Will buying porn turn out to be bitcoin's killer app?

Porn.com has seen sales increase by nearly a quarter since it started accepting payments in bitcoin, leading the site to claim that porn could be the currency's "killer app".

Now the site's owners are offering the domain for sale to anyone who will pay $50m in the digital currency.

Porn.com started taking bitcoin for its premium services in December, and the currency rapidly came to account for 10% of its sales. But in early January, a post on Reddit's Bitcoin subforum took the news viral, and after a spike where the currency accounted for 50% of its sales, the bitcoin trade settled down at 25%.

Some of the increase will be bitcoin fans rushing to support a site that takes their preferred form of payment, but David Kay, the marketing director at Porn.com's parent company Sagan Ltd, argues that there are other reasons as well:

"Privacy and confidentiality are paramount when joining an adult service for the majority. In general you can surf porn.com for free, anonymously but if you want to upgrade to the premium services you have to enter a method of payment which historically has been credit card. In order for the transaction to process you have to include your full name and address. This is not necessary with BTC."

Some aspects of bitcoin are less useful, however. It is currently impossible to set up recurring payments with the currency, making it impractical for subscriptions that renew on a short term basis.

Additionally, while transaction fees are a contentious topic among bitcoin users, when they are levied it is on an absolute basis, rather than a proportion of the purchase: a typical fee of 0.0001 BTC is only economical for purchases of more than around £2. But Kay is not concerned:

"Our experience has been positive using BTC for smaller payments. I think the general public as a whole doesn't yet know that you can spend just a portion of a bitcoin on a purchase. Our customers are using bitcoins to buy premium services and to tip our live performers.

Ever since the conflict between VHS and Betamax, take-up by the porn industry has been seen as key to the success of consumer technologies. One version of tech lore has it that JVC's welcoming attitude towards adult content on VHS was the reason it won out in the end.

Whether or not that was true three decades ago – a more believable explanation is that VHS was the only one of the formats which could hold an entire feature film on one cassette – Kay hopes that it will hold out this time round:

"I definitely believe that porn will be bitcoin's killer app. Fast, private and confidential payments."

The marketing director added that the porn.com business is currently up for sale, "for $50m, payable in bitcoin only. So if I look at the trading amount today, that would roughly be 55,370 bitcoins."

In 2007, porn.com became one of the most expensive domain names ever sold, when Detroit-based MXN Ltd paid $9.5m to buy it.

At the time, only sex.com had sold for more, after an auction in 2005 ended at $12m. The site is ranked by analytics firm Alexa as the 894th most visited website in the world, and the 576th most-visited in the UK.