Should Ecommerce Platforms Accept Bitcoin Payments?
Bitcoin has known popularity and success, but does it have what it takes to transform online retail?
Thanks to the recent controversy over Bitcoin’s origins, this digital currency has been experiencing an unprecedented level of publicity and press coverage. However, Bitcoin still remains on the fringes of public acceptance. You’re unlikely to walk into a shop and see the Unicode symbol Ƀ at a checkout, and no restaurant is going to accept payment from the blockchain. This is an online currency for virtual transactions, which begs the question whether online retailers and ecommerce platforms should be willing to accept it. Here, we consider arguments for and against accepting payment by Bitcoin…
An Argument For YES
Bitcoin was literally made for the internet. With every transaction securely – if anonymously – recorded in an incorruptible and permanent ledger, this electronic currency is the perfect partner to online purchases. There are no clumsy 2FA logins to a brick-and-mortar bank account that was never designed to be used electronically, while theft is effectively rendered impractical by the all-knowing blockchain.
PayPal has become a success because it dovetails smoothly with the ecommerce experience, but its daily use remains clouded by endless spam messages and the unavoidable link with traditional bank accounts. Bitcoin has largely avoided the attentions of scam artists and cyber-criminals, which means it’s a more trustworthy form of payment. Also, it is not an abstract concept unfamiliar to the general public – there are special ATMs everywhere from London to Glasgow where people can change sterling into Bitcoin. Airlines and travel companies increasingly accept it, recognizing the benefits of a single global currency with no exchange rates or credit card fees. Little wonder Bitcoin’s value is stabilizing after years of marked fluctuations.
Many of the arguments leveled against Bitcoin are born of ignorance or a preference for the old-fashioned way, just as the first Barclaycard was decried by traditionalists who continued paying by check. Unlike those infamously bouncy check, however, a Bitcoin payment is guaranteed – and instant. A tipping point will eventually be reached where a critical mass of retailers offer i, or of consumers who demand it, and suddenly it will become as ubiquitous as chip-and-pin machines. With dedicated WordPress plugins and Bitcoin-compatible payment gateways already available, surely your company should be a trailblazer rather than a reluctant late arrival to the party?
An Argument For NO
Bitcoin will never break into the mainstream. From its flawed architecture to an unavoidable association with criminality, there are reasons its exchange rate has fluctuated wildly against traditional currencies like Sterling or the dollar. For these same reasons it will struggle to find acceptance in a cynical world where even legitimate PayPal updates are often dismissed as spam.
Just as today’s youth struggle to imagine Britain’s currency once involved shillings and pence, it’s hard to convince older generations that tomorrow’s currency comprises a unit currently worth around $460, and sub-units worth one hundred millionth of that amount with nothing in between. How many Satoshis would it take to buy a Chromebook? Even worse, what happens when the limited volume of eleven million Bitcoins has all been used up? It would require a complete redevelopment of the currency to put more into circulation, which shows the existing currency wasn’t designed to take account of demand, inflation or anything else.
It’s equally hard to envisage Bitcoin ever disassociating itself from the murky waters of the Deep Web, where’s it’s used to pay for everything from drugs to depraved pornography. The anonymity of the blockchain (which itself requires a huge and ongoing effort from volunteers) has made Bitcoin a haven for people far more malevolent than the fraudsters targeting conventional payment channels. Should companies really be selling goods and services in exchange for an anonymous currency with such dubious associations? It’s certainly hard to see Bitcoin breaking out into the real world, and any currency that only exists online will never have the authority of Sterling, the dollar or even commodities like silver. If a high street store won’t accept Bitcoin, why should an online outlet accept it?