Every industry includes a variety of participants for the exchange, but for some industries, the complexity can be unprecedented. Only a few trading platforms make use of artificial intelligence and analytic updates in bitcoin trading. For example, finance can include hundreds of thousands of entities interacting through payment systems and logistics.
Bitcoin payments offer the ability to a simple and frictionless transfer of value from one person to another – with near infinite scalability. It offers immense benefits for companies. There are many benefits, too; these include reducing costs, improving efficiency, eliminating long payment chains and costly intermediaries, and improving trust in an otherwise opaque system by offering greater visibility in accounting transactions. Click here for more information and understanding of bitcoin.
The vision of Bitcoin payments has been around for a while, but the reality has been somewhat different. Some companies have implemented Bitcoin payments but have struggled to get market traction. It can undoubtedly be attributed to the technical and regulatory barriers encountered when considering Bitcoin payments. Nevertheless, the current state of affairs has seen some 1 10000 private companies worldwide accept cryptocurrencies as payment. So, let’s discuss the benefits of accepting bitcoin payments:
The benefits of accepting bitcoin payments are clear:
Costless Transactions:
Transactions involving credit cards as well as other payment methods can be costly. There are always transaction costs associated with bank charges that merchants incur. For example, when a customer uses a credit card to purchase something, the merchant gets charged by the bank that issues the card.
The charges involve converting whatever currency the exchange was made into local fiat currencies (fiat currencies mean any government-issued legal tender like dollars or pounds). These charges can vary; moreover, they can be quite high depending on how much money is in question and who issued the card, for example, Visa or MasterCard.
Credit card companies charge a fee of up to 3% for most transactions. The above 3% figure is the average, but this may differ depending on the merchant’s transaction volume and the cost involved in processing the transaction. Considering this to be a simple USD 1 transfer of currency, you can quickly see how high these costs are. The above transactions show how expensive credit card transactions can be. On the other hand, Bitcoin payments offer almost no transaction cost, so they save money in terms of costs involved in ensuring payment is made with a particular currency backed by a blockchain, ultimately ensuring transparency.
Bitcoin Eases International Transactions:
Bitcoin payments allow global transactions to occur at almost no cost; something fiat currencies struggle to achieve. However, this process takes time and resources that are not always readily available to small businesses.
Also, suppose a citizen wishes to use their credit card outside their home country. In that case, currency exchange is used, which means there is always a loss of value involved in converting the currency plus a transaction fee between 3% and 5% on top of the conversion fee charged. Since bitcoin is on P2P, the transactions are directly between the two main parties, the first sender and second receiver, no other parties except the cryptocurrency exchange, if used, and cryptocurrency miners are there. Therefore, even international transactions on the bitcoin network are costless and occur in 10-8 seconds.
Bitcoin incurs no chargebacks:
With a chargeback on credit cards, merchants, banks, and consumers get hit with fees. It is one of the top reasons which have led to the decline in the use of credit cards as an accepted medium and is one of the main factors which have resulted in the fall in popularity of fiat currencies. Since Bitcoin has had no chargebacks, merchants can accept bitcoin payments without any loss of value.
Secure:
Traditional credit card transactions are not secure because there are no mechanisms for merchant protection and other security protocols for bitcoin clients using P2P payments. Also, banks issue plastic or swipe cards which put all the transactional details at risk if data is stolen or lost, etc. Another risk that is often overlooked is the cost of insurance for merchants who are liable for fraudulent transactions.
The traditional credit card system costs merchants about 1.8% to cover fraudulent transactions, which can be as high as $80 per transaction. However, bitcoin is highly secure and transparent simultaneously; the entire data is broadcasted on the blockchain. Undeniably, blockchain is accessible, but it reveals the actual identity of people involved in a transaction and the wallet address of both sender and receiver, alongside the transaction’s timestamp, amount, and cryptographic address.
