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Is It Wise for E-Commerce Stores to Accept Crypto As Payment?

Everyone is aware of crypto these days. Once obscure, these digital assets are rapidly integrating into the mainstream, particularly in the realm of e-commerce. The industry is predicted to grow from its previous perception as a niche investment for tech enthusiasts to $2.9 billion by 2030.

The increasing digitisation of various aspects of life demands the recognition of virtual currency as an authentic asset, not merely a passing fad. This article will examine why the e-commerce industry is open to accept crypto as a viable payment solution, as well as what benefits it presents.

Potential of Crypto Payments

The unpredictable adoption rates of cryptocurrencies make it challenging to estimate the size of the market. The Global Crypto Adoption Index indicated that adoption peaked in Q2 2021. However, affected by economic concerns and market instability, cryptocurrency ownership proceeded to witness significant fluctuations.

According to stats, adult crypto ownership rates in the United States fell slightly from 33% in 2022 to 30% in 2023. However, with 60% of respondents saying they are familiar with the idea, there appears to be a good chance that the use of digital currencies will rise as technology becomes more widely available.

Though, the use of cryptocurrency is still quite low. According to the same survey, 38% of cryptocurrency users were lured to the technology, whereas only 13% of users bought crypto for usage in online transactions.

E-commerce aims to overcome the drawbacks of conventional payment methods to enhance the consumer experience. As the needs for online commerce change, cryptocurrencies present a viable way to conduct transactions more quickly. This and decreasing trust in conventional institutions suggest that future perceptions and usage of cryptocurrencies may change.

Advantages of Cryptocurrency in E-Commerce

Using cryptocurrency for payments gives e-commerce companies a number of advantages over competitors:

Improved Global Reach

E-commerce sites can reach a wider audience worldwide with cryptocurrencies. Conventional payment options are not always accessible everywhere and may have regional limitations. Companies looking to conduct cross-border business often choose to use cryptocurrencies because of their ease of use and absence of global regulation.

Lower Expenses

Businesses can avoid the high fees associated with using credit cards by accepting cryptocurrencies. Customers and businesses may save money as a result of the typically lower fees connected with digital asset transactions, which would cut the price of goods and services.

Greater Safety

Transactions using cryptocurrencies are highly secure since they are decentralised. As a transaction is almost impossible to undo after completion, the likelihood of fraud is greatly decreased. Adopting blockchain technology provides an extra layer of protection against chargebacks and fraudulent actions, protecting merchants and customers in the online marketplace.

Cryptocurrency Applications in E-Commerce

With cryptocurrency, a wide range of e-commerce applications are feasible:

Loyalty Programmes: The innovative and safe benefits that customers may now enjoy as a result of blockchain technology increase the allure of loyalty programmes. Benefits like loyalty tokens are ensured to be fair and secure due to the immutability of blockchain technology, which increases engagement and confidence.

Web 3.0 and Metaverse: With its immersive purchasing experience, cryptocurrency is a key component of both Web 3.0 and the metaverse. It enhances user engagement by facilitating transactions for virtual money and collectables.

Supply Chain Transparency: Supply chain integrity and product manufacturing can be transparently verified by using blockchain for tracking. This highlights a brand’s dedication to integrity in the fight against fake goods and unscrupulous business methods.

Specialised Marketplaces: With the emergence of virtual assets, specialised peer-to-peer networks marketplaces have been established. These platforms give merchants new chances to reach larger audiences and increase their market presence by providing safer transactions and lower operating costs.

Final Remarks

Companies that accept crypto as payment have a unique opportunity to gain a lot from this technology and other innovations in the industry. In addition to the advantages mentioned earlier, using cryptocurrency for payments has enormous potential to grow the e-commerce sector.

Image source: Shutterstock

Alibaba Moves to Expand Its Scope For Its Blockchain-powered Charity Project

Ant Financial, an affiliate of Alibaba the e-commerce giant is making efforts to increase the scope and accelerate its charity project which happens to be a blockchain initiative.

Alibaba announced that it will make use of blockchain to protect third parties who donate money to charity. The project was revealed last summer with Ant Love, Ant Financial’s charity arm in charge.

The company also said that it was making use of this technology in order to ensure that transparency is brought into the system. The platform was specifically designed to increase the level of access into information such as disclosure of charity, histories of donors, and other necessary details needed to make this quest achievable.

The CTO of Ant Financial, Cheng Li told Bloomberg, “We hope to bring more transparency to charity and blockchain technology’s decentralized nature fits that purpose well. It means that all the information and transaction history of funds will be more reliable and can’t be easily tampered with.”

According to a report by the South China Morning Post, Ant Financial also has the intention of bringing in more companies, donor organizations, media groups as we as other charity organizations.

Judging by the scope of Alipay, Alibaba’s e-payment platform, the project is said to be a very notable one, with over 450 million users recorded as last year and the worldwide influence which Alibaba holds.

Image via Shutterstock

Nearly 70% of Merchants Believe Crypto Payments will Revolutionize Business Models, Study Shows

The appetite for cryptocurrencies in e-commerce continues to gain steam as they offer more convenient and safer payment methods, according to a report by global payments solution provider Checkout.com.

Based on a study entitled “Demystifying Crypto: Shedding light on the adoption of digital currencies for payments in 2022 report,” Checkout.com invited 3,000 merchants and 30,000 consumers spread across 11 countries for this survey.

The study scrutinized sentiments and behaviours pertaining to commercial activities using cryptocurrencies.

More merchants have an inclination towards cryptocurrencies based on ease of use and the speeds rendered. Per the report:

“Almost 70% of the merchants surveyed believe that the speed with which crypto payments can be made and settled has the potential to revolutionize their business models—with over 80% of merchants with existing crypto-payment options saying it was easier to settle than using fiat currencies.”

Merchants are already feeling the impact of cryptocurrencies based on Visa findings released earlier this year. The payment giant noted that payments associated with its crypto-linked cards skyrocketed to $2.5 billion during its fiscal first quarter of 2022. This represented 70% of the firm’s crypto volume for the entire 2021 fiscal year.

The growing crypto appeal among younger users

According to Checkout.com findings, crypto was appealing to younger users, given that 40% of consumers aged between 18 and 35 years planned to utilize cryptocurrency payments next year.

This surged from less than 30% recorded last year, signifying a substantial shift in attitude from crypto being solely an investment vehicle to a way of undertaking business regularly.

Jess Houlgrave, Checkout.com’s head of strategy for crypto, stated:

“We believe this is the largest consumer survey of its kind, and the findings present a clear evolution of attitudes towards cryptocurrencies around the world. This is a legitimate transition from the early adoption phase to one that’s more practical, pragmatic and positive overall.”

The report suggested that increased crypto acceptance at consumer levels influenced the way large corporations viewed digital currencies.

More than a third of the respondents, including corporate treasurers and CFOs, showed an interest in having stablecoins on their balance sheets as decentralized finance (DeFi) method for treasury management.

Shopify Inks Deal with Strike, Enabling Bitcoin Lightning Payments

Merchants on Shopify, a global e-commerce giant, will have the option of receiving Bitcoin (BTC) off-chain payments through the Bitcoin Lightning Network after sealing a deal with Strike.

As a leading digital payments platform built on Bitcoin’s Lightning Network, Strike will enable Shopify merchants to receive off-chain transactions, which are readily confirmed, faster, and cheaper than those processed on-chain or Bitcoin mainnet.

Jack Mallers, the founder and CEO of Strike, noted that the strategic partnership would easily enable Shopify merchants to accept Bitcoin payments as dollars.

He added:

“The Lightning Network is a global payments network that lowers costs, enhances speed, drives innovation, improves financial inclusion, and brings the power of choice to consumers and merchants.”

Through Strike’s integration, Shopify merchants will be able to expand their existing payment options. As a result, they will utilise the potential purchasing power among global markets.

Per the announcement:

“Strike’s integration also allows Shopify merchants to generate savings through low-cost payment processing.”

The partnership is also seen as a stepping stone towards reducing various complexities merchants face when holding BTC, given that their Bitcoin payments will be instantly converted to dollars.

With the Lightning Network (LN) being a layer two scaling solution on the BTC network, micropayment channels are used to enhance the blockchain’s capacity to undertake transactions more efficiently.

A previous study by Arcane Research noted that the Lightning Network could radically change the business model of content providers in gaming, video, audio, and many more categories by providing a structure where continuous micropayments are made.

Therefore, Arcane Research foresaw a situation where the Lightning Network would transit from online services to everyday use.

Blockchain in Supply Chain Market Anticipated to Top $14.88 Billion by 2028

The increasing adoption of product traceability for enhanced transparency in manufacturing processes and the urge for optimized security will make blockchain in the supply chain market surpass $14.88 billion by 2028, according to a report by Research Dive.

The study noted that the compound annual growth rate (CAGR) would be 57.4% during the forecast period between 2021 and 2028.

The deployment of blockchain technology in e-commerce websites has spurred growth. It is expected to revamp the supply chain market in the coming years by rendering product traceability, quality control, and transparency in manufacturing processes.

The pandemic has made e-commerce websites increase, and this has been made a reality by technologies like machine learning (ML) and artificial intelligence (AI).

Per the report:

“By application, the product traceability sub-segment of the blockchain in supply chain market is anticipated to be the fastest-growing and reach $3.38 billion by 2028.”

The study noted that significant opportunities are availed by the need for automated, efficient, and transparent supply chains, and blockchain technology is expected to fill this void.

The Asia-Pacific area is anticipated to be the fastest-growing region by amassing revenue worth $4.063 billion. The study acknowledged:

“Increasing technological advancements and growing adoption of blockchain technology by leading organizations of this region to make supply chains more robust have been the main factors behind the growth of blockchain in supply chain market in the Asia-Pacific region.”

According to the report, some of the prominent market players of the blockchain in the supply chain market include Oracle, Microsoft, Huawei, TIBCO Software, AWS, Huawei, and IBM.

Nevertheless, the research pointed out that the lack of awareness about blockchain technology might be a stumbling block in the speculated growth.

Meanwhile, the global blockchain technology market is anticipated to reach $19.9 billion by 2026 from the current $3.4 billion value, according to market research publisher Global Industry Analysts Inc.

eBay Joins the NFT Space, Offering Traders a Seamless Experience

E-commerce giant eBay has entered the non-fungible token (NFT) sector through a strategic partnership with Web3 company OneOf.

eBay’s exclusive NFTs will include animated and 3D interpretations of iconic athletes highlighted on Sports Illustrated covers in the past years.

To offer high-value items and heightened passion to the eBay community of buyers and sellers, NFTs emerged as an ideal stepping stone, according to Dan Block, the VP of Collectibles, Electronics, and Home at eBay.

Block added:

“NFTs and blockchain technology are revolutionizing the collectibles space, and are increasingly viewed as an investment opportunity for enthusiasts. Through our partnership with OneOf, eBay is now making coveted NFTs more accessible to a new generation of collectors everywhere.”

With 142 million buyers worldwide, eBay is the second-largest e-commerce player after Amazon and seeks to render more economic opportunities through cutting-edge technologies like NFTs.

Lin Dai, OneOf’s CEO, pointed out:

“You don’t have to be a crypto expert to buy, sell, and collect NFTs. OneOf and eBay are bringing transformative Web3 technology to the next 100M non-crypto-native mass consumers.”

The NFT collection will comprise 13 limited editions, classified as green, gold, platinum, and diamond.

Wayne Gretzky, a Sportsman of the Year, noted:

“Forty years ago, I was grateful to be on the cover of Sports Illustrated, it was a monumental moment in my life. I’m honored to bring this collectible experience to my hockey fans who have followed my career for decades.”

E-commerce players continue entering the crypto space based on the opportunities rendered. A recent study by Checkout.com highlighted that nearly 70% of merchants view crypto payments as game-changers needed to revolutionize business models.

Shopify Launches Blockchain Commerce Tools to Enhance User Experience

E-commerce giant Shopify, which is crypto-friendly, has released a suite of blockchain commerce tools with the intention of improving the customer experience of its Web3-focused businesses that are housed on the platform.

Particularly noted are the improved functionality for connecting crypto wallets and the “tokengating” application programming interface (API) tools. The latter was previously exclusively accessible to a limited number of retailers until it entered early access beta access mode in June 2022.

Through the use of tokengating, relevant Shopify merchants now have the ability to build up their businesses in such a way that they may choose which tokenholders have access to exclusive items, nonfungible token (NFT) drops, and advantages and which do not.

The application checks a user’s eligibility by using the associated wallet, and it is being marketed to NFT Merchants as a convenient method to reward certain customers or add an element of exclusivity to certain items.

Shopify has merged with the sign-in with Ethereum (SIWE) protocol, which is led by the Ethereum Name Service (ENS) and the Ethereum Foundation. This integration enables Shopify to provide enhanced support for cryptocurrency wallets.

SIWE enables secure user sign-ins and authentication of Ethereum accounts and ENS domains without giving away private identifiers to third parties such as names, phone numbers, and residential addresses. Essentially, SIWE makes it possible for users to securely sign in and authenticate themselves to Ethereum accounts and ENS domains.

In the past, Shopify has had some issues when it comes to protecting the privacy of its customers’ information. Concerning a significant breach of user data that occurred in 2020, a group of dissatisfied customers filed a class-action lawsuit against the company and the vendor of hardware wallets, Ledger, in April of 2022.

“The statementGenerator prop gives you the ability to modify the statement that is shown whenever a Sign-In with Ethereum message is presented. According to the paper, “the function gets the address of the wallet that has linked, which enables you to extend and adapt your message statements so that they are more aligned with your brand.”

At this stage, once a merchant hooks up the SIWE feature on Shopify wallet connect, it appears that users will be able to click a “sign-in with Ethereum” button to connect their addresses via SIWE’s partnered intermediaries such as Coinbase, Fortmatic, WalletConnect, Portis, and Torus. This is something that users will be able to do once the merchant has hooked up the SIWE feature on Shopify wallet connect.

Citcon Partners with Cash App Pay and Afterpay to Enhance E-commerce Payment Solutions

Key Takeaways

Citcon announces a strategic partnership with Cash App Pay and Afterpay.

The collaboration aims to provide e-commerce businesses with a range of payment options.

Merchants can integrate these payment methods with minimal effort and benefit from a centralized dispute center.

Streamlining E-commerce Payments

Citcon, a global leader in digital payments, has entered into a strategic partnership with Cash App Pay and Afterpay, according to a Business Wire release dated September 26, 2023. The alliance aims to equip e-commerce platforms with a comprehensive suite of payment solutions, thereby enhancing the consumer experience.

One-Stop Service for Merchants

The partnership allows merchants to offer customers the option to pay via Cash App Pay or Afterpay’s “Buy Now, Pay Later” plans through Citcon’s Payment Platform. This platform already supports over 150 payment methods. Merchants can access these new payment options with a single onboarding process, settlement, and reconciliation. Citcon’s Centralized Dispute Center will handle all payment disputes, streamlining the management process for merchants.

Easy Integration

Citcon’s robust integration capabilities are designed to cater to businesses of all sizes. Merchants who are already using Citcon’s Universal Payment Interface, WebSDK, or various commerce platform plugins like Magento, Shopify, and SAP Hybris can effortlessly add Cash App Pay and Afterpay to their existing setups.

Targeting Younger Demographics

The integration of Cash App into Citcon’s Payment Gateway offers an opportunity for merchants to attract and retain Millennial and Gen Z consumers. By providing flexible and convenient payment options, merchants can potentially increase sales and build long-term customer loyalty.

Wei Jiang, co-founder and President of Citcon, stated, “This partnership empowers merchants with a powerful payment tool, allowing merchants to reach Cash App’s large consumer base and opening new doors of opportunity for merchants.”

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Mercari Japan Embraces Bitcoin Payments

Mercari, Japan’s leading e-commerce platform, has announced its plan to introduce Bitcoin as a payment option. This move is set to take effect in June 2024, marking a pivotal moment in the integration of digital currencies into mainstream commerce.

Founded in 2013, Mercari has rapidly grown to become a major player in Japan’s e-commerce landscape. With a user base exceeding 22 million per month, the platform’s decision to embrace Bitcoin payments reflects a strategic alignment with the evolving digital economy.

The implementation of Bitcoin transactions on Mercari will be facilitated by Melcoin, a Tokyo-based subsidiary of the company specializing in cryptocurrency services. This approach demonstrates Mercari’s commitment to leveraging its internal resources and expertise in the digital currency domain.

Interestingly, while Mercari will allow transactions in Bitcoin, product pricing on the platform will remain in Japanese yen. This dual-currency approach balances the innovation of cryptocurrency payments with the stability and familiarity of traditional fiat currency, catering to a broad spectrum of consumer preferences.

The move by Mercari is not just a standalone decision but is part of a broader context of Japan’s progressive stance on cryptocurrencies. The country has been at the forefront of crypto regulation, with the Payment Services Act recognizing Bitcoin and other virtual assets as legitimate property since April 2017. This proactive regulatory approach has fostered an environment conducive to the adoption and integration of digital currencies in various sectors.

Japan’s Financial Services Agency (FSA) plays a crucial role in this ecosystem. Regularly reviewing and updating regulations, the FSA strives to balance the promotion of innovation with the need for financial stability. Recent relaxations in the screening process for tokens and further easing of regulations by March 2024 illustrate the country’s commitment to creating a favorable environment for cryptocurrencies.

In conclusion, Mercari’s adoption of Bitcoin payments signifies a significant milestone in the convergence of e-commerce and digital currencies. It reflects a growing trend where major platforms are increasingly recognizing the potential of cryptocurrencies. This move by Mercari, backed by Japan’s supportive regulatory framework, could pave the way for more widespread adoption of digital currencies in e-commerce globally.