In a letter addressed to the Heritage Foundation of Washington, D.C., the former chairman and now member of the board for Overstock, Jonathan Johnson has emphasized the use of payments through bitcoin as one of the factors for its growing revenue.
Johnson’s company is one of the first to use bitcoin as a mode of payment as he explains the revenues generated through the company by the form of payments through cryptocurrency.
“We have somewhere between $68,000 and $120,000 a week in cryptocurrency revenues; people buying sheets and toasters using bitcoin or Ethereum or other coins,” he said.
Pros of accepting crypto
Johnson explained the advantages of using cryptocurrency in the business amidst the use of typical payment forms.
“We pay a processing fee for credit cards, and we employ about 40 people in our fraud department. That’s a cost of doing business with credit cards,” Johnson said.
“When we take cryptocurrency, we have a very small transaction fee with Coinbase, much smaller than our credit card processing fee, and we have no fraud prevention department. It’s like a cash transaction. For us, that is a much cheaper way of doing business,” he also added.
A form of democratizing force
He described cryptocurrency and the distributed ledger technology as an effect of democratizing upon access of the fundraising mechanisms and financial services.
“Today, so many of us can’t participate in the capital markets the way accredited investors or well-connected investors can. And those of us that are trying to raise money have a hard time crowdfunding or raising money in a democratized way,” Johnson stated.
But even with all the praises on the fundraising purposes through cryptocurrency; Johnson said that the Medici Ventures, which is an overstock investment firm “is not invested in a single ICO, in large part because the regulation around them is still very hazy.”
He also stated that the sector of the cryptocurrency must operate even without regulation by saying that “we should not be regulating this technology. If there are uses of it that need regulation, maybe.”