According to this post in BitcoinTalk,.org, PayPal is discriminating against sellers of Bitcoin related items. The poster, TerraHasher, claims to have a recording of a PayPal manager saying, “well its all the same and bitcoin is direct competition with paypals business model therefore we do not condone, anything bitcoin related.” After describing what appears to be a pattern of harassment explained best by this bias against Bitcoin related sellers, he lawyer-ed up and is preparing to file suit against PayPal.
Was he selling Bitcoins? No. He was “selling specialized hardware which is like a computer but designed for one purpose, and that is hashing on a SHA-256 encrypted network.”
If PayPal, a wholly owned subsidiary of eBay, doesn’t resolve the grievances within two weeks of him sending an intent to sue, he’ll then be cleared by a judge to file the lawsuit for $4 million.
The Bitcoin vs Paypal headlines are bound to be a bigger bite that the value of the lawsuit itself for eBay as it becomes clear to investors that there’s a new threat to PayPal’s business model. To put it in perspective, with a market cap of $67 billion, and 1.29 billion shared outstanding, a drop in eBay’s share price of 1 penny represents more than 3x the $4 million TerraHasher says he plans to sue for.
News of a Bitcoin vs Paypal lawsuit is likely to raise awareness among Investors that Bitpay and other Bitcoin payment processors pose a significant threat to PayPal and, consequently, eBay. BitPay boasted over 15,500 merchants in December, a 50% increase in only 3 months.