Cryptocurrencies were born to facilitate digital payments, and ecommerce seems to be increasingly believing in them and aiming for crypto adoption. Blockchain technology is revolutionizing the way we all pay and transfer money. According to BitPay, more than 100,000 merchants worldwide accept cryptocurrencies:
Wikipedia accepts donations in Bitcoin; Microsoft allows the use of Bitcoin to top up accounts; Burger King, KFC and Subway accept Bitcoin as payment for their products.
There are casinos in Las Vegas where customers can exchange Bitcoin for cash to bet on the tables or later convert their winnings into Bitcoin.
There are some Bitcoin ATMs where it is possible to convert a currency into Bitcoin or withdraw Bitcoin for cash in the local currency.
The benefits of adopting crypto as a payment method
Blockchain-based payments (in their most common form) are recorded on a decentralized ledger. This means that every single transfer of value that occurs between two different accounts (i.e., public addresses or wallets) is recorded on a single ledger that functions by transmitting each transaction to the rest of the network, waiting for the blockchain network to confirm the validity of the transaction.
The noteworthy technological and business aspects of blockchain network payments see:
- Authorization: the user (i.e., the consumer) is responsible for authorizing the payment. This gives the consumer the responsibility to: set the correct amount, provide the correct address, authorize the payment and transmit it to the network.
- Confirmation: the consumer must pay a certain fee amount and wait for a transaction validity period.
Consumers can already shop on various e-commerce sites , where they can pay in Bitcoin to buy luxury goods such as watches, jewelry and various highly exclusive products. Right now, the luxury industry is one of the main ones to adopt cryptocurrencies as a new payment method.
The reason is very simple, cryptocurrencies offer significant advantages over traditional payments, funds can be transferred anywhere in the world within minutes and securely. Transaction fees are significantly lower than traditional payment methods (with a purchase of thousands of dollars, a small one-time payment of five dollars is nothing compared to the exorbitant fees to be paid otherwise).
Luxury customers and retailers have serious fraud problems because of the average purchase amount. The level of security provided by blockchain removes the risk of chargebacks because transactions cannot be reversed.
Countries accepting Bitcoin and crypto as payment
There are indeed many countries adopting Bitcoin and crypto as payment methods.
As a result, people’s interest in where and how to buy crypto is growing significantly. There are different sites and platforms that provide people with different services. Therefore, people need to research and see what are the main advantages of getting cryptocurrencies through a certain platform.
In Europe, Switzerland is the top country among those that allow people to use BTC for business and tax purposes. While the United States in America is the country that allows the most cryptocurrency payments. Here is the list of other countries engaged in using crypto as a payment method:
- El Salvador,
- United States,
- South Africa,
- South Korea,
- and many others.
From various perspectives, paying with cryptocurrencies is a better option for making purchases than paying with fiat money. It is obviously a great opportunity for people who do not have access to other payment or transfer methods.
Those who already earn (e.g., salary, mining, etc.) income in cryptocurrency are potential crypto-consumers. On the other hand, many prefer it for privacy and security issues, while some want to avoid middlemen.
Most have an innovative spirit and like to adopt new technologies, including those involving cryptocurrencies. Despite the invaluable advantages and high potential, there are some disadvantages, including high confirmation times, fees, value instability, and unavailability of stores/products.
Crypto-consumers tend to tolerate this to a small extent, but not entirely. As for delays and fees, we see that the race is absolutely still on.
Different blockchains and currencies are competing to take over the shopping and small transaction space.
Lightning Network is the first case of a scalable network offered to users to make cryptocurrency payments for purchases. It is only available for Bitcoin transactions, and although it is appreciated by many, there is limited adoption of this technology.
The growth is driven by users trying to overcome the cost of using their Bitcoin, but also by newer generation Lightning wallets that are easier to use, and perhaps in part by the efforts of stores like CryptoRefills in educating their users.