Author: Matt Cochrane | January 18, 2018
Its uses vary rather widely
One story that continuously dominated business headlines and investors' thoughts during 2017 was the rise of bitcoin and other forms of cryptocurrencies. During the 2017 calendar year, bitcoin rose in price from just under $900 to almost $16,300 -- incredible! Amidst the fantastic price rises that bitcoin and other cryptocurrencies experienced last year, it is easy to forget that, in theory at least, these are currencies ultimately designed to be used for the buying and selling of goods. While billionaire investor Peter Thiel has espoused the theory that bitcoin can be used as essentially a digital store of value, most bitcoin proponents believe it still represents a better form of money.
Yet, what can bitcoin actually buy? Well, you might be surprised. The currency has come a long way since 2010 when 10,000 bitcoins were used to buy two pizzas in the first recorded transaction using the virtual currency. Here are some of the more surprising things bitcoin can be used to purchase.
Goods from Overstock.com
In January 2014, Overstock.com Inc (NASDAQ:OSTK) partnered with Coinbase to become the first major online retailer to accept bitcoin as a form of currency in the U.S. Later that same year, the company opened up bitcoin as a method of payment for international customers as well. Today, on Overstock.com's website, customers can find a page dedicated to bitcoin complete with a short Youtube video explaining what bitcoin is, a speech by Overstock CEO Patrick Byrne on the merits of the cryptocurrency, and step-by-step instructions on how to get bitcoin and use it to make purchases on Overstock. Customers need only to select the "Pay with Bitcoin" option on the checkout page to make their purchases. Overstock's enthusiasm for the cryptocurrency led the company's stock to a 265% gain in 2017!
While Overstock seemingly concentrates on home decor products, consumers can still use bitcoin to buy a wide range of goods on the retailer's site including stainless steel thermoelectric wine coolers, diamond engagement rings, and bounce houses!
Couch potatoes rejoice! Consumers can pay their satellite TV bills using bitcoin. In 2014, Dish Network Corp (NASDAQ:DISH) announced in a press release that it would be partnering with Coinbase to allow its customers to pay their satellite cable bills using bitcoin. In the press release, Dish Network Executive Vice President Bernie Han stated, "We always want to deliver choice and convenience for our customers and that includes the method they use to pay their bills. Bitcoin is becoming a preferred way for some people to transact and we want to accommodate those individuals." Dish currently has a little over 13.2 million pay-TV subscribers.
Video games and media content
In late 2014, Microsoft Corporation (NASDAQ:MSFT) began accepting bitcoin as a payment option to download content from its Windows and Xbox stores, but not to purchase items from its online Microsoft store. Explaining its bitcoin policy, Microsoft's support page states it cannot be used for gift cards and, once bitcoin has been added to the account, it cannot be refunded. Essentially, this means customers can use bitcoin to buy video games, movies and television shows, and music. Microsoft's Azure cloud platform also offers a blockchain-as-a-service program and Microsoft's Excel now supports bitcoin applications.
Guns and ammo
That's right, customers can now use bitcoin to buy guns … legally. Central Texas Gun Works, located in Austin, TX, proudly proclaims on its website, "We now accept Bitcoin as a method of payment for online and in-store transactions." A quick perusal of the store's site shows the company offers a wide variety of shotguns, handguns, rifles, ammo, gun accessories, hunting knives, and gun safety classes. The company also boasts that it is the largest online gun store in Texas. Well, they say everything is bigger in Texas!
On the Bitcoin Real Estate website, buyers on the lookout for property from around the world can shop for real estate in, well, just about anywhere. As the website states, "We are a worldwide Bitcoin Real Estate listings company … With Bitcoin Real Estate, homeowners can now offer their homes privately or with their Agent / Real Estate company." To list a property on the site, customers can use a PayPal Holdings Inc (NASDAQ:PYPL) account or bitcoin, Litecoin, or Ethereum to pay the $14.99 listing fee.
Listings include a diverse selection of properties: From a 2/2 condominium in Miami Beach going for about $300,000 to the 113-acre Byron Bay Rural Tourist Facility in Binna Burra, Australia going for about $3.5 million. Warning: Many properties I looked at came with significant markups when paying with bitcoin.
Purchases from any business that uses Intuit's Quickbooks software
In June 2014, Intuit Inc. (NASDAQ:INTU) began allowing merchants using its popular Quickbooks invoice software to accept bitcoin as a method of payment through its PayByCoin platform. Intuit's website boasts that the PayByCoin offering can benefit the seller in numerous ways including low fees (starting at 0%) with deposits that will be made either instantly or the next day. Since bitcoin transactions are irreversible, Intuit says the payment method guarantees the availability of funds from the buyer and reduces fraud. Furthermore, sellers will always receive the exact invoice amount -- Intuit ensures there will not be any exchange risk with accepting bitcoin as a method of payment. Intuit also offers assistance with accounting for bitcoin when filing for taxes.
A trip to space
If bitcoin is the currency of the future, it's only fitting that it can pay for the vacation of the future. In late 2013, billionaire and space entrepreneur Richard Branson announced that Virgin Galactic would accept bitcoin as a method of payment for its future commercial space flights. When making the announcement, Branson said one future astronaut had already purchased her future ticket using the cryptocurrency.
Branson has a history of being bullish on bitcoin's future. In 2014, he invested $30 million in BitPay, a start-up that facilitates transactions using bitcoin.
Yes, consumers can now pay for the world's oldest accepted form of payment with its newest. In March 2016, precious metals dealer JM Bullion began accepting bitcoin as payment for its metals through the BitPay platform. Not only does JM Bullion accept bitcoin, it also offers a 3% discount to customers who use the currency due to the low fees associated with the currency. Although not as much as the 4% discount the company offers to those who pay with a check or wire transfer, it's better than not getting any discounts like those paying with credit cards or PayPal accounts. A "commemorative" bitcoin round in either copper or silver is also available for purchase on JM Bullion's site.
Popular travel booking site Expedia Inc (NASDAQ:EXPE) allows vacationers to pay for their travels using bitcoin through a partnership with Coinbase. Expedia is the parent company for travel booking brands Orbitz, Travelocity, Hotels.com, and Hotwire. Under the company's Bitcoin Terms and Conditions, customers have ten minutes to pay for bookings with bitcoin before the exchange rate is reset with a possible price change. A small transaction fee is collected for verification purposes and, once a vacation is booked and paid for using bitcoin, it cannot be cancelled. Refunds require customers to open a Coinbase account.
Jackpocket is an app that lets users buy certain state lottery tickets. Jackpocket partners with officially registered and licensed lottery ticket dealers and acts as an agent acting on the consumer's behalf. Players can purchase tickets for popular lotteries such as the New York State's, Powerball, or Mega Millions. And, yep, you guessed it -- Jackpocket accepts bitcoin as a method of payment. According to its website, Jackpocket works with any bitcoin wallet and users can fund their Jackpocket account by selecting the "Fund with bitcoin" option. So, for those who want to take more risks with their money than just investing in bitcoin, you can now play the lotto as well!
With many more possibilities still to come
While bitcoin still has a long way to go before it will be recognized as a legitimate and universal form of payment, it has certainly come a long way in just a few years. From booking a vacation and buying a Miami Beach condo to paying for home decor products online and shotguns in Texas, bitcoin can be used to buy an incredibly wide variety of goods and services in the world today. Of course, none of that means bitcoin and other cryptocurrencies are not in a bubble, but it does mean it can be used today to legally purchase almost anything buyers could want.
Teresa Kersten is an employee of LinkedIn and is a member of The Motley Fool’s board of directors. LinkedIn is owned by Microsoft. Matthew Cochrane owns shares of Microsoft and PayPal Holdings. The Motley Fool owns shares of and recommends Intuit and PayPal Holdings. The Motley Fool recommends Expedia. The Motley Fool has a disclosure policy.