Cryptocurrency and eCommerce complement each other so it is no wonder that the use of cryptocurrency for online shopping is growing with each passing day. Ecommerce retailers look at cryptocurrencies as an additional option for those people that are searching for a fast and convenient way to pay for goods and services.
It is no surprise to see the high demand for digitally-based payments among an online customer base since using cryptocurrency for online shopping means that you don’t have to go to the bank, withdraw money, or even enter your credit card number before submitting a payment.
With eCommerce sales in the United States expecting to increase by almost 30% this year, many problems related to eCommerce platforms are starting to show:
A revenue share that retailers have to pay ranges between 10% and 50% of the product price.
- Limited communication between merchants and customers is making it hard to build brand awareness and loyalty.
- Since retailers have to cover their extra expenses, they are forced to increase prices, which means that shoppers have to pay more.
On the other hand, using blockchain technology for eCommerce makes up for these flaws as it allows for decentralized marketplaces with transaction charges close to zero. This means lower prices for online shoppers, better conditions for online merchants, and the list goes on and on.
Benefits of using cryptocurrency for online shopping
This is probably the biggest advantage for people that use cryptocurrency for online shopping. Each business transaction goes through a network of suppliers, credit cards, banks, and payment systems. Naturally, every link in the chain takes its share, which inflates the prices of goods and services that you pay for. With blockchain technology, you no longer have to pay for 3rd party agents. You make safe, cheap, and fast single-rank transactions. Let’s take PayPal as an example. When using this payment method, merchants have to pay fees which range from 2.9% to 3.5% per transaction, and some of them can even reach 7% for a single online order. To make up for the loss, merchants usually pass these fees down to the buyers which leads to unnecessary inflation of prices. In order to get rid of these unnecessary expenses, sellers are going for alternative banking services like blockchain.
Since there is a great number of interested parties involved in every online transaction, the process is slow and quite complicated. One day this may sound strange, but the fact is that it takes up to 3 business days to receive a payment. With the decentralized approach, you are leaving all the agents aside and the process speeds up. When using cryptocurrency for online shopping, the processing time is less than a couple of seconds.
The blockchain’s system of distributed ledgers guarantees the transparency of the process. This is great for eCommerce since data become accessible so you can track every bit of info. While markets and brands keep the data to themselves and even charge for it, blockchain allows running analytics for free. With every action registered, blockchain technology guarantees transparency and builds trust among its users.
With the decentralized nature of blockchain technology, you can rest assured that your online trade is secure. Since data can not be modified, the possibility of fraudulent transactions is zero. Besides standard password settings, users are assigned a specific number of random code words called SEED. This is a backup phrase that is used to create public and private keys, as well as the addresses for transactions in the future.
Each public address your wallet generates stems from your wallet’s xPub (Extended Public Key). Every time your public address receives a payment a new address is automatically generated. This improves privacy since if you were to use the same address for every payment you receive it would be easy for anyone to track your payment history.
A SEED phrase is a list of random words generated by the software which stores all the information you need to recover your funds in case your computer breaks or your hard drive becomes corrupted. If anybody discovers this phrase, they can steal your cryptocurrency, so it is of utmost importance to keep it safe and hidden from curious eyes.
Accepting cryptocurrency as a payment method will open the gates to a whole new market of tech-savvy customers. If you choose to provide your buyers with an option to pay through a digital wallet, you will be able to broaden your market and appeal to the crypto community of consumers all across the world.
How to accept payments in cryptocurrency
You can accept payments in your eCommerce store either through your personal wallet or through a 3rd party payment processor.
To accept payment through your personal wallet you need to download a virtual wallet. You can download most wallets to your phone or computer, or get a hardware wallet, a security device that stores your private key.
You can also use a 3rd party payment processor like Coinbase or BitPay. They will handle the entire payment process like credit card payment processors do. The main benefit of this kind of wallets is that they can instantly convert the cryptocurrency into fiat, saving you from any price volatility.
Since its emergence, blockchain technology took the world by storm and has rapidly found its place in many industries. Due to all the advantages that blockchain offers, cryptocurrency for eCommerce is slowly becoming a standard in online shopping. Safex is a decentralized blockchain technology engine for eCommerce. It is a user-oriented marketplace that maximizes the retailers’ profit while keeping buyers happy with low prices. Safex also respects your rights and privacy and doesn’t collect personal information. Safex mining makes the system profitable, not your data. Contact us and open your eCommerce account to start accepting cryptocurrency payments on a secure marketplace.