Can the advance of the online trading platform eBay into the NFT space push the crypto trend into the mainstream?
This article first appeared in the June issue of Cryptocompass, the magazine for everything to do with blockchain. Do you want to know more about it? Then click on this button:
In a few years the online marketplace eBay will celebrate its 30th birthday, making it one of the real dinosaurs of Silicon Valley. In the long history of the company, the company has continued to develop and cemented its position as a constant in the digital economy. Now the Californians are preparing to penetrate the crypto space. The keyword is: Non-fungible Token (NFT). The company is also considering integrating cryptocurrencies as a means of payment. But what does this mean for the crypto space and what are the chances of the tech giant of asserting itself against established NFT trading venues?
eBay: NFT and Bitcoin Payments
A lot of money can be made with non-fungible tokens (NFT). This was proven not least by the sale of the work “Everydays: The first 5,000 Days”, which brought in an impressive 69 million US dollars for the artist Beeple at a Sotheby’s auction. It feels like every hour we get news about artists of all kinds, be they musicians, filmmakers or painters who want to immortalize their works as NFT on the blockchain in order to make the greatest possible profit. There are also many arguments for this beyond easy money. Interactivity is often mentioned, as is a more personal bond between the fan and the respective band, sports club or artist. In order for the NFT to be sold, however, intermediaries are required. Because the creators themselves rarely step in as salespeople. And so, in the orbit of the new crypto hypothesis, an ever-growing economy is forming – NFT trading venues are springing up everywhere from left and right.
At the same time, one company after another is announcing its entry into the crypto business, also far away from non-fungible tokens, be it in terms of Bitcoin as a store of value or in the introduction of crypto currencies as payment methods. Although Elon Musk has meanwhile backed down a bit about the much-cited and often misunderstood environmental dilemma of Bitcoin, the crypto space is still heading inexorably towards mass acceptance. This does not leave its mark on the greats of Silicon Valley either. And after PayPal, Facebook and Tesla, eBay is now drawing attention to itself and the company’s crypto plans, not only wanting to function as an NFT trading platform, but also researching ways to integrate crypto currencies as a means of payment. Developments that fit seamlessly into the company profile in view of the long history of the online marketplace.
At the beginning of the digital age it was still the mere exchange of information that preoccupied the modems, thanks to the first browsers and the emergence of the World Wide Web with the mainstream, the economy poured into the Internet. By the turn of the millennium, the new dot-com industry had swelled so much that it finally burst – and carried away a large part of the previously highly profitable companies. Those tech companies that were able to hold their own back then are still at the top more than 20 years later, listening to names like Amazon, Google and eBay.
The Paris-born programmer Pierre Omidyar, who founded the online marketplace in 1995, not only followed the call for quick money (like so many other companies at the time), but also knew how to satisfy a basic need for the new “digital citizens”: trading in goods.
Initially operated as a mere hobby, Omidyar only began charging fees from the auctioneers and sellers on his site when his internet provider at the time increased the cost of his connection because his website generated so much traffic. However, the success quickly took on proportions that exceeded the requirements of a hobby project. Already in 1996, just one year after the first auction (a defective laser printer), 250,000 items were auctioned. In January 1997 alone there were 200,000. A year later, eBay went public with great success and was able to almost triple its target price of 18 US dollars per share – to 53.80 US dollars on the first day of trading.
And so the bursting of the dot-com bubble passed the online marketplace without a trace, which in 2002 made one of the most important investments in tech history.
Because on October 3, 2002, eBay bought the company PayPal, which had recently gone public, for 1.5 billion US dollars – today the market capitalization of the payment service provider is around 280 billion US dollars. Other successful acquisitions include those of the communications service provider Skype, the ticket seller StubHub, the online marketplace Craigslist and the Japanese trading platform Qoo10.jp.
Not least because eBay showed foresight with the acquisition of PayPal, also with regard to payment methods, the crypto space eBay has always paid close attention as well. However, the California-based online marketplace never wanted to officially comment on the integration of cryptocurrencies. But that is exactly what has now changed.
Out of nowhere the news reached us when eBay announced on May 11th that it would start trading with NFT immediately. And that’s not all: Jordan Sweetnam, eBay’s Senior Vice President, told Reuters: “In the coming months, eBay will bring new opportunities to integrate blockchain-powered collectibles into our platform.”
Just one week earlier, eBay CEO Jamie Iannone gave an interview to the US broadcaster CNBC on the occasion of the integration of Apple and Google Pay, in which he emphasized that eBay is examining the integration of cryptocurrencies as a means of payment: “We are expanding the types of payments we assume … for this we will continue to consider other options such as cryptocurrencies. “
It is therefore quite possible that eBay is currently once again proving a good investment nose with NFT and cryptocurrency integration and is not just following the call for quick money. EBay founder Pierre Omidyar is no longer on board, but the company’s executive suite still seems to understand what has always made the platform so successful – the simple trade of goods. Be it defective laser printers or the rights to use digital objects in the form of NFT.
And yet: The competition, especially in the NFT area, has built a huge lead over eBay in recent months (and years). Trading platforms like OpenSea, Rarible, Decentraland and the Enjin Marketplace NFT buyers and sellers of all sectors a suitable home. In the end it is the customers who decide whether eBay can assert itself.