Is Cryptocurrency the Future of eCommerce?
There are few people who haven’t heard of Bitcoin, even if they don’t understand the technology and have never invested in any kind of cryptocurrency. Part of the reason for this is because cryptocurrency is not a tangible, fiat currency that can be held or even seen. It only exists in cyberspace over a network of computers. The average consumer most likely has difficulty wrapping their head about a currency no one can see or touch. With that said, the concept is gaining momentum by the day and already some of the largest online retailers already accept Bitcoin. But is it the future of eCommerce? Let’s look at that for just a moment.
The Trust Factor
If you stop to look back at the advent of eCommerce, you will remember just how many people were afraid of making any kind of financial transaction online. They didn’t trust that their personal financial information wouldn’t be intercepted by a hacker to be used for nefarious purposes. It took several years before the average consumer was comfortable doing business online and there are still a great number of consumers still lacking trust in the system.
Once cryptocurrencies are better understood, this should eliminate the last vestiges of distrust still out there. Not only are cryptocurrencies a series of files spread out over a global network, but each file is also highly encrypted. Unless you have access to every bit of data, there is no currency. Also, crypto is not regulated by nations, central banks or banks of any kind. It is simply monitored at various nodes throughout the network and as such, is much easier to keep secure from interception. This provides the highest levels of trust available.
There are very few merchants who accept Bitcoin as a payment method but there are ways to use your crypto as payment almost anywhere. Stores like the national chain Whole Foods began accepting Bitcoin as a payment method in-store and online as well, several years ago. That is just one example of a retailer that takes direct Bitcoin payment.
However, it is suggested that you use a cryptocurrency converter like those found on the okx.com website. While cryptocurrency has the same value no matter what national denomination you are trying to match it against, you do need to know that you are not paying $1k for a gallon of milk!
This is how you can use your cryptocurrency even on eCommerce sites that don’t directly accept Bitcoin payments. The concept of how it works is really quite simple. Hot wallets are like a digital storage file in which your cryptocurrency balances are kept. You can then use the data in the hot wallet to buy products and services online.
Maybe a better way to understand this is like having gift certificates that you can use for online transactions. If you don’t use all the money on that gift certificate, a balance is carried forward for the next time you want to use it. While not exactly the same, it is close enough in concept to give you a basic understanding of how hot wallets work.
A Look at Market Indicators
Only time will tell if cryptocurrency is the future of eCommerce, but all indicators are certainly pointing in that direction. There has been a major explosion in cryptocurrency since its humble beginning back in 2009 with the launch of Bitcoin. Today there are more than 9,000 different cryptos so that should tell you something! With growth this fast and a growing global interest in crypto currency, you can only assume that if not ‘the’ future of eCommerce, it will certainly play some sort of role going forward.