- a comment by Rene Pomassl, CEO at Salamantex
Bitcoin has been around since 2009, and we saw a period of activity and excitement in late 2017 before the market stalled again for a bit – only to be making headlines again in 2021 – so what’s different this time around?
Safe, secure and compliant
The key differences are that the regulatory community is taking note and action, and the infrastructure being built around digital assets is maturing. This galvanizing moment has been driven in part by a combination of high profile stablecoin projects such as Facebook’s Diem and exploration into Central Bank Digital Currencies (CBDCs) by major banks across the globe. Another factor are institutional investments from major players such as Tesla and J.P. Morgan. Along the same lines, Square, a point-of-sale (POS) solution company by Twitter co-founder Jack Dorsey, announced holding 5% of company assets in Bitcoin at the end of 2020. Michael Saylor, CEO of software company Microstrategy, owns more than 105,000 Bitcoin and regards it as a long-term investment.
The long-hyped shift from fiat money to digital money is no longer a matter of ‘if,’ but ‘when’.
Big corporations jumped on the train already, putting pressure on regulators and technology providers to shape the legal framework and infrastructure required by fintechs, corporates and banks to leverage these new types of currencies and assets in a secure and effective manner.”
Increasing trust in digital assets
The past year has seen a significant change in attitudes from corporates, investors and banks. Alternative payment methods are becoming more attractive; cryptocurrencies in the lead.
With the growing trust for cryptocurrencies, they are no longer seen as an investment only but are also gaining traction as a viable payment option. When it comes to payments, adoption has been picking up pace for some time, as a few famous examples illustrate: Microsoft has been accepting Bitcoin for use in its online Xbox Store since 2014. Home Depot’s acceptance means you can essentially build an entire house by purchasing materials using Bitcoin. Starbucks customers can pay for their coffee with Bitcoin. Visa recently announced having processed 1US$ billion in Bitcoin payments since offering its gateway to cryptocurrency exchanges.
There is also a clear demand on the consumer side: A recent Mastercard study found that 40% of millenials would like to pay in cryptocurrency. The number of global crypto users is growing, currently standing at 221 million. Thus, the shift to being able to pay for goods and services with digital assets is a rapidly accelerating natural evolution and it is critical for SMEs to join in.
A world of opportunities for SMEs
Where large corporations go, SME merchants typically follow. Which barriers might merchants face in the transition, and how quickly can crypto payments become a safe and viable reality?
SMEs want and have to future-proof their business to not be left behind. However, they might struggle with the selection of the best solution. With numerous payment software solutions available on the market, it’s a tough choice for merchants starting to familiarize themselves with the options.
For a retailer, the quickly evolving landscape of fintech solutions can be overwhelming. Back to the basics, what does a merchant want and need for the business? – A smooth and fast user experience, backed up by security and easy bookkeeping. When it comes to the final selection, one should look for implemented providers, that offer an attractive network and feature prominent names in their client and partner portfolio.
Why choose difficult if it can be so simple
The first selection criteria to follow is user friendliness, for both the consumer and the business process behind. A crypto payment must be as straightforward as a debit or credit card payment. Thanks to a few years of maturing, software, written for POS terminals and cash registers, exists today to make a crypto payment this simple.
A buyer can pay with a cryptocurrency, in three easy and fast steps:
- The merchant enters the amount in the desired fiat currency (Euro, Dollar or any conventional government-backed currency) and the buyer selects the token wished to be spent instead.
- The payment terminal automatically retrieves and fixes the exchange rate with the respective cryptocurrency and then generates a QR code, which is displayed.
- The customer scans the code with his/her smartphone wallet app and the transaction is confirmed by the terminal with a printed payment receipt.
The experience for both consumer and merchant is straightforward and hassle-free.
So much about the payment experience in store, but how does the software get implemented on site. While any retailer can opt to integrate it at chosen outlets, there is a much easier way.
The cryptocurrency payment option can be integrated with established POS terminal manufacturers, by just adding another payment method to the existing payment processing infrastructure. This means the retailers deal with the payment service providers they already know and minimal to no training is needed for the roll-out.