BitDazzle, the Etsy of Bitcoin, launches on the Coinbase API

Today Bitdazzle, a marketplace for small businesses to sell their goods for Bitcoin, launched on top of the Coinbase API. We’re excited about this for a few reasons:

• Bitcoin is great for reducing transaction fees. In two sided marketplaces like Etsy, eBay, and Airbnb, transaction fees are paid twice (once to collect funds from the consumer, once to pay out the merchant). This often brings the all-in cost towards ~6% depending on the payment methods used. The marketplace also takes their cut, which is typically 3.5%-5% of the sale. Here, payments go directly from the customer’s wallet to the merchant’s wallet with no middlemen whatsoever, saving 10% on every sale! One can imagine more distributed marketplaces like this where the listing and the payments are completely decoupled.

• Bitcoin is great in that it eliminates chargeback risk on the merchant side because Bitcoin payments are irreversible by nature. This allows the merchant to be confident in shipping goods because they know they have received payment.

• Since there are no chargebacks, the consumer then must be confident in the merchant they are paying. A marketplace which has reputation of merchants built in (as Bitdazzle does), especially when consumers are dealing with smaller merchants, is a fundamental building block that will become increasingly popular in digital currency.

• There are already over 1,000 merchants on Bitdazzle.

• It lets any small business owner easily list their goods for sale in Bitcoin!