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This article was published on August 27, 2013

Coinbase encourages merchants to adopt Bitcoin after removing fees for first $1m in transactions

Coinbase encourages merchants to adopt Bitcoin after removing fees for first $1m in transactions
Jon Russell
Story by

Jon Russell

Jon Russell was Asia Editor for The Next Web from 2011 to 2014. Originally from the UK, he lives in Bangkok, Thailand. You can find him on T Jon Russell was Asia Editor for The Next Web from 2011 to 2014. Originally from the UK, he lives in Bangkok, Thailand. You can find him on Twitter, Angel List, LinkedIn.

Coinbase, the US startup that processes Bitcoin payments, has announced that it is now waiving all processing fees for merchants for their first $1 million in transactions.

Coinbase, which raised $5 million in funding this year, charges a flat 1 percent rate to merchants that wish to convert Bitcoin into their local currency, so this move effectively means early-adopting retailers can save up to $10,000. (The company charges no transaction fee.)

That’s likely to appeal to smaller retails, given the relative low volume of $1 million, which will also appreciate that transactions are not subject to chargebacks and can be processed in minutes.

“We’ve long believed that merchant adoption is key to Bitcoin going mainstream,” the company explains. “We wanted to lower all barriers for new merchants to get started, and help highlight some of the economic benefits of accepting Bitcoin.”

While there are plenty of benefits to Bitcoin, there is a degree of uncertainty about the long-term future of the stateless currency. US officials have seized as much as $5 million from Mt. Gox — from Wells Fargo and Dwolla accounts — while the Japan-based trading service shut down US dollar trading for two weeks.

Despite the uncertainties there are positives. Germany has begun recognizing Bitcoin as an official unit of currency, while any US regulation — though unknown at this point — could give Bitcoin the legitimacy and security to be more mainstream and stable.

Coinbase’s offer is a nothing-to-lose scenario for retailers, and it will be interesting to see whether it spurs increased uptake.

Related: Coinbase now lets you send, buy or sell Bitcoin via SMS

Headline image via zcopley / Flickr