Was cryptocurrency created to replace fiat currency? This is a common question asked by many new cryptocurrency investors. While we can only speculate about the answer, cryptocurrency has come a long way. Since its inception in 2009, with Bitcoin as the first digital asset, digital currency has quickly been adopted in various sectors including the ecommerce space. Today I have given my opinion on the use of cryptocurrency in E-commerce sector, I have concluded some facts also from giant retailers and Paypal adding the crypto features.
What makes cryptocurrency unique is its ability to eliminate third parties such as banks, making it a safe and fast way to conduct transactions online. The future of cryptocurrency in ecommerce is still developing; however, there is hope as the technology behind cryptocurrencies continues to evolve rapidly. Let’s take a look at whether cryptocurrency is the future of ecommerce.
A Brief Overview of the Rise of Cryptocurrency
The rise of cryptocurrency has taken a clear path since the introduction of Bitcoin in 2009. Bitcoin, the pioneering cryptocurrency, introduced the concept of decentralized digital currency and blockchain technology to the world.
The uniqueness of cryptocurrency is its ability to bypass traditional banking institutions, dramatically decreasing transaction fees and processing delays. This makes it a perfect solution for modern, fast-paced transactions, offering a streamlined and efficient way to handle financial matters.
Moreover, the ability to buy and withdraw crypto instantly has further enhanced its appeal in the financial sector, making it the perfect solution for individuals and businesses seeking swift and hassle-free transactions.
How Cryptocurrency Is Changing the Ecommerce Landscape
Cryptocurrency is steadily changing the ecommerce landscape by providing users with a fast and secure way of making payments online. It enables global transactions without the burden of currency exchange, therefore boosting the international reach of ecommerce firms.
Cryptocurrency also affects the financial management practices of businesses in various ways; for example, it reduces transaction fees while ensuring secure and dependable payment methods for customers. Blockchain technology, on the other hand, empowers businesses to establish immutable ledgers, enabling real-time tracking of all transactions. This capability simplifies recordkeeping, ensures accuracy, and aids in compliance with governmental regulations.
PayPal Adding Support For Bitcoin & Cryptocurrency Features
- In October 2020, PayPal announced it would allow users to buy, sell, and hold bitcoin and other cryptocurrencies directly through PayPal digital wallets. This was a significant move as PayPal has over 300 million users worldwide.
- PayPal’s move provides easier access to cryptocurrency transactions to mainstream consumers and businesses. Before, crypto purchases often required sign-ups on specialized exchanges. PayPal’s integration makes crypto more familiar.
- Users are not able to transfer cryptocurrency holdings out of PayPal currently. This limits users’ ability to send crypto p2p or to external wallets. PayPal is functioning more like a centralized brokerage.
- PayPal’s cryptocurrency services are available in the US and UK initially, with plans to expand to other markets in 2021. The large user base gives crypto greater potential adoption.
- Businesses accepting PayPal can now also indirectly accept cryptocurrency as payment. This aids adoption as merchants don’t have to setup new integrations specifically for crypto.
- PayPal’s move shows wider trust in the legitimacy and staying power of cryptocurrencies by a major payments provider. But full acceptance still has challenges to overcome.
Benefits of Cryptocurrency in Ecommerce
Cryptocurrency can offer several benefits to the ecommerce sector, making transactions more efficient, secure, and accessible. Here are some advantages to using cryptocurrency in ecommerce.
- Reduces transaction fees and increases efficiency – One of the primary advantages of using crypto for ecommerce transactions is that it lowers transaction costs while increasing efficiency. Unlike traditional payment systems, cryptocurrency does not rely on middlemen to complete transactions. This reduces costs and commissions paid by online firms as well as processing time and the risk of chargebacks or fraud. Furthermore, cryptocurrency can enable cross-border transactions without currency exchange or exchange rate volatility issues, allowing online businesses to increase their worldwide reach and consumer base.
- Promotes privacy – Cryptocurrency is highly known for its privacy features, which allow users to make transactions without revealing their identities. This level of privacy not only safeguards customers’ sensitive information but also enhances their overall security and trust in online transactions.
Is Crypto the Future?
The number of online retailers accepting cryptocurrency as a payment method is still small, but it is growing. Cryptocurrency will not be universally accepted overnight. It will take time for people to understand the concept and how it will benefit them.
- Overstock.com – One of the first major retailers to accept cryptocurrencies like Bitcoin and Ethereum for purchases.
- Newegg – Large online electronics retailer that accepts Bitcoin, Bitcoin Cash, Ethereum, Litecoin, and Dogecoin.
- DISH Network – Satellite TV and Internet provider that started accepting Bitcoin payments in 2014.
- Microsoft – Users can buy apps, games, and other digital products with Bitcoin.
- AT&T – Mobile carrier that provides an option to pay bills with cryptocurrency.
- Twitch – Popular live streaming platform that accepts Bitcoin and Bitcoin Cash payments.
- CheapAir – Travel booking site that accepts payments in Bitcoin, Bitcoin Cash, Ethereum, Litecoin, and Dogecoin.
- Rakuten – Japanese e-commerce giant that owns Buy.com and accepts Bitcoin.
- ExpressVPN – VPN provider that accepts Bitcoin, Bitcoin Cash and Ethereum for subscriptions.
- Cratejoy – Subscription box service enabling cryptocurrency payments through Coinbase Commerce.
- NordVPN – VPN provider that accepts cryptocurrencies like Bitcoin and Ethereum.
- Shopify – Ecommerce platform that allows merchants to accept crypto payments through integrations.
- Starbucks – Mobile app lets customers reload accounts with Bitcoin and Bakkt’s digital asset wallet.
- Etsy – Ecommerce marketplace that enables Bitcoin and Ethereum payments for sellers.
- Home Depot – Retailer testing cryptocurrency payments for online orders with BitcoinPay.
To help encourage a greater acceptance of cryptocurrency in the ecommerce landscape, people should be educated on what it is, how to carry out transactions, and its advantages. As more consumers become familiar with cryptocurrencies and their potential advantages, the acceptance rate among online retailers is likely to grow further, leading to a significant evolution in the ecommerce landscape.
Cryptocurrency is becoming a game changer in the ecommerce sector, providing shoppers with a fast and secure way to transact online. The future of cryptocurrency in ecommerce is rapidly approaching us. Time will only increase its adoption.