Black Friday is an event that has spawned all sorts of retail spin-offs.
First came Cyber Monday, a second bite at the apple from online retailers. Then there was the slow creep into Thanksgiving Day. Two years ago Bitcoin Black Friday made its debut, and it’s a holiday tradition that’s quickly gaining ground.
Bitcoin Black Friday had a moderately successful start, with just 20 merchants initially supporting the campaign. Throughout the day, though, more began to list deals on the site—with the number climbing to 50 by the time the shopping day was through.
Last year, the number surged to 600 merchants, and sales hit the equivalent of $6 million. This year, said the event’s founder, Jon Holmquist, 1,200 merchants are expected to take part, and it’s looking to branch the customer base out beyond the circle of existing bitcoin users.
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“We have two things planned,” he said. “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.”
The response wasn’t overwhelming, but it was enough to convince him to try. This year, Bitcoin Black Friday has grown to the point that Holmquist said he’s had to bring on a small staff to help organize it for the past two months.
Last year, BitcoinBlackFriday.com—the home site of the sale that lists the offers—garnered 100,000 visitors, according to Bitpay. This year’s traffic is likely to be significantly higher, as mainstream retailers, like Newegg, Overstock and TigerDirect, have begun accepting the digital currency, raising consumer awareness.
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Among the companies expected to participate this year are Newegg; precious metals dealer Amagi Metals; domain registration site NameCheap; and gift card reseller Gyft. And that merchant count could easily exceed the estimated 1,200, as listing a deal is free to any company that accepts bitcoin payments.
“The big problem for us is that most merchants don’t want to plan ahead,” said Holmquist. “It’s a lot of smaller merchants, so they put it off until the day of or the day before.”
One company that won’t be participating, apparently, is Overstock. While it’s arguably the largest company to accept bitcoin, a spokesperson said the company’s Black Friday deals will be listed on its own site, though all can be paid for with the digital currency.
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Traditionally, Bitcoin Black Friday deals aren’t revealed until the day after Thanksgiving. (Due to the smaller nature of the businesses that accept the currency, there’s little worry of leaks, and the owners likely realize the deals they offer aren’t likely to whip heads around quite as quickly as the doorbusters at traditional retailers.) This year, however, to build excitement and interest in the event, the list will post on the day before Thanksgiving, letting shoppers prepare accordingly.
Bitcoins have certainly seen a surge of interest in 2014, and investors in the digital currency have ridden a breathtaking roller coaster.
After topping $1,000 at the end of 2013, the value of a bitcoin started this year at more than $940, but that didn’t last long. A plunge started in February, eventually bottoming out in April at $360. It surged again to $665 in early June but hasn’t been able to hold that level, either. These days, it’s hovering around $370.
One of the main causes for the instability was the collapse of the Japanese-based bitcoin exchange Mt.Gox, which once claimed it handled around 80 percent of all global dollar trades for bitcoin. The shutdown of that exchange resulted in 850,000 lost bitcoins and 127,000 empty-handed customers.
Despite these setbacks, though, there’s still an active, enthusiastic community for the currency. Now merchants are hoping that enthusiasm can be converted into profits.