Dropshipping Shocks: Could Bitcoin Be Accepted By eBay?

Dropshipping enterprises on eBay have traditionally relied on PayPal to handle payment transactions, and the system has so far worked quite well for those involved. Yet the growing popularity of Bitcoin has the potential to affect e-commerce and disrupt eBay-owned PayPal – and it seems that eBay itself is starting to do something about it.

What is Bit-coin?

Bitcoin is basically a digital currency in a relatively young stage of development. “Bitcoin” with a capital “B” is the network running the tech behind the digital money, while “bitcoin” with a “b” refers to the currency itself.

What are the primary uses of bit-coin?

It is growing in popularity thanks to the convenience and potential profits gained from prospectors looking to cash in on the volatile prices changes. One of the most important factors for its growing popularity is its ability to avoid transaction fees that traditional credit card or online payment services heft upon the buyer and/or seller. Exchanging foreign currencies can also be much easier and cost-effective when converting bitcoins than going through traditional currency exchanges. This can be massively useful for private label shipping companies that deal with clients around the world – as long as those clients have internet access to utilize their bit-coins.

Where does eBay come in the picture?

eBay has always been a haven for retail and dropshipping businesses that rely on e-commerce to get by. It has traditionally relied on PayPal to handle payments for various goods, from shoes and shirts to watches and digital cameras, but it is quickly realizing that the rising popularity of bitcoins is not something to ignore. It has thus filed a patent with the US Patent and Trademark Office named “System And Method For Managing Transactions In A Digital Marketplace.” Lines in the patent is worded in such a way that it gives the company the ability to convert digital currency into traditional currency – explicitly mentioning bitcoins along with Facebook credits and other forms of currency. Simply put, eBay is looking to directly convert bitcoins (or at least an equivalent digital currency) into traditional currency.

What does this mean for drop-shipping?

Typically good news. Bitcoins are being adopted by more and more people – especially the tech-savvy ones that are very likely to pay for their goods using digital currency. Wholesale enterprises can reach out to a wider buyer base by widening the payment methods involved. The way bitcoins are used – creating disposable addresses that confirm the authenticity of the bitcoins – also make the transaction process significantly quicker and easier for all parties involved. Having eBay quickly convert bitcoins to currency can also protect wholesale vendors from the price fluctuations of bitcoins. This preserves the value of the purchase and allows trusted dropshipping enterprises to accept bitcoins without having to worry about the value suddenly dropping down because of the jitter nature of Bit-coin exchange markets.

A word of caution

Bitcoins may be a convenient method of payment but they are not a reliable tool for dropshipping companies to store their wealth. If you are a dropshipper that keeps are willing to monitor the fluctuating price points of bitcoins, then you can keep the bitcoins and convert them when they are most profitable. If you would rather protect your assets and prefer to conduct business defensively, then it is best that you convert those bitcoins as soon as you receive confirmation of the payment.

All this assuming, of course, that eBay pushes through with its move to accept and convert bit-coins!