Satoshi Nakamoto, the creator of Bitcoin (BTC), originally envisioned cryptocurrency as a form of payment between two people. This is a key reason why blockchain, the underlying technology of the crypto ecosystem, found its best use cases within the payments sector.
Blockchain-based payment solutions, widely known as crypto payments, allow for a truly global financial network. Cryptocurrencies are detached from geographical restrictions, allowing for seamless transactions between different regions across the globe. The robust technology and potentially minimal fees introduced with cryptocurrency make this type of payment an ideal fit for transaction-heavy digital sectors such as online shopping or e-commerce.
While blockchain-based payments provide significant benefits for the e-commerce industry, online merchants have been taking a wait-and-see approach when it comes to accepting crypto. The main concerns circle around the sophisticated nature of these digital assets as well as the risks associated with embracing a new form of money. Integrating crypto payments has also been a confusing topic for the e-commerce industry because it typically requires a high level of technological expertise.
However, the looming global recession forecasted by both finance experts and government officials forces each industry to be more aggressive in finding new revenue streams to stay afloat in 2023.
Economic turmoil begs for new perspectives
Despite the meteoric rise of e-commerce platforms like Shopify, which enjoyed more than $3.2 billion in total revenues in 2021, the economic uncertainty of 2023 urges e-commerce merchants to find new ways to entice customers. Market researcher Statista expects an annual decline in e-commerce revenue in its latest Digital Market Outlook report, with industry experts comparing current figures with pre-COVID-19 numbers. The global recession anticipated for 2023 presents the perfect opportunity for e-commerce merchants to try and adopt new strategies to lure in new waves of customers.
A 2022 report estimates that more than 10% of global internet users aged between 16 and 64 — a demographic that perfectly fits the target audience of the e-commerce industry — own some form of cryptocurrency. Another report counts more than 320 million crypto users worldwide, positioning crypto users as an attractive audience for any industry that wants to see organic growth.
Low-hanging fruit for e-commerce
As crypto users are actively looking for new ways to utilize their digital assets in their everyday lives, enabling crypto payments for this ready-to-shop audience seems like picking low-hanging fruit. After all, crypto payments provide much faster settlements as well as lower costs per transaction, framing a superior alternative to traditional payment methods — both technically and financially.
Thanks to the borderless nature of crypto and its underlying technology, seamless cross-border payments have become a viable option for online shopping platforms. With over 2 billion people lacking access to the banking system, crypto payments provide a vital point of entry into e-commerce for people across several markets.
Yet, despite the benefits of accepting crypto payments, the technical aspect is still a deterrent factor for online merchants. With many different cryptocurrencies, blockchain infrastructures, and a wide variety of crypto wallets on the table, integrating crypto payments into an online shop for the first time poses a technical barrier for many shop owners.
As technology develops and crypto adoption grows at a steady pace, however, adding crypto payments to online stores will go from multi-layered, try-and-fail integrations to simple plugins specifically developed for e-commerce platforms.
One such solution is developed by crypto payment processor 8Pay for the major e-commerce platform Shopify. Easily configurable from Shopify’s plugin dashboard, 8Pay’s permissionless design is powered by smart contracts, providing a new range of functionality for crypto assets. As a result, users can enjoy single, fixed recurring, variable recurring, and on-demand payments at the click of a button, tracking balances, and managing payments via the 8Pay web or mobile applications.
Completing payments via 8Pay is similar to traditional portals like PayPal, though run over a decentralized network. When a user clicks on an embedded button, visits a short URL, or scans a QR code, they are redirected to an 8Pay checkout, connect their MetaMask wallet, review the operation and sign the transaction. Everything else is handled automatically.
Untapped potential for online merchants
Integrating crypto payments into online shopping does not only generate new revenue streams for e-commerce merchants, it also creates a new way for crypto holders to spend their assets for their everyday needs. As with all other methods of using cryptocurrencies in more traditional aspects of life, establishing a presence in e-commerce also helps with wider crypto adoption.
Accompanied by user-friendly integration solutions, crypto payments would help the e-commerce industry to tackle the uncertainty of the upcoming global recession with a brand-new target audience, a secure infrastructure and lower transaction costs.
As crypto payments become more accessible with new tools and solutions for both merchants and crypto holders, the e-commerce industry is likely to find an untapped market in the crypto ecosystem.
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