[Rising on Reddit] Bitpay Reportedly Lays Off Most of Entire Staff

[JeromeL]

Well who needs merchants anyway?

Who Needs Merchants Anyway?
Hoarders are more important than merchants. If a restaurant downtown starts accepting bitcoins, this does not necessarily create an incentive for anybody to buy more bitcoins. Why would anyone bother if they can still just use a credit card? If you can convince a merchant to accept bitcoins and stop accepting dollars, then I’ll be impressed.

Unless a merchant is offering something that cannot be bought for dollars, or at least offering a discount, he is only benefiting Bitcoin to the extent that he encourages more hoarding. If he immediately converts the bitcoins he receives as payment into dollars, and if his customers only buy bitcoins so as to spend them at his shop shortly thereafter, then neither has much direct effect on Bitcoin’s demand. The real hero is the hoarder behind the scenes who buys from the merchant and enables him to convert his payments into dollars.

http://nakamotoinstitute.org/mempool/im-hoarding-bitcoins-and-no-you-cant-have-any

I appreciate core devs haven't beeing caught in the GavinHearn trap "we need better payment features for customers/merchants so we can compete with PayPal !". Core devs are not compromising security, privacy and censorship-resistance, for user-experience, and I fully agree with them. User experience should be entirely handled by wallets and upper layer protocols.

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[BillyBobZorton]

Good, after the "hacking" incident they proved being huge morons. I still didn't understand the point of Bitpay.
The point of Bitcoin is a decentralized economy, then someone tell me why do I need some third party to deal with my money? If I want to get paid i'll just get an address and share it with whoever has to pay me? Whats the point of Bitpay, it only turns Bitcoin into paypal 2.0

[MicroGuy]

Good, after the "hacking" incident they proved being huge morons. I still didn't understand the point of Bitpay.
The point of Bitcoin is a decentralized economy, then someone tell me why do I need some third party to deal with my money? If I want to get paid i'll just get an address and share it with whoever has to pay me? Whats the point of Bitpay, it only turns Bitcoin into paypal 2.0

The only thing these guys seem to be good at is raising venture capital and burning through cash. If I had been running the company, I would have placed equal focus on payroll integration and kept costs at a minimum. The executive that sent $1.8 million to the wrong person should have resigned/been forced out immediately.

Here's the RT show: https://www.youtube.com/watch?v=E5rVjD1XCHE

I can't see any possible way this company can survive under its current management. The company's co-founder was on RT.COM just a few days before this announcement. He should have been at the helm of a company war room instead of jetting around having fun.

Your company is about to crash into an iceberg - not the best time to be traveling around doing interviews.

[tsoPANos]

Oh this is bad news. Bitpay is the only major payment processor after coinbase.
Let's hope that it won't get down. We don't want to give coinbase the monopoly.

[TeamButtcoin]

The CEO fucks up and the staff gets laid off... how typical... punish someone else for his incompetence and lack of a proper business procedures.

you must be new to 'capitalism'

[hdbuck]

bitpay's new business model: https://bitcointalk.org/index.php?topic=1190505.0

[worhiper_-_]

Oh this is bad news. Bitpay is the only major payment processor after coinbase.
Let's hope that it won't get down. We don't want to give coinbase the monopoly.

I don't think it'd give coinbase the monopoly but rather open up the space for newer and better competitors. Likely those competitors wouldn't get social engineered into handing out 2 million dollars too.

[hdbuck]

Oh this is bad news. Bitpay is the only major payment processor after coinbase.
Let's hope that it won't get down. We don't want to give coinbase the monopoly.

I don't think it'd give coinbase the monopoly but rather open up the space for newer and better competitors. Likely those competitors wouldn't get social engineered into handing out 2 million dollars too.

coinbase is goldman sachs.. hopefully they fail too.

[worhiper_-_]

Oh this is bad news. Bitpay is the only major payment processor after coinbase.
Let's hope that it won't get down. We don't want to give coinbase the monopoly.

I don't think it'd give coinbase the monopoly but rather open up the space for newer and better competitors. Likely those competitors wouldn't get social engineered into handing out 2 million dollars too.

coinbase is goldman sachs.. hopefully they fail too.

I don't think that'd be the case. Coinbase hadn't had a history of making headlines with bad news.

I think they have a more viable and accessible business model with their exchange and wallet service. I think it's good to have them around, having an easy to use service might introduce more people to bitcoin's fundamentals after they do some research of their own.

[Kprawn]

Good, after the "hacking" incident they proved being huge morons. I still didn't understand the point of Bitpay.
The point of Bitcoin is a decentralized economy, then someone tell me why do I need some third party to deal with my money? If I want to get paid i'll just get an address and share it with whoever has to pay me? Whats the point of Bitpay, it only turns Bitcoin into paypal 2.0

The only thing these guys seem to be good at is raising venture capital and burning through cash. If I had been running the company, I would have placed equal focus on payroll integration and kept costs at a minimum. The executive that sent $1.8 million to the wrong person should have resigned/been force out immediately.

Here's the RT show: https://www.youtube.com/watch?v=E5rVjD1XCHE

I can't see any possible way this company can survive under its current management. The company's co-founder was on RT.COM just a few days before this announcement. He should have been at the helm of a company war room instead of jetting around having fun.

Your company is about to crash into an iceberg - not the best time to be traveling around doing interviews.

Well spotted there MicroGuy. I think the "Couple of thousands of transactions per day" they saw then, will decline to "a couple of hundred transactions per day" after this

fiasco. Tony and Marcel must focus on saving the sinking Titanic, not dancing with the band while it's sinking. Any company would suffer with a $ 1.8 million knock, and

hopefully they will be able to pull it out of the fire. Accept responsibility and publicize the changes that was done to prevent this in future.

[Gleb Gamow]

Good, after the "hacking" incident they proved being huge morons. I still didn't understand the point of Bitpay.
The point of Bitcoin is a decentralized economy, then someone tell me why do I need some third party to deal with my money? If I want to get paid i'll just get an address and share it with whoever has to pay me? Whats the point of Bitpay, it only turns Bitcoin into paypal 2.0

The only thing these guys seem to be good at is raising venture capital and burning through cash. If I had been running the company, I would have placed equal focus on payroll integration and kept costs at a minimum. The executive that sent $1.8 million to the wrong person should have resigned/been forced out immediately.

Here's the RT show: https://www.youtube.com/watch?v=E5rVjD1XCHE

I can't see any possible way this company can survive under its current management. The company's co-founder was on RT.COM just a few days before this announcement. He should have been at the helm of a company war room instead of jetting around having fun.

Your company is about to crash into an iceberg - not the best time to be traveling around doing interviews.

https://www.youtube.com/watch?v=E5rVjD1XCHE

@20:09 mark, BitPay processes ~2,000 transactions a day, up 30% from 6 months ago. Based on them numbers, I'd love to see what was presented when seeking VC funding to successfully garner $30M+ in capitals.

EDIT: This post was penned prior to me reading the post directly above this one.

[Mickeyb]

I hear what you all are saying about how we don't need payment processors like Bitpay and how Bitcoin wasn't imagined to work with these processors but to work independently, and I agree with all of this.

But we have to remember one thing, not too many merchants out there would even touch us if there was none of these payment processors. We still need to earn trust, get our price under control, and build our own infrastructure in order to be able to live without Bitpay and others.

Sadly, this is our present and it's like that!

[marcus_of_augustus]

Wonder if Jeff Garzik will still have a job there, and for how long?

Also wonder where all that money went ... pay well I guess. I recall someone saying something along the lines of that BitPay was "creaming it" "an absolute money-making machine" (was that Trace Meyer who said that?).

[Q7]

I wouldn't be surprised considering how they managed to lose that huge sum of money purportedly through email hack? I doubt... but for whatever reason, I only felt sorry for the employee as these has really nothing got to do with them.

Most of the time the same thing happened in outside world corporate scenario when a wrong decision made by the top management will have the downline employees having to bear the burden and suffer the consequences of the loss. This goes to show how unfair things can get.

[RGBKey]

Maybe the "hack" was actually fake and an attempt at insurance fraud, that would be pretty bad. I like using coinbase as an exchange.

[smoothie]

The CEO fucks up and the staff gets laid off... how typical... punish someone else for his incompetence and lack of a proper business procedures. They have to make up for the

$ 2 000 000 they lost, and the easiest way is to trim the least important people in the business. Their main problem is not the $ 2 000 000 ...It's their reputation that is

shattered and how this once again taints the Bitcoin community with another scandal.  

This has nothing to do with Bitcoin. I thought we had moved away from such broken logic after Mt.Gox.

Fiat businesses go bankrupt and squander money all the time, this is no an indictment on the form of money itself.

Yea, the main difference being that fiat is a established currency and Bitcoin the new technology trying to disrupt it. Every time a MtGox or a BitPay happens, the shills and

the media jump onto this like flees on a dog. This definitely has a impact on the community.. like it or not... it's a fact. 

It's a fact that intelligent people who would consider Bitcoin as an investment can see this drama for what it is: market participants incompetence.

If that scares a couple of Jims & Sallies on the street from buying Bitcoin that does not bother me one bit because they wouldn't be buying for the right reasons in the first place and it is likely the value they would bring to Bitcoin wouldn't move the needle one bit anyway.

So are you saying that if this trend continues with other big bitcoin businesses laying off their employees that it is a bullish signal for bitcoin?

lol

[smoothie]

The CEO fucks up and the staff gets laid off... how typical... punish someone else for his incompetence and lack of a proper business procedures. They have to make up for the

$ 2 000 000 they lost, and the easiest way is to trim the least important people in the business. Their main problem is not the $ 2 000 000 ...It's their reputation that is

shattered and how this once again taints the Bitcoin community with another scandal.  

Well, you can't nessecerely blame the CEO for wanting to cut costs. It seems as though the profit wasn't enough, he alone probably couldn't stop this from coming. I'm sure that laying off people was the last resort, probably investors played a role in this.

I do believe so. Trace mayer had said something along the lines of bitcoin companies wasting resources on this block size debate and that is why people are being laid off...poor stewardship of investor funds.

[smoothie]

Well who needs merchants anyway?

Who Needs Merchants Anyway?
Hoarders are more important than merchants. If a restaurant downtown starts accepting bitcoins, this does not necessarily create an incentive for anybody to buy more bitcoins. Why would anyone bother if they can still just use a credit card? If you can convince a merchant to accept bitcoins and stop accepting dollars, then I’ll be impressed.

Unless a merchant is offering something that cannot be bought for dollars, or at least offering a discount, he is only benefiting Bitcoin to the extent that he encourages more hoarding. If he immediately converts the bitcoins he receives as payment into dollars, and if his customers only buy bitcoins so as to spend them at his shop shortly thereafter, then neither has much direct effect on Bitcoin’s demand. The real hero is the hoarder behind the scenes who buys from the merchant and enables him to convert his payments into dollars.

http://nakamotoinstitute.org/mempool/im-hoarding-bitcoins-and-no-you-cant-have-any

You forget that bitpay themselves were keeping bitcoin on their end..

customers of bitpay could allocate a % of their revenue to keep in USD (or other fiat) and bitcoin.

So yeah bitpay did allow users to choose this. And it wasn't clear cut and dry about converting to fiat 100%.

SO I believe there is a VALUE added in having payment processors to bitcoin.

"who needs merchants anyway?"....<-------------- that is a closed minded way of thinking.

As long as the fiat system exists there will be always the opportunity to add value to the bitcoin ecosystem. The VALUE will not just magically appear into the bitcoin ecosystem. People need to be exposed to it by using bit coin in different ways.

How else are they going to understand how bitcoin work and why it is important if they dont have a viable way to put on TRAINING wheels for the transfer of value from the fiat system to the bitcoin system.

You can't have a clear cut dry merge to bitcoin. This process could take decades.

If the end goal is to have bitcoin be more widely accepted and be more main stream...it will take time and saying that "who needs merchants anyways" is stupid as merchants add value and they help spread the word to others who they know (family friends etc) and that can turn into press as well which is how bitcoin got noticed...through networking of people.

Merchants add value to the bitcoin ecosystem and to turn a blind eye to it saying "it doesn't matter we dont merchants"...is ignorant.

[smoothie]

It's kinda sad on the part of the employees whether this news is true or not. Losing almost $2m in one instance is a big blow to the company. Saying it is hacked by someone or whatsoever shouldn't be enough on the part of the CEO--he should give more thorough explanations as to why this happened.

This news is true,
http://www.coindesk.com/bitcoin-processor-bitpay-reduces-staff-in-cost-cutting-effort/
Also this is effected to merchants: http://www.coindesk.com/bitpay-cut-free-unlimited-processing-merchants/

So the article that I've read about BitPay's employees crying is true? No wonder they'd be crying because they lose their jobs and it's hard to find a new job nowadays. What I'm doubting is that whether they're really hacked or not (but I know there is much more than just 'hacked').

It has been confirmed that they have lost 2M$ in an email phishing scam/hack.

Although this definitely did not help their cause this obviously is not the reason for the current layoff.

I've also read that they reduced the number of their employees to 'cut costs' and I wonder how would they still deliver an effective operation given that they have less numbers of employees compared to what they have before. By any means, do you have a link on where you've read that they lost $2M because of the scheme you posted above?

simple: everyone who now still works at bitpay now has to work that much harder/smarter or they will fail as a company.

[smoothie]

So what would happen to all of the companies that accept Bitcoin through Bitpay if Bitpay is to cease its existence? Would we all of the sudden stay without almost half of our merchants? This would suck and it would surely cause the blow to whole Bitcoin economy!

I am sure this is all connected to the recent news on how they have been hacked for almost $2 million. Nothing good will come out of this I am afraid!

Nonsense. Pure nonsense

Bitcoin doesn't exist to buy game credits on Microsoft store.

The reason why they have to cut costs is that barely any of their merchants are seeing any sale from Bitcoin acceptance and therefore they aren't generating any revenue whatsoever.

I'm more convinced that the hack of $2million is the reason for the lay offs and cost cutting.