Two California Startups Create BitDazzle to Take Bitcoin Mainstream

Bitcoins 25025591 by 3dart

Cashie Commerce, a San Diego startup that provides a purchasing platform for online merchants, has partnered with San Francisco-based Coinbase to create BitDazzle, a new online marketplace that accepts the digital currency Bitcoin.

The move comes just weeks after the feds shut down the illicit trafficking website Silk Road—where all transactions were conducted using Bitcoins—and arrested owner Ross William Ulbright on federal charges of money laundering, conspiracy to commit drug trafficking, and other crimes. On Friday, the payment processing company Dwolla unexpectedly disclosed plans to phase out its own Bitcoin-related businesses.

Yet Cashie Commerce CEO Hieu Bui said he does not view the development of BitDazzle.com as a higher-than-normal business risk. He welcomed government efforts to shut down the online black market for Bitcoin-based sales of drugs, guns, and other illicit products.

“We’re trying to make Bitcoin more mainstream, and one of the ways to do that is to have more products and merchants who are mainstream,” Bui told me by phone this morning. He said PayPal also was used in dubious ways at the beginning, and gained broader acceptance as the payment system cut ties with porn sites.

“I’m optimistic Bitcoin is here to stay,” says Dave McClure, the founder of 500 Startups and a Cashie Commerce investor, in a statement announcing the Bitcoin marketplace today. “Bringing together a Bitcoin market leader like Coinbase and an e-commerce leader like Cashie Commerce to create BitDazzle is a great step forward in offering Bitcoin to the masses.”

Coinbase, a Y Combinator startup, was founded in 2012 to make it easy for the average person and business to use Bitcoins in secure online transactions. Coinbase says

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Author: Bruce V. Bigelow

In Memoriam: Our dear friend Bruce V. Bigelow passed away on June 29, 2018. He was the editor of Xconomy San Diego from 2008 to 2018. Read more about his life and work here. Bruce Bigelow joined Xconomy from the business desk of the San Diego Union-Tribune. He was a member of the team of reporters who were awarded the 2006 Pulitzer Prize in National Reporting for uncovering bribes paid to San Diego Republican Rep. Randy “Duke” Cunningham in exchange for special legislation earmarks. He also shared a 2006 award for enterprise reporting from the Society of Business Editors and Writers for “In Harm’s Way,” an article about the extraordinary casualty rate among employees working in Iraq for San Diego’s Titan Corp. He has written extensively about the 2002 corporate accounting scandal at software goliath Peregrine Systems. He also was a Gerald Loeb Award finalist and National Headline Award winner for “The Toymaker,” a 14-part chronicle of a San Diego start-up company. He takes special satisfaction, though, that the series was included in the library for nonfiction narrative journalism at the Nieman Foundation for Journalism at Harvard University. Bigelow graduated from U.C. Berkeley in 1977 with a degree in English Literature and from the Columbia University Graduate School of Journalism in 1979. Before joining the Union-Tribune in 1990, he worked for the Associated Press in Los Angeles and The Kansas City Times.