Wednesday, November 21, 2012

What’s Your Bitcoin Strategy? WordPress Now Accepts Bitcoin Across The Planet

By Jon Matonis
Forbes
Friday, November 16, 2012

http://www.forbes.com/sites/jonmatonis/2012/11/16/whats-your-bitcoin-strategy-wordpress-now-accepts-bitcoin-across-the-planet/

Best CEO Toni Schneider in 2007
I awoke to incredible news this morning. Leading web publishing service Wordpress.com announced that they will begin accepting the nonpolitical cryptographic money Bitcoin as a payment method for various upgrades.

Then I remembered that WordPress.org powers our online publishing platform. It also powers the blog platform for The New York Times, CNN, Reuters, Mashable, NBC Sports, GigaOm, TechCrunch, ELLE Girl, RealClearPolitics, TED, National Football League, General Motors, UPS, eBay, Sony, and Volkswagen.

Not only does this strategic move bring new unserved customers into the WordPress fold, it paves the way for the online publishing platform run by parent company Automattic not to be restricted by the choices of its payment partners. Companies doing business and accepting payments globally are subject to increasing fees and sometimes arbitrary chargebacks which no doubt impact their bottom line. WordPress would probably not even mind if a large chunk of their mainstream payment processing migrated to bitcoin.

Over 57.8 million WordPress sites are written in 120 different languages creating nearly 32 million new user posts each month.

Criticizing the centralized bankcard associations and citing payment method deficiencies, WordPress spokesperson Andy Skelton said, "Unlike credit cards and PayPal, Bitcoin has no central authority and no way to lock entire countries out of the network. Merchants who accept Bitcoin payments can do business with anyone." And thus the planet becomes immediately open to their products and services.

"PayPal alone blocks access from over 60 countries, and many credit card companies have similar restrictions," continued Skelton. "Some are blocked for political reasons, some because of higher fraud rates, and some for other financial reasons. Whatever the reason, we don’t think an individual blogger from Haiti, Ethiopia, or Kenya should have diminished access to the blogosphere because of payment issues they can’t control." [Note: WordPress.com updated their original blog post which mentioned Cuba and Iraq.]

Vitalik Buterin of Bitcoin Magazine brings up an equally significant reason for accepting payment in Bitcoin, "Another argument which WordPress did not mention is anonymity. Many bloggers that operate in restrictive regimes do so using pseudonyms for their own protection, and traditional payment methods like credit cards and PayPal are unusable for those bloggers because they expose the payer’s physical identity." With user-defined anonymity and identity privacy, bitcoin offers unparalleled safety to dissident bloggers and free speech advocates.

Initially, processing will be managed by payment service provider BitPay, Inc. of Orlando, Florida. BitPay shields WordPress from having to handle actual payments by immediately converting and transferring sales proceeds into a WordPress merchant bank account. This minimizes the currency risk for the accepting merchant. An important configurable option also allows the merchant to retain Bitcoin balances for their own account and subsequent usage.

Although WordPress states that they are not waiting for a sufficient number of confirmations from the bitcoin block chain, it is largely irrelevant for e-services since upgrades can simply be deactivated or reversed due to a failed payment.

WordPress may not stand as the lone giant for very long since Reddit CEO Yishan Wong hinted last week at the social news site's willingness to begin transacting in Bitcoin for Reddit Gold subscriptions. Reddit is a subsidiary of Condé Nast's parent company, Advance Publications.

As the bitcoin juggernaut continues to roll forward absorbing merchants and customers globally it leaves archaic and unsuspecting payment methods in its wake. As one bitcoin forum member articulated, merchants will increasingly be asked: "What's your Bitcoin strategy?"

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