Casey D. Cain works as a project manager and logistics specialist for an international investment firm. In the following article, Casey Cain discusses how in recent years, cryptocurrency has emerged as a popular alternative to traditional forms of payment in the world of eCommerce making it an attractive option for consumers and businesses alike. Additionally, Mr. Cain provides insights into what eCommerce entrepreneurs need to know before deciding if it’s right for business.
Recent years have seen many eCommerce businesses accept cryptocurrencies as the technology gains increasing traction. With some saying crypto has the power to change the entire financial system, it’s likely the world will see even more online retailers accept the currency in the future.
Naturally, Casey Cain says that permitting these transactions doesn’t just bring positives. While the good appears to outweigh the bad, business owners should be aware of the potential risks when deciding whether to allow cryptocurrency payments in their online stores.
Benefits of Cryptocurrency in eCommerce
From anonymity to cost reductions to market appeal, eCommerce businesses stand to gain a lot upon accepting these increasingly popular forms of payment.
Reaching Broader Markets
Retailers wanting to tap into a whole new market will see waves of tech-savvy, forward-thinking consumers by allowing crypto transactions. A community of such individuals has already formed, spanning the globe and granting a huge pool of profit-raising customers to eCommerce owners ready to receive it.
Reducing Transaction Fees
Casey Cain reports that payment apps and credit card companies are notorious for charging transaction fees ranging anywhere from 3% to 5% per payment.
Historically, eCommerce entrepreneurs would factor these fees into their product prices. However, they can lower their prices and still make the same profit margins with cryptocurrency, the much-needed change of pace.
Generally speaking, cryptocurrency transactions carry zero fees. And even those that do will never charge above 1%. So, eCommerce owners snag their desired profit margins while customers benefit from lower prices — a win-win for all involved.
Preventing Fraud and Chargebacks
The blockchain technology behind crypto was expertly crafted to avoid fraudulent activity by ensuring only authorized personnel can view and use the data contained within it.
Moreover, Casey D. Cain says that the instantaneous nature of the transactions means they can’t be forged, refunded, or rescinded. Thus, accepting such payments means eCommerce owners are less likely to experience fraudulent chargebacks or returns.
Bolstering Security
Crypto transactions cannot be reversed without both parties consenting to the action — at the very least, it’s incredibly difficult to do so.
Casey D. Cain also reports that this offers both customers and retailers more security in fraud cases. Since crypto payments eradicate the third-party (i.e., a bank or building society), there’s next to no chance funds withdraw from accounts without the owner’s explicit permission.
Anonymizing Payments
Cryptocurrency transactions let people purchase items anonymously through their encrypted wallet addresses. Just like high-street store staff don’t know their customers’ names, it lets shoppers buy items without revealing their personal information unnecessarily.
Risks of Cryptocurrency in eCommerce
Despite the clear advantages of cryptocurrency in eCommerce, Casey D. Cain says that it brings three potential risks for entrepreneurs to consider.
Volatility
As many investors will understand, cryptocurrency is volatile. Experts attribute this characteristic to one fact — it isn’t bolstered by an official currency like the dollar. So, prices can skyrocket and plummet within days, scaring off a portion of the economically conscious.
Sustainability Problems
Climate change and the environment as a whole are hot topics in this day and age, and crypto poses a great risk to this globally recognized issue. Cryptocurrency mining consumes considerable amounts of energy to obtain coins.
Casey D. Cain explains that as energy and carbon taxes become more prominent, this financial niche will undoubtedly see a swathe of related regulations in the not-so-distant future. Although, many industry participants are toiling to create carbon-neutral mining facilities.
Minimal Buyer Protection
Traditional payment methods come with built-in customer protections. Cryptocurrencies, however, do not. During fraud cases, consumers are generally out of luck since anonymity is a major part of the decentralized system.
Leveraging the Power of Cryptocurrency in eCommerce for Sailing Ahead of the Competition
Provided eCommerce business owners and consumers are aware of the potential risks involved with utilizing cryptocurrency transactions, they’re a great way to gain a competitive advantage in the online environment. After all, many consider crypto and blockchain technology to be the future of finance.
Casey D. Cain says that with crypto comes lower prices, quicker deliveries, added convenience, and unparalleled privacy for customers by reducing unnecessary costs and third-party involvement. Not to mention the power this technology has to open entirely new markets that would otherwise be inaccessible.
Staying ahead of the eCommerce curve means engaging with new related technology, and crypto is a surefire way for online retailers to do exactly that.
