In the latest endorsement of the growing role for Bitcoin, business listings on Yelp will now indicate if a merchant accepts the digital currency as a payment method.

The reviews site and mobile application is adding the new attribute to its business listings as another way to make them more useful for consumers and businesses. The move is Yelp’s latest attempt at differentiating itself in the increasingly competitive location-based services space.

“As a payment mechanism, Bitcoin is still relatively small but it has a certain niches,” said Pradeep Moudgal, director of emerging technologies at Mercator Advisory Group. “There are companies from small coffee shops to others who have been experimenting with it as a payment type.

“They are accepting it but to a larger extent it is an experiment,” he said. “They are not having tons of volume coming through.

“These pilot programs are all over the world, but it is a case here and a case there.”

Digital currency
Bitcoin is a digital currency that enables consumers and businesses to make payments from any Internet-enabled device.

Yelp’s decision to include Bitcoin acceptance in its listings is a reflection of the growing number of consumers and businesses that are embracing bitcoins as a payment method. Some of the businesses supporting Bitcoin payments include Square, Lord & Taylor as well as a number of local merchants including coffee houses and bars.

As mobile adoption continues to grow and evolve, Yelp is making sure it remains to relevant to users.

Another way that Yelp is trying to differentiate itself is by adding ordering services to its mobile site and applications, which were introduced last year. The online rating site launched Yelp Platform to let consumers order from local restaurants and merchants (see story).

Early days
Bitcoin is gaining steam because it offers some benefits over other payment methods. For example, bitcoins enable transactions without the use of sensitive data such as a credit card number. Additionally, Bitcoin can be a lower-cost alternative to credit cards in terms of processing fees for businesses and interest charges for consumers.

According to recent report from Mercator Advisory Group, Bitcoin is thriving because it is a decentralized offering with no one organization or centralized entity attached, enabling it to be transparent and involve fewer hassles for buyers and sellers. However, as the currency gains in popularity, a growing number of countries are looking at ways to regulate Bitcoin.

“I think Bitcoin will survive in the long run despite some of the technical issues, but there is going to be regulatory oversight and once that happens, it diminishes some of the anonymity,” Mr. Moudgal said.

“There are going to be use cases that will still create some excitement in the marketplace,” he said.

“There are some people who are really pushing it despite all the turbulence and they are betting on widespread adoption. There is still a long way to go before it reaches the kind of success of cash or credit cards.”

Final Take
Chantal Tode is associate editor on Mobile Commerce Daily, New York