won the entire lot, who we now know to be Tim Draper.
“The U.S. Marshals Bitcoin auction resulted in one winning bidder,” Lynzey Donahue, a spokeswoman for the Marshals Service, said in a statement. “The transfer of the Bitcoins to the winner was completed today.”
The Marshals Service did not release the winner but we know who it is anyway, today Reuters reported that Venture capitalist Tim Draper won the auction. He did so with the help of Palo Alto-based Vaurum, a high-volume bitcoin trading company focused on large institutions.
Vaurum CEO Avish Bhama released a statement saying Draper would partner with Vaurum to use the 30,000 BTC as a liquidity source for emerging markets.
“Our goal is to build reliable infrastructure and increase liquidity,” said Bhama, “which are two major challenges in the ecosystem.”
At press time the current market rate for 30,000 BTC is approximately $19.6 million. The address the coins were transferred two can be viewed on Blockchain.info.
Update: Draper appeared in a livestream press conference today at 5pm EST/2pm PST to talk about his plans for the 30,000 BTC.