Bidding Service BitMit Put Up For Auction

The latest auction listing on the popular Bitcoin-related online bidding service BitMit (@BitMitNet) is unlike any seen on the site before as the high bid for this listing becomes the new owner of the auction site itself.

The operator of BitMit, which is based out of Hong Kong, has determined that it would need a special license to continue offering the service in that jurisdiction and as a result has put the bidding service up for auction to the highest bidder.

BitMit doesn’t just provide an auction listing service, it also provides escrow with arbitration which makes it possible for each listing’s seller to ship after the buyer has committed funds to escrow, and makes it possible for the auction’s winning bidder to inspect the goods received before the escrow payment is released to the seller.

The service’s online hosted (shared) EWallet along with the escrow are regulated activities in Hong Kong as they involved BitMit holding customer’s funds.  

On Friday, forum user tosaki, the operator of BitMit, commented on a BitcoinTalk forum thread explaining that regulators in their jurisdiction require “special licences for businesses which holds customer funds”.  

With BitMit attracting over two thousand unique visitors per day it has become the most visited marketplace where individuals and businesses can list their goods and services in auction format similar to eBay and receive bitcoins as payment.  There are nearly as many visitors from Europe as from America (about 80% of all visitors in total) thanks to the site being available in Italian, Spanish, French, Polish, Czech and Finnish in addition to English.  The translation in Chinese helped the site attain traffic levels from Asia exceed 10% of the total.

BitMit earns a final value fee on successful auction —  currently just about 2% of the winning bid amount.

A dozen bidders have already placed bids for the auction which runs another six days.  The auction is for the domain, brand and source code as well as any installation and support services during the transition.  BitMit’s operator has also offered availability to provide continued technical services to the new owner.

Because the service is operated entirely online, a new owner would likely be able to operate it from a jurisdiction with fewer restrictions.

[Update: There is further discussion about BitMit’s business model and potential alternatives or improvements.]
[Update2: The operator of BitMit has announced that they have found “a solution”.  Details as to if this means the business will have new owners or if some other change will occur has not yet been shared.]

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