Business • money
Might Cryptocurrencies Represent the Online Credit Cards of the Future?
- 28003 views Share min read
Have you ever heard of rather strange payment methods such as Bitcoin and Ethereum? Has the term “cryptocurrency” seemed to be cropping up within news articles on a more frequent basis? Are you curious to learn more about how online payment options are continuing to evolve? These are some common and extremely logical questions considering the fact that we are now living within the digital age.
It is now possible to order a product found halfway around the world with the click of a button. Items can be shipped across vast distances within a matter of days or sometimes, even hours. Smartphone applications have taken the notion of online shopping to the next level and beyond thanks to the countless discounts now available.
So, it is clear to see why developing unique and innovative payment options is a high priority for many companies. This is why cryptocurrencies have enjoyed a growing sense of popularity in recent times. However, we need to take a look at how these digital currencies function in order to fully appreciate what the future might have in store.
What is the Basic Principle Behind Cryptocurrencies?
The name “cryptocurrency” itself actually hints at the main purpose of this type of digital transaction. Cryptocurrencies are used as anonymous forms of payment. This is obviously important when we take into account the growing number of data breaches and the understandable concern about personal security while online. Unlike more traditional options such as wire transfers or credit cards, the identity of the individual is never displayed. So, important information will never fall into the wrong hands.
It should now be clear to see why average consumers are beginning to turn towards cryptocurrencies. However, these digital bundles are also very popular with investors for several reasons. Cryptocurrencies are not tied to any type of central bank, so concerns such as sudden interest rake hikes are not present. The value of any cryptocurrency is rather based largely upon the principle of supply and demand. In fact, some currencies such as Bitcoin has experienced truly meteoric levels of growth over the years. Investors may also choose to leverage cryptocurrency holdings against other assets such as standard stocks and shares.
The reason why we mentioned investments in the previous section arises from the fact that investors were some of the first individuals to tout the benefits associated with cryptocurrencies. It therefore did not take long for companies to begin leveraging the very same opportunities. Larger organisations started to incorporate cryptocurrencies into their payment options as early as 2012. Recently, more familiar online entities such as Amazon and eBay have started to experiment with this form of payment. So, it should only be a matter of time before online gaming platforms such as LeoVegas and others begin to look at what these unique payment methods have in store.
This leads directly into the next major question. Why are a growing number of consumers and online firms looking favourably upon cryptocurrencies as a form of payment? The information contained immediately below will prove to be quite useful if you happen to be considering such a shift.
What Benefits do Cryptocurrencies Offer Companies and Individual Customers?
As we highlighted earlier, the anonymous nature of cryptocurrencies is arguably the most attractive feature to the average consumer. The statistics involving online personal data theft have become shocking in terms of how much money is now lost on an annual basis. This is why credit cards, bank transfers and even e-wallets can become compromised on occasion. The algorithms associated with cryptocurrencies are nearly impossible to break, so they are a great alternative.
Some individuals might instead choose to hold on to a cryptocurrency as an alternative form of investment. Let us quickly examine Bitcoin values to cement this point. When Bitcoin was first introduced in 2009, it was valued at $0.0009 dollars. The highest price ever reached by Bitcoin was in 2017 when a single unit was worth an astounding $20,089 dollars. Unfortunately, no one was able to take advantage of this profit; many did not believe that cryptocurrencies had any future when they were first introduced. It is now clear to see why even a small holding could offer up some rather large rewards.
On the other side of the coin, why have cryptocurrencies become popular with online businesses? While the point of anonymity should once again be stressed, there are many other benefits to highlight. For example, a virtual business which offers cryptocurrencies as a form of payment is illustrating to its customers that it is keeping up to date with the latest technological trends. This payment method is also excellent for clients who may be located overseas and are concerned about taxation issues (although this is still a rather grey area). Finally, websites which choose to incorporate cryptocurrencies within their point-of-sale platform are likely to attract a wider range of customers.
The final question involves where cryptocurrencies might be headed in the future. Will they ever replace more traditional payment methods? Could credit cards be equipped with some type of cryptocurrency-like function in the coming years? These are all interesting concepts to consider and yet, predicting the exact outcome is extremely difficult.
It is likely that standard forms of online payments are not going away any time soon. After all, people have become quite accustomed to purchasing items with a credit card or an e-wallet transfer. This does not necessarily signify that cryptocurrencies will remain on the fringes, but rather that they will require a bit more time before the associated advantages are fully realised.
Might it be a good idea for you to take a further look into cryptocurrencies? If so, there is certainly a wealth of information available. There is indeed nothing wrong with adding “another string to the bow” in terms of your payment options. Whether you currently own a small business, online anonymity is important or you are looking for an investment opportunity, cryptocurrencies are extremely interesting prospects to keep in mind.