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May 29 Satellite TV operator Dish Network
said it would accept bitcoin payments from customers
from the third quarter, joining companies such as Overstock.com
Inc and Zynga Inc in accepting the digital
Dish said it selected Coinbase as the payment processor for
bitcoin transactions with customers who choose to pay their
bills online with the bitcoin wallet of their choice.
Bitcoin is a digital currency that is not backed by any
government or central bank and is bought and sold on a
peer-to-peer network independent of central control.
Users can transfer bitcoins to each other online and store
the currency in digital "wallets".
Coinbase, funded by venture fund Andreessen Horowitz, Union
Square Ventures and Y Combinator, is one such digital wallet.
In March, it launched its Instant Exchange feature, which
will be used by Dish to convert bitcoins to U.S. dollars. Dish's
third quarter starts on July 1.
While bitcoins may not be an alternative to established
currencies, they can cut the cost of moving money around.
PricewaterhouseCoopers estimates that credit card companies
charge around 3 percent in transaction fees and PayPal's
commission can go as high as 4 percent. The same transactions
via bitcoin firms such as Coinbase and BitPay are likely to be
However, there's skepticism about the future of bitcoin,
with critics pointing to recent setbacks such as the Mt. Gox
Mt. Gox, at one time the biggest bitcoin exchange, abruptly
stopped trading in February after it lost nearly half a billion
dollars worth of the virtual coins due to hacking into its
faulty computer system.
Dish shares closed at $59.19 on the Nasdaq on Wednesday.
(Reporting by Sruthi Ramakrishnan and Supantha Mukherjee in
Bangalore; Editing by Kirti Pandey)