Waxy.org
Waxy.org is the sandbox of Andy Baio, an independent journalist and programmer living in Portland, Oregon. I created Upcoming.org and some other stuff too.

Contact Me: log@waxy.org or waxpancake on AIM

Paypal Challenges BitPass

Posted Oct 13, 2003

Paypal has frozen the account of micropayment service BitPass. Scott McCloud, one of their advisors and its most prominent user, stated that Bitpass was given seven days to provide Paypal evidence that their service isn't a violation of the U.S. Patriot Act. Is this because Paypal is genuinely concerned that Bitpass could be used for money laundering, or are they interested in shutting down a potential competitor?

Scott reported this information at this O'Reilly's Foo Camp over the weekend, and doesn't appear to have hit the web anywhere yet. Please let me know if you find any more information about this story.

Update: Abe Burmeister spoke to Bitpass and confirms the report.

October 14, 2003: Paypal employee Patrick Breitenbach posted a comment on my site, stating that Paypal reactivated the Bitpass account this morning. Patrick said that Paypal didn't intend to disrupt payment process, and claimed the decision to suspend their account was unrelated to competitive issues. Though the End of Free points out that their Senior Manager for Biz Dev is speaking a micropayments conference next month.

7 Comments (Add Yours)

Oct 13, 2003
12:06 PM  
Anonymous wrote:

well if its true then not all of their employees have been told yet... should know more soon.


Oct 13, 2003
12:33 PM  
Abe wrote:

Just confirmed the story with Bitpass, they were given notice on Saturday. Bitpass had a standard seller account with Paypal, nothing special. Their service is pretty much unaffected, you just need to charge your bitpass account up with a credit card only. The Bitpass people don't seem to worried, they can go forward without Paypal no problem.

All indications are that Paypal is doing this because they are genuinely scared of Bitpass and acting in one of the only ways they can. Money laundering? At 25 cents a pop? Try again. This is straight business competition, and Paypal is getting dangerously close to engaging in illegal anti-competitive practices.


Oct 13, 2003
6:18 PM  
won wrote:

heh, i already got an account using paypal. suckers.


Oct 13, 2003
7:40 PM  
djspicerack wrote:

wow - this is pretty screwed up, and really looks like eBay/PayPal is taking it to BitPass.... Wonder how this will end up. Thankfully, Homeland Security boss Tom Ridge is at the Sox/Yankees game so they'll get a little reprieve... Wonder where Ashcroft is....


Oct 14, 2003
4:28 PM  
Patrick Breitenbach wrote:

I'm a PayPal employee and wanted to update readers on the status of the PayPal/BitPass relationship. Over the weekend BitPass' PayPal account was suspended pending assurances that BitPass and PayPal were in compliance with the US Patriot Act given the nature of the respective companies' services. PayPal did not intend to disrupt payment processing and we are reviewing our procedures to ensure that this situation doesn't happen in the future. PayPal has been in direct contact with BitPass on the matter and BitPass' account was fully restored this morning. Contrary to speculation, this incident had nothing at all to do with competitive issues and in fact PayPal supports companies such as BitPass, Cybersource and Xoom that are building complementary services.


Oct 14, 2003
10:02 PM  
Abe wrote:

I've confirmed with Bitpass that everything is back in order. The relationship between the two companies seems to be a-ok as far as I can tell.


Oct 18, 2003
3:22 AM  
won wrote:

never doubted paypal for a moment...


 

Leave a comment





Waxy Links
Ads via The Deck
January 6, 2009
The Perils of Zero-Gravity Videography — Matt Harding discovers hard drive-based camcorders don't work in zero-gravity (via)
Screenshot: 4chan hacks MacRumorsLive during Apple keynote — the 4chan thread shows how they found the admin interface, password hashes, and finally cracked a user's password
January 5, 2009
xkcd's Guide to Converting to Metric — even Liberia and Myanmar are mostly metric, compared to the U.S.
Crowdsourcing an Ethical Dilemma — Dolores Labs uses Mechanical Turk to answer the Trolley Problem
January 3, 2009
Stamen's Mike Migurski on extreme programming vs. interaction design — the linked interview is great
January 2, 2009
Jason Scott on the closure of AOL's online communities — like physical evictions, there need to be laws protecting community data in the event of closure
JPG Magazine to stop publishing, turn off website — with only three days notice; here's the response from Derek and the JPG community
December 31, 2008
Wikipedia over DNS — loony hack serves summaries of Wikipedia articles; also available as JSON and JS
Leap year bug caused every 30GB Zune to crash at 2am this morning — as strange as the Android bug that ran every keystroke as root
Metafilter's exhaustive tour of the early origins of Adult Swim — the Cartoon Network breathed new life into old cartoons, while constantly trying to find the next big thing
December 30, 2008
Infochimps' massive scrape of Twitter's friend network — Twitter gave their blessing on sharing the 56-million records, which includes 10M tweets and 220k hashtags
The Lonely Island's We Like Sportz — the sequel to Just 2 Guyz
Niall Kennedy documents the undocumented Google Reader API — whoops, this was three years ago; here's an updated version
Sakurako Shimizu's Waveform Jewelry — the "I Do" wedding band and Atari chip ring are cute, too
Fimoculous' 30 Most Notable Blogs of 2008 — an incredibly well-researched list, with related recommendations for every entry
December 29, 2008
DJ Earworm's United State of Pop 2008 — mashing up the top 25 singles of the year into a single song and video
Twit 4 Dead, four Twitter bots fight zombies in real-time — watch their collected activity here
Facebook sentiment mining predicts presidential polls — like StateStats, Facebook Lexicon is tons of fun
Giganews reports Usenet upload growth since 2001 — note this doesn't reflect Usenet popularity, but most likely the rise of huge Blu-Ray and HD rips
December 28, 2008
List of Starbucks employee jargon — culled from the Starbucks Gossip blog
December 27, 2008
Rocketboom covers the history of the Lip Dub — the Know Your Meme series is consistently well-researched and fun to watch
Jennifer 8. Lee on the history of General Tso's Chicken — different cultures each localized their own versions of Chinese food around the world (via)
Top 20 freeware games released by Cactus, this year — is Jonatan the most prolific game developer alive?
December 26, 2008
Paul and Storm finish their 25 Days of Randy Newman — hosted on Bandcamp, and now with the solo piano track used in each song
AutoPager, infinite scrolling for Firefox — love the idea, but too clunky for everyday use (via)
December 24, 2008
Net Cafe archives, dot-com nostalgia TV show from 1996-2002 — Sergei Brin in 2000 at the newly-opened Metreon, Mondo 2000 and Boing Boing, awkward Webby broadcasts, and hundreds of dead dot-coms (via)
The Offworld's best indie and overlooked games of 2008 — also: Gamasutra's top 5 indie games
Left 4k Dead — lo-fi zombie shooter in 4k of Java (via)
NORAD's Santa Tracker on Twitter — they just passed through Kazakhstan; also tracking on Google Maps and in 3D on Google Earth
December 22, 2008
ScummVM adds support for 7th Guest — I didn't realize they expanded into non-Scumm engines last year, including the Sierra AGI games

Andy Baio lives here. Some rights reserved, for your pleasure.