Californian retailer Stephen Silver Fine Jewelry claims that Bitcoin now represents 20% of its jewelry sales, overtaking credit card.
CEO Stephen Silver commented that he integrated Bitcoin as a payments alternative back in 2014 as it was beginning to show signs of popularity, and now claims that it is luxury goods that the cryptocurrency is well suited to:
“Given that Stephen Silver Fine Jewelry is based in Silicon Valley, the cradle of innovation, we’ve been monitoring the development of blockchain technology since 2008. In 2014, we felt it had matured to the point that we could bring the technology into our store.”
Luxury items such as artwork, real estate and jewelry have seen an increase recently in Bitcoin purchases. According to Devtome.com, this is unsurprising, especially when Bitcoin is juxtaposed with credit cards as a payment option. Stores pay fewer fees, and therefore this saving can be passed on to customers, reflected as lower prices or other added benefits, although not all retailers make the generous offer.
Foreign transactions also favor Bitcoin ahead of credit cards as foreign exchange requires an extra payment online when funds are sent to the country of origin, whereas Bitcoin or other cryptocurrencies bypass this fee regardless of the location of the seller, apart for a minimal mining fee.
Property developers and entrepreneurs are beginning to favor Bitcoin payments for similar reasons and it has been reported that Dubai is becoming a popular venue for luxury property purchases, again using Bitcoin. Upon selling a Dubai property recently for USD 327 million for the Bitcoin equivalent, lingerie tycoon turned property investor Michelle Mone was surprised at the rush it caused for other Bitcoin sales:
“We allocated 50 out of 1,300 developments. We’ve sold all out. Some bought ones and twos, and one individual bought ten,” said Mone, who added that company partner Barrowman decided to accept cryptocurrencies because he was frustrated Bitcoin was not being used enough by retailers and businesses.
Earlier this year, Dubai ArtBank announce that it would accept cryptocurrency payments for artwork, hoping that it would make higher returns for collectors and make it easier for buyers to transfer large sums, according to TimeOut Dubai.
Garrick Hileman, an economic historian at the University of Cambridge and the London School of Economics suggested that using Bitcoin for luxury items makes sense as items costing between USD 10,000 and a million dollars can incur massive fees to the tune of up to USD 50,000.
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