4 Steps to Accept Cryptocurrency for Your Online Store

The exponential rise in popularity of Bitcoin and other cryptocurrencies has become impossible to ignore. Currently, the estimated number of cryptocurrency owners stands at 300 million worldwide. In addition, the value of crypto transactions stands at $ 120 billion per day. These stats – which are expected to continue to rise – underline the importance of this digital currency in the modern world. Consequently, all business owners should at least exploit the potential of cryptocurrency in ecommerce, with a view to implementing it as a payment option.

WHAT IS THE POSITION OF CRYPTOCURRENCY IN ECOMMERCE?

Cryptocurrency is a (web 3) decentralized digital currency first introduced in 2008 by Satoshi Nakamoto. The value of crypto is that it is not centrally regulated by the government or any central body. Instead, trading takes place as peer-to-peer transactions performed on blockchain technology. In 2022, the global size of the cryptocurrency market will be $ 1.8 billion. Undoubtedly, the influence on the financial world is increasing, but what is the role of cryptocurrency in ecommerce?

As it stands, crypto is now a viable payment option for Ecommerce transactions. Platforms like Shopify and WooCommerce now accept payments in digital currency. Bitcoin is expected to be the most widely accepted, but Ethereum, Ripple and Binance Coin are popular alternatives. However, the adoption of cryptocurrency in ecommerce is far from universal as many brands, especially Amazon, do not want to accept this method.

WHAT ARE THE BENEFITS OF CRYPTOCURRENCY IN ECOMMERCE?

CHEAPER TRANSACTION COSTS

Perhaps the biggest argument for using cryptocurrency in ecommerce is the relatively lower transaction costs. Transactions processed through banks, credit cards and online payment platforms typically incur fees ranging from 1 to 5%. In contrast, the fees for Bitcoin transactions are limited to a maximum of 1%. Therefore, it has a strong potential to increase the profit margins of companies.

ENCOURAGES INCLUSIVITY

As mentioned before, digital currency holdings are growing rapidly. Therefore, the introduction of cryptocurrency in ecommerce stores offers an opportunity to attract more customers who prefer such payment options. In some countries, cryptos have become so popular that they are becoming the first choice for the population. This trend may continue worldwide. With Crypto you therefore reach an additional target group of buyers.

FASTER TRANSACTION SPEEDS

Compared to credit card or debit card payments, crypto transactions are processed faster. This is a major reason for the increasing use of cryptocurrency in ecommerce websites by retailers who want faster settlements. Interesting is that Bitcoin the slowest cryptocurrency is with 7 TPS. However, there are much faster alternatives, including Monero, Ripple, and Solana.

REDUCED SAFETY RISKS

The decentralized nature of cryptocurrencies means that less fraudulent activity takes place. Users' data is stored in crypto wallets, making it very difficult to steal. Thus, using cryptocurrency allows for more secure transactions, which many customers will appreciate.

FACILITATING INTERNATIONAL TRANSACTIONS

By using cryptocurrency in ecommerce stores, retailers can encourage customers to make purchases in different currencies. Rather than limiting them to paying in your local currency, your company could offer the alternative of paying in crypto, which is more universally accessible.

WHAT ARE THE DISADVANTAGES OF CRYPTOCURRENCY IN ECOMMERCE?

PRICE FLUCTUATIONS

The inconsistency of the exchange value of most coins is the biggest obstacle to using cryptocurrency in ecommerce. In 2022 alone, Bitcoin was as high as $ 60,000 and as low as $ 18,000, with serious consequences. For example, a significant drop in price value means that retailers incur losses on goods sold when converting the money to fiat currency. Undoubtedly, such transaction uncertainties are bad for business. Therefore, online stores must consider coin stability before using certain coins. However, developments in this area are moving very fast. There are now possibilities to make transactions in real-time calculated exchange rates and to immediately receive the amount in the desired currency credited to the traditional bank account.

NEGATIVE PUBLIC OPINION

Although the number of crypto users is increasing, more people are distrusting these coins. There are several reasons for this perception, including limited regulation.

HOW TO ACCEPT CRYPTO CURRENCY IN ECOMMERCE STORES?

Accepting cryptocurrency on ecommerce websites is easy and can be summarized in 4 steps:

#1: MEET THE NEED FOR THIS PAYMENT OPTION

The sales department of all companies can conduct analytical research on how accepting cryptocurrency in ecommerce stores will affect finances. Your company can also research how much customers are willing to pay with crypto.

#2: RESEARCH COINS, WALLET AND GATEWAY OPTIONS

If cryptocurrency is to work effectively for your business, it's best to carefully consider your options. Cryptocurrency in e-commerce can be affected by coin stability, transaction speed, transaction costs, etc., and all of these must be taken into account.

#3: CHOOSE WALLET OR PAYMENT GATEWAY

A crypto wallet stores the coins, while a payment gateway facilitates the conversion of the coin to dollars or preferred currency. Alternatively, many platforms offer both wallet and payment gateway services.

#4: INTEGRATE CRYPTO PAYMENT INTO YOUR WEBSITE

Cryptocurrency in ecommerce websites can be integrated using an API.

In conclusion, cryptocurrency in Ecommerce is still a new concept that should be approached with caution. The advantages are quite enticing, but the disadvantages should not be overlooked. The concept of cryptocurrency as a means of Ecommerce payments is still evolving, but the potential remains exciting.