It is estimated that every month, more than 50,000 new retailers across the globe accept bitcoins as a form of payment for goods bought or services rendered.
In 2018, we are going to witness an increased uptake of bitcoins by both consumers and retailers. The growth of bitcoins has seen investors pump more than $1 billion into improving the blockchain technology that supports transactions using cryptocurrencies.
The upward growth in the value of bitcoins as witnessed in 2017 only gives freelancers, merchants, retailers and buyers plenty of reasons to adopt bitcoin payments. As the adoption bandwagon continues to grow, the following are the top 7 reasons why making payments in bitcoins is growing and gaining popularity.
1. Almost Instant Settlements
The greatest advantage of using bitcoins to make payments is that the process is swift and near- instant. It takes a very short duration to transfer bitcoins from one wallet to another. When making a purchase, you just need to log into your wallet and order the transfer to the merchandiser’s wallet. A normal transaction usually takes about 10 minutes. All cryptocurrency transactions are irreversible, and this makes them more transparent and secure. Once you send your bitcoins to a different person, it just takes three confirmations before the other party receives the bitcoins. This ability to make cash transfers successful in seconds makes bitcoins a better alternative to normal currencies.
2. Anonymity & Privacy
Payments made in bitcoins remain completely anonymous. This is in contrast with normal bank payments where payments can be analyzed and tracked. On the bitcoin blockchain, what is displayed after every transaction is your wallet address. Your wallet address hides all your details as no one can guess the correct owner of a wallet address. The most that can be known are the addresses of the trading parties, but their personal details such as real names, bank accounts or countries of origin cannot be uncovered. This helps people remain anonymous as they are able to make or receive payments without being known.
Cryptocurrency payments are cheaper as compared to payments using normal currencies.
For instance, to broadcast a transaction on the bitcoin network, it will cost you about $0.05. As more people continue to adopt cryptocurrencies, the costs will further go down. Sending money across borders using banks can be costly and slow. You need to visit the bank physically and request for a transfer of funds from your account. The bank will charge heavy commissions, and factoring in costs of currency exchange at the country of reception, the process ends up being very costly.
4. Efficient International Payments
Assume that you are working for an overseas company and they need to pay you. The company will have to incur a lot of costs during the process of transferring funds, and you, the recipient, will bear the burden of the extra costs. The situation gets worse when you have to convert the currency to your home country’s currency. The currency exchanges will charge their commissions, and at the end of the day, you will have lost a substantial amount of money. Freemit, Align Commerce and Abra are startups that intend to make the international transfer of funds using bitcoins cheaper and faster.
5. Quicker Money Access
Following a sale, you can easily access your money through the bitcoin network. For instance, merchants that use BitPay can receive fiat currencies in their bank accounts only a day after receiving bitcoin payments. There are also plans to launch bitcoin debit cards that will be used together with bitcoins. This will give bitcoin users a lot of freedom on how to access and use their finances. With a mobile phone or a computer and internet connection, you are able to make payments from the comfort of your seat. You do not need to visit a bank or an ATM machine to make payments. You can always make payments at any time of the day that you want unlike using banks that are mostly closed at night and over weekends.
6. No Loss of Customer’s Data
Two transacting parties remain anonymous. Two people who do not know each other can receive or send payments to each other using this digital currency. Provided that you know the wallet address of the other party, you can still trade with him without anyone bothering you with their personal details. For instance, paying using credit cards often requires the merchant to collect private customer’s information so as to verify the details on the credit card. This information, if not stored well, can be stolen and used to make unauthorized payments. This makes bitcoin very safe to transact with. There is no way your private keys or wallet address can be hacked in the bitcoin network.
Transacting using the bitcoin network has played a great role in fraud prevention. This is because every transaction is recorded in a publicly verifiable ledger. Once an entry has been registered on the ledger, it cannot be edited. This means that there can never be double payments or reversal of payments.
With normal currencies, a buyer can receive a product from a merchandiser then claim his or her money back. There are thousands of cases of fraud involving stolen or hacked credit cards every year. Since bitcoins are not physical in nature, it is very easy to hack or steal them. When making bulky payments, for instance, you might need to walk around with lots of cash, which can be very inconveniencing. But with digital currencies, you just need to have a computer and internet access.