For any merchant, accepting credit card payments may be convenient yet costly since you have to incur processing fees charged by card providers. Putting ‘cash-only’ policies may hurt revenues for your business as most customers prefer cashless payments. A better alternative that will help you grow sales and tap into additional revenue streams is integrating cryptocurrency payments. So, how can one get started?
The Case for Accepting Crypto Payments
A cryptocurrency is digital money whose value is backed by cryptography to facilitate secure and anonymous transactions. Cryptos are not issued by central banks, governments or other central institutions. Instead, they are built on blockchain protocols to enable peer-to-peer (P2P) transactions.
The first-ever cryptocurrency, Bitcoin, launched in 2009 and thousands more have been added to the market since then. Blockchain technology is rapidly advancing, and financial institutions continue to add crypto services. This mainstream adoption has seen the crypto market cap grow to over $1 trillion. More people now have access to cryptocurrencies and are using them to settle payments for purchases. Here’s why you should start accepting crypto payments:
- Secure: Payments made in crypto are secured using the underlying cryptography on blockchains. Merchants and customers can rest assured that there will be no network breaches to steal funds from their wallets.
- Anonymous: Users can buy, own, and manage crypto assets without giving up personal information. Also, cryptocurrency payments deploy anonymous accounts and wallets to facilitate transactions. So, you can accept or make payments anonymously.
- Easy Integration: For merchants operating an ecommerce store, adding support for crypto payments is simple. A versatile blockchain API will allow customers to check out using any cryptocurrency by integrating crypto wallets into the Point of Sale (POS) system.
- Mainstream Adoption: A digital currency makes the perfect match for this digital transformation, allowing P2P transfer of value. Cryptocurrencies are expanding fast, attracting more users. Your ecommerce platform loses out on a new revenue stream if it doesn’t support crypto payments.
- Cost-effective: Unlike the hefty charges by payment card providers, cryptocurrencies incur minimal gas fees. This low cost is possible because cryptocurrencies run on decentralized networks. So, there are no intermediaries who would otherwise charge huge fees for facilitating transactions.
- Borderless: You can make crypto payments instantly across international borders. This way, your business readily accesses funds to help grow and expand operations. On the other hand, international bank transfers could take up to 5 business days to settle a transaction.
Crypto Regulatory Framework
Notably, crypto payments are quite new, and many countries have little-to-no regulations for this sector. In an attempt to regulate these activities, some countries have imposed total or partial bans and risk policies, among other advisory terms for citizens.
In most countries like India, Bangladesh, Nigeria, and Nepal, cryptocurrencies are not recognized as legal tender. China has a near-total ban on crypto operations. These regulations vary across different countries. The EU, the United States, and the United Kingdom also have differing regulations, but none exclusively restricts crypto operations. As a result, many companies in these regions accept crypto payments.
The Downside of Accepting Crypto Payments
For customers, some cryptos like Ethereum may charge higher gas fees when the network is congested. To resolve this, ensure your platform accepts multiple cryptocurrencies by deploying a multichain blockchain API that will provide options for customers to pay affordably.
Another downside is that cryptocurrencies are inherently volatile. Huge price fluctuations may cause crypto to lose or gain significant value within short periods. To offset this risk, an ecommerce platform may encourage customers to pay using stablecoins – cryptocurrencies whose values are pegged to fiat currencies like the US Dollar, Euro, or Sterling Pound.
Integrating Crypto Payments
There are three essential items needed when adding crypto payment support to your business. Firstly, you need a flexible crypto wallet that will accept multiple cryptocurrencies, including stablecoins from paying customers. A secure hot wallet is preferable as you can receive and manage your payments easily wherever you are.
Secondly, you need an adaptable blockchain API that will help you accept any (and every) crypto payment directly to your wallet. Connect your wallet’s public address to the API and start receiving payments to your merchant account.
Lastly, put out the word to your customers that the business accepts crypto payments. You can generate a QR code or domain name to simplify the wallet address and ease payments. With a versatile Blockchain API, your clients will be excited to explore the multiple crypto payment options, adding to your revenue earnings.
Must-have Crypto Payment Features
The following features are indispensable when integrating crypto payments:
Security: Although crypto transactions are secured on the blockchain, wallets storing crypto can be hacked if private keys are compromised. You can secure your private keys by deploying a non-custodial wallet. Adopt a secure blockchain API as your payment gateway because stolen cryptos may be hard to retrieve due to transaction anonymity. Generally, you should prioritize the security of your wallet, funds, and payment gateway.
Customer Support: Given that crypto technology is still developing, some transactions may experience long delays. Choose a payment gateway that maintains a customer support team to assist clients who experience inconveniences while making crypto payments. This way, your customers can make payments easily on your ecommerce platform.
How to Add Support for Crypto Payments
Deploying a blockchain API as a payment gateway is a simple and secure way to accept crypto in your business. One such API is Chaingateway.io, which has an API through which you can accept multiple tokens, even stablecoins, as payment. The blockchain API is easy to set up and configure to connect with your ecommerce platform.
The API simplifies your work since its developers are responsible for upgrading its features and fixing and resolving bugs on the system. It is, therefore, a cost-effective way to introduce crypto payments to your customers.
For merchants operating online stores, adding support for multiple payment methods adds to your revenue stream. Specifically, merchants can tap into the growing crypto market to start accepting cryptocurrency and stablecoin payments for their businesses. A simple and secure way to integrate these payments into your business operations is through a versatile blockchain API.