Not long ago, paying with cryptocurrencies was really difficult. You had to find retailers that would accept digital currencies at check out. And that, of course, was no easy task.
Despite being available for over a decade, only now traditional businesses are starting to realize the benefits of adding cryptocurrencies as a payment method. Starbucks, one of the world’s most famous coffee chains, is planning to integrate direct cryptocurrency payments in 2020.
Sure. People paying for their venti, sugar-free, non-fat, double shot, extra hot, Peppermint White Chocolate Mochas with Bitcoin in over 30,000 outlets worldwide is an important step when it comes to mass adoption. But let’s face it: that’s not going to make your life any easier if you’re willing to pay for other things with cryptocurrencies.
Hopefully, companies like Crypterium have developed cryptocurrency cards that allow you to pay with the most popular virtual currencies anywhere. That means that even if the retailer doesn’t accept cryptocurrencies, you can still use them at check out with a payment card.
The question left is: do you really want to pay with cryptocurrencies with your next purchases? Make no mistake: there are some cons of paying with Bitcoin and other currencies.
For example, if you’re paying a t-shirt with Bitcoin today, and tomorrow the price of Bitcoin goes up, you could end up paying more for the same item. However, it is possible to mitigate the opportunity cost by using stablecoins, instead of volatile cryptocurrency assets.
Now let’s explore the reasons why you should pay with cryptocurrency in the future.
Reasons To Pay With Cryptocurrency
1. Low fees
Banks, alongside with other financial institutions, give incentives to people for keeping their hard-earned cash in their vaults. The banks are clever. They try luring people and making them believe that keeping money with them is simply the best option for taking care of their money.
Challenger banks, like N26 or Revolut, are working hard to make banking friendly and convenient for regular people. Yet, they still come with a price tag attached. Banks charge you fees of all sorts – ATM fees, merchant fees, debit and credit card fees, inactivity fees, maintenance fees, foreign transaction fees, and the list goes on and on.
At the end of the year, you realize that you have lost plenty of money due to a large number of micro fees charged by institutions that promised to look after your money.
The banking system has faced no real competition up until cryptocurrencies came onto the picture. With digital currencies, transactions aren’t processed by middlemen, reducing the fees significantly. Blockchain fees only reflect the energy spent to record a certain transaction, and that tends to be a minimal cost compared to regular banking fees.
2. Enhanced data protection
Banks, credit institutions, and service providers have control of personal information belonging to their clients. This data includes your name, age, net worth, assets, account balances, credit score, home address, employers, and more. If any of these data points were to fall in the wrong hands, the consequences could be terrible for your bank account.
Cryptocurrency payments offer an alternative that includes limited data from users. Paying with digital cash allows you to stay away from identity theft. While a third-party gateway may require your name, your remaining information is kept private. The Crypterium Card was developed with a banking partner that guarantees maximum privacy of your data.
3. Borderless nature
Globalization has given us options. If you think local retailers are offering overpriced items, you can find alternatives in another country. But dealing with cross-border payments could result in additional fees and even delays.
Sending fiat money from one country to another is an expensive, time consuming, and slow process that leaves the recipients with less money in their pockets. The money goes through a series of exchanges before it reaches its final destination.
Using cryptocurrencies, on the contrary, is flawless. Funds move from A to B without interruptions, in seconds and for ridiculously low fees. Moreover, solutions like Crypterium allow users to simply input the recipient’s phone number to send cryptocurrency.
4. E-commerce friendly
The number of cryptocurrency users is on the rise despite the bearish market trend. That said, it is vital for business owners to allow customers pay the way they want. Retailers could also benefit from accepting digital currencies. Crypto online payment gateway BitPay is already processing $1 billion in crypto transactions per year.
Credit and debit card payments processors cost them money, while cryptocurrencies are usually credited instantly to their accounts and without any fees attached. Shopify and Etsy merchants have recently integrated cryptocurrencies to their checkouts.
5. Easy-to-use and secure
With the arrival of NFC technology, the number of people actually swiping their cards has decreased considerably. Nowadays, all you have to do is pull out your smartphone and boom! — the payment is done.
While this sounds really convenient, it also exposes you to some additional risks. Those with NFC readers could easily gain access to your card data, potentially accessing your funds.
Cryptocurrencies offer an equally convenient way to pay digitally using your phone, but extra security measures that prevent hackers accessing what’s yours. You could either transfer cryptocurrency directly to a business from your wallet, or top up a prepaid crypto card with the specific amount needed for the purchase.
6. Growing adoption
There are over 42 million cryptocurrency wallets out there. And that number isn’t going down anytime soon. What began as a basement experiment a decade ago has turned into a multi billion market and an alternative to the traditional financial system.
Cryptocurrencies are now entering in a mass adoption face, with big corporations such as Facebook and Telegram developing their own currencies. At the same time, central banks are already experimenting with CBDC, and China is expected to launch the digital yuan before the end of 2019. Countries struggling to manage their economies, like Zimbabwe and Venezuela, are also turning to cryptocurrencies to fight inflation.
7. Full control over funds
Legacy payment systems are glued together by third parties. It’s your money, your account, but the bank still exercises a lot of control over it. Your account can be frozen or closed if the bank thinks it’s necessary.
With cryptocurrencies, you own the wallet and act as your own bank. You control it and the money (digital assets) stored in it. If you’re using a wallet service like Crypterium, not only you’re in control, but your funds are fully insured.
8. Tax implications
Governments around the world are still trying to figure out how to regulate or tax cryptocurrencies. Currently, a number of states will tax you when you convert your cryptocurrency to fiat currency. In that line, paying in cryptocurrencies allows you to reduce tax pressure.