Spending bitcoins is a little bit like spending gold. Most stores don’t accept it, and owners want to hold on to it anyway just in case the value hikes up.
Bitcoin Black Friday is Jon Holmquist’s solution to stagnating Bitcoin transactions. Amid a recent report that 70% of Bitcoins remain unspent for six months or more, the Nov. 28 shopping day aims to entice owners of the cryptocurrency to make purchases. With Friday-only discounts offered from online merchants for those who pay with bitcoin, it also aims to improve and increase Bitcoin’s public image through an increasingly large shopping event.
Holmquist, founder of Bitcoin Black Friday, lists the one-day event as his primary employment on his LinkedIn. He spends a major part of the year reaching out to Bitcoin merchants about participating and drumming up publicity on Bitcoin forums.
This year marks the third annual Bitcoin Black Friday. In 2012, it was held on Nov. 9, a second anniversary of sorts for Bitcoin. Holmquist moved it to the more traditional day-after-Thanksgiving date and experienced a jump from 75 merchants to around 600, netting about 100,000 visitors to the Bitcoin Black Friday central hub, according to Holmquist.
“The big problem for us is that most merchants don’t want to plan ahead,” Holmquist told NBC. “It’s a lot of smaller merchants, so they put it off until the day of or the day before.”
In 2013, Holmquist reported that Bitcoin sales hit the equivalent of $6 million during the event. This year, he told NBC that 1,200 merchants are expected to take part. There are as many as 80,000 Bitcoin-accepting merchants globally, the New York Times reports, so Bitcoin Black Friday has a lot of room to grow. Mainly, Holmquist hopes to use the event to attract people who aren’t already Bitcoin users to consider the currency.
“We have two things planned,” he told NBC, regarding low-risk purchasing options. “First is the ability to instantly purchase bitcoin with your credit card: a small amount, like $25 worth. For most people, that’s not too much of a risk. And we’re also going to have a section [of the site] where you can purchase something for a small amount of money.”
Holmquist has a lot of allies in the form of merchants who are finally willing to bet big on Bitcoin. PayPal announced in September that it had entered into agreements with Bitcoin payment processors BitPay, Coinbase and GoCoin, allowing just about any merchant who uses PayPal to accept Bitcoin payments. Several major companies like such as Dell and Showroomprive in Europe have also begun to recently accept Bitcoin payments.
Since last year, the value of a single Bitcoin has crashed from north of $1,000 at the end of 2013 to about $370 today. The plummet is credited in part to the fall of Mt. Gox, a formerly popular Bitcoin exchange that no longer exists. Now that people are less likely to see Bitcoins as nest eggs, and the options for spending them are ever increasing, they may be more willing to part with them.
Photo by btckeychain