If you are interested in using cryptocurrency for online payments, this article will give you some background information on what is possible. The second part of this article will be about how to purchase the coins and which methods are the best methods to use.
Cryptocurrencies are mostly used as an investment or speculative tool, but many people have started using them recently for online payments as well. The rise of crypto in the last few years has been phenomenal and now it is very easy to transfer cryptocurrencies from one user to another without third-parties involvement (no need for bank accounts). This makes this method very attractive for many different types of users. However, there are not many places where you can use them yet outside forex trading platforms, some online gambling sites, and some online shops that accept Bitcoin, Ethereum or other cryptos.
Back in 2017, when the cryptocurrency industry experienced its first boom, the cryptocurrency firms introduced many products and innovation in the same year. However, the 2018 plunge of the entire cryptocurrency industry made things worse for the new projects. In the year 2017, two major projects were launched that were Decentralized Finance and NFT, but both of them did not experience much adoption.
How to use cryptocurrency for online payments
The first thing you need is a eWallet. This can be an online wallet or an offline one (where you store the coins on your computer). If you want to purchase some cryptocurrency and only use it for online payments, than it is probably enough with an online wallet. For example, Coinbase offers customers the possibility to create wallets where they can easily login with their username and password. You can then buy some Bitcoin or Ethereum and store them in that wallet. You will receive a unique address that you will have to give to the person who wants to pay you with cryptocurrencies. They just need to transfer money from their own wallet into yours – very similar process as sending an email.
Another possibility is to get a hardware wallet, where you store the cryptocurrencies offline on a USB drive. This is more secure and will probably be used by more serious people who plan on holding cryptocurrencies for longer periods of time. However, even an online wallet might be enough for some users that only want to buy things online with them or use them as a speculative tool.
After getting some coins into your eWallet it is possible to start buying some goods online from various web shops that accept cryptos as payment methods. However, one important thing you need to keep in mind when using cryptocurrency is the exchange rate. If I pay for something with 1 Bitcoin today, but tomorrow all cryptos have dropped 30% in value against the dollar, I will have lost money. This is common for this kind of investment instruments, but you need to know that there are always some risks involved here.
Some payment platforms allow people to buy cryptocurrencies with real-world currencies like dollars or euros. If you are lucky enough, the owner of the web shop where you want to make a purchase accepts cryptocurrencies as well and then it is very easy to pay with them. However, most merchants only accept top two crypto coins (Bitcoin and Ethereum). For example, Microsoft allows users to use Bitcoin/Ethereum for its products on their website. So they just need an eWallet and an address from Coinbase or another provider they trust and all buyers can use cryptos as their payment method.
There are also some online wallet providers that enable people to create an account with them and then pay for all their items from the same web platform. One good example of this is Bitpay.com, where you can login to your dashboard and use Bitcoins or Bitcoin Cash as a payment method on over 40 different million web shops. It is important to mention here that if you have some Bitcoins/Bitcoin Cash in your eWallet, but no dollars – it might be more expensive to purchase things using cryptos because there is a big spread between buying and selling prices. You have probably experienced that when you buy Ethereums/Bitcoins at different platforms – they ask for a certain price and then sell it back a little cheaper – at a slightly lower price. The same thing happens here and the final purchase price might be higher than expected if there is not enough money in your wallet and you have to buy cryptos first and then spend them on the website of your choice.
Payment Options of eCommerce Platforms
Over the last few years, more and more businesses started accepting cryptocurrencies as payment methods. Some of them introduced their own tokens/coins, others choose to work only with Bitcoins or Ethereum, but all these companies want to be perceived as progressive and offer something new for their customers which is why they enable people to pay with cryptos for goods instantaneously without having to wait too long for a transaction confirmation from blockchain network.
Things are changing though and every day we hear new news about more and more businesses accepting more different types of coins or connecting up to different payment platforms that integrate with crypto wallets more easily.