Back in May, the World Cup was being touted as a huge opportunity for bitcoin to function as a payment option, and by extension, see a modest boost in its price.
According to speculators, the strict economic sanctions on Russia could limit the functionality of foreign debit and credit cards, leading consumers to alternative payment methods such as bitcoin.
In yet another ambitious price prediction that failed to materialize, however, bitcoin lingered around YTD lows with no particularly noticeable spike in volume.
The biggest problem, as John Iadeluca of CCN.com noted, was that there just weren’t a lot of retailers that accepted it. And it’s not just Russia experiencing a drought in crypto-payment options.
Many bitcoin users across the globe may have noticed a steady decline in retailers accepting bitcoin as a payment option. From Steam to Expedia, a number of previously pro-bitcoin corporations have left the space, citing volatility, fees or even safety of their funds.
It’s clear that bitcoin’s crash weighed on the psyche of previously-keen businesses, as well.
While several retail giants that got into the space early are still going strong, such as Overstock or Newegg, for small businesses, volatility could cripple profits in the short-term.
Though there are numerous benefits, such as lower fees, less responsibility in storing customer data and, of course, being at the forefront of the new payment revolution, there are risks. Besides volatility, business owners must be aware of the ins-and-outs of the technology in order to protect their funds.
So what’s a small business to do?
There are several options for businesses looking to accept bitcoin as a payment option, ranging from a personal wallet to business-ready packages which can include automated email confirmations, recurring payments and personalized invoices.
While a personal wallet may be the easiest way to process a small amount of transactions, businesses that rely on a personal wallet must manually check each transaction, which may become difficult or impossible to manage over time.
This is where payment gateways come into play. Businesses are able to integrate these services with their own point-of-sale (POS) system with relative ease. This allows companies to transfer funds into fiat or hold cryptocurrencies as they see fit. Some even allow users to process debit and credit card transactions, as well.
For customers, however, these payment processors have become a point of controversy.
Take the industry-leaders, BitPay and Coinbase, for instance. Both platforms have received scathing reviews from customers looking to make payments with bitcoin due to security concerns, wallet incompatibilities, and more.
But it’s not all about businesses….
There’s another problem stalling widespread adoption - some people simply don’t want to spend their holdings.
With the dramatic fluctuations in crypto prices, a lot of individuals entered the space looking for an investment. Whether they take the long-term approach, or a day-trader approach, rarely is this user-base willing to part with their valued assets for a cup of coffee or a quick meal.
Here, the idea of bitcoin as a payment option becomes more complicated.
While coffee may not be a high priority for some, many of the space’s wealthier holders are often easily convinced to tap into their wallet for high-priced assets that are likely to increase in value, such as art or real-estate.
Another issue users face is wildly unpredictable fees.
Though off-chain solutions such as the lightning network are quickly gaining momentum, they’re still in their infancy and are not yet ready for widespread adoption.
Bitcoin’s future as a payment option
Despite the exit of some retail giants, bitcoin still has a bright future as a disrupting force in payment tech and systems.
It’s easy for shock-columnists and perma-bears to write bitcoin off as dead, but that approach is short-sighted, especially with the speed at which the tech is progressing. New developments such as crypto-debit cards, sidechains and next-gen payment processing applications will breathe fresh life into the space.
With these new additions, bitcoin becomes a more realistic option for payments, and in turn, greater adoption will reduce volatility. Even businesses that bailed on the space before might be more temped to jump back in.
Picture from Wikimedia Commons.
Never miss a thing and suscribe to our newsletter.
Texan living in Mexico, new tech enthusiast, decentralization fan, cryptocurrency enthusiast, geopolitical junkie, digi-explorer, and music lover. I believe that we are on the cusp of a new frontier in how we will view the government, money and energy. Let’s be a part of it, together.