Ebay UK to Allow Users to Buy and Sell Bitcoins

Online marketplace eBay will allow users to buy and sell digital currencies such as bitcoin on its UK website, starting on 10 February.

Bitcoin owners would be able to list on the site's classifieds section, allowing the buying and selling of the cryptocurrency. Deals in classified ad formats mean actual transactions of bitcoins would take place outside of eBay.

"To promote a trustworthy marketplace and ensure compliance with applicable regulations, eBay is currently updating its Currency Policy. The updated policy will clarify that listings for bitcoin and other similar virtual currencies must be listed in the Virtual Currency Category in the Classified Ad format," a spokesman for eBay said.

The Virtual Currency category is expected to be available on the UK site from 10 February.

Ebay previously allowed users to sell software for bitcoin mining and transactions. It is yet to accept the digital currency as a form of payment.

Last week, US-based Overstock.com became the first major online retailer to accept digital currency bitcoin as a form of payment.

However, China's largest online marketplace Taobao said it will ban the sale of bitcoins and all goods relating to the virtual currency later in January.

Moving into Mainstream?

Its presence on a well-known website like eBay would give bitcoin much-needed popularity, as regulators remain doubtful about its application.

Bitcoin was launched in 2008 and is traded within a global network of computers. They can be transferred without going through banks or clearing houses, reducing fees involved in the services significantly.

It has steadily been gaining in popularity despite the volatility in its value. The virtual currency exists as software and is not backed by any country or banking authority.

Critics say bitcoins could be used for drug transactions, money-laundering and other illegal activities due to the near anonymity of those who deal in it.

The digital currency's value plummeted to as low as $640 (£390) after China's central bank barred the country's banks and third-party payment processors from dealing in bitcoin.

In addition, regulatory bodies in the US, Europe and India warned consumers about the risks of virtual currencies.

Despite the setbacks, a growing number of well-known businesses have started accepting the cryptocurrency for payments, including Virgin Galactic.