What are the Advantages and Disadvantages of Cryptocurrency Payments?

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The crypto market has entered a whole new era in the 2020s. Bitcoin has broken records in terms of value, and there seem to be much more investors willing to try out crypto trading. Not only that, but there are also plenty of businesses that have embraced crypto as a valid form of payment. Online markets and land-based shops now embrace cryptocurrency. 

Businesses that Accept Crypto

The most prominent example of a whole business sector having embraced crypto is the iGaming sector. Online casinos are all the rage nowadays, and it seems that more people than ever choose to gamble online, rather than in brick-and-mortar establishments. One of the reasons may be that iGaming has largely accepted crypto, and thus drawn a whole new audience. 

Crypto gambling is so popular online, that there are even websites exclusively dedicated to it. Gambling and cryptocurrency enthusiasts can find some of the best Bitcoin casinos, and place wagers on their favorite games, including blackjack, roulette, craps, and of course, slots. And if online gambling is not your thing, then be sure that there are yet more businesses that accept crypto-based payments.

Starbucks, for example, is one of the largest coffee chains in the world. While they don’t directly accept Bitcoin, their application can be linked to a digital wallet, which their customers can then use to make a direct exchange between Bitcoin and FIAT money, and pay for their drink. On the other hand, Whole Foods, Microsoft, and Tesla have just fully embraced cryptocurrency, and now allow customers to purchase their goods and services by using Bitcoin, Ethereum, or Tether. 

With the crypto market growing in popularity, many are wondering if paying with crypto has certain advantages? Well, that is what we’d like to find out as well. Join us as we explore the advantages and disadvantages of crypto-based payments.

Crypto is Quick and Simple

The primary advantage of cryptocurrency is that it is quick and simple. Most of us are familiar with the meme that men never leave their home without a wallet, phone, or key. However, if they were to rely on crypto payments, a wallet would be completely unnecessary, which means there is just one less thing to worry about when leaving your home.

Payments with Bitcoin can be done easily and simply by any electronic device. As long as you have a device that can connect to the internet, you are able to make crypto-based deposits. And since there is not a smartphone on Earth that doesn’t connect to the world wide web, you are pretty much always capable of reaching for your funds and making a deposit. 

Crypto is Still New

Unfortunately, it is not all rosy. Crypto is still relatively new to the mainstream. We did list off a bunch of businesses that have found ways to monetize Bitcoin. But, they are a minority. If you enter any random store in your local area, the chances are that they don’t accept cryptocurrency. More than likely, the owners don’t even know what cryptocurrency is.

Recently, the crypto market has seen a lot of positive press. For example, recently Bitcoin surpassed silver in market capitalization, and became the 8th largest asset in the world. If we keep seeing news like these, we may one day see a world where crypto has become the de facto currency. However, it has not happened yet. 

Crypto is Proof of Stake

Debit and credit cards are certainly safe. However, it is always possible for a savvy cybercriminal to hack someone’s personal information and drain their account. Even something simpler, like a mugger could hit you where it really hurts, if they somehow get a hold of your PIN code. While it is possible to lose your crypto assets, it is much more difficult for them to be stolen. This is because crypto operates on a proof-of-stake system.

All crypto transactions are record on a publically available blockchain. Blockchains are the technology that enables cryptocurrency’s existence. Not only that, but to many, they are the future of the internet. They make it possible for all transactions to be traced, so as to ensure that nobody is using Bitcoins that do not belong to them. 

Crypto is Volatile

A lot of people misunderstand what is meant when somebody says that crypto is volatile. Of course, any asset, no matter how stable, can drop significantly in value, given unforeseen circumstances. The problem with crypto is that its value fluctuates drastically, almost daily, and there is no way to predict said fluctuation. That is why many people criticize it for being volatile. 

The volatility is also a double-edged sword. Let’s imagine a hypothetical scenario; what if you were to purchase a $5 snack using cryptocurrency. You give the equivalent of $5 to the clerk, and then you get home, happy to have your snack. The next day, you find that the crypto’s value has doubled. What that means is that, in essence, you’ve spent $10 on a $5 snack. 

In our hypothetical scenario, you’ve basically lost $5. To most that isn’t much. But imagine if you are paying with crypto for a full-course meal, a new phone, or even a car. You would be losing a ton of money if that asset rises drastically the next day. Certainly, a lot of people would be very upset in that situation. 

Crypto is Decentralized 

Finally, we get to the biggest reason that people are excited about Bitcoin payments; the decentralization. What that means is that crypto is not governed by any central authority, like banks, for example. Decentralization leads to much greater freedom, reduced censorship, and most importantly, the Peer-to-Peer system that crypto enthusiasts are so happy about.

As you can probably guess, the Peer-to-Peer system refers to the fact that crypto transactions don’t have to be processed by any external authority. That means there aren’t any transaction fees when paying online. It also means that nobody is taxing your purchases. Most importantly, it means that these purchases are incredibly difficult, if not impossible to trace. 

Via: 2Usethebitcoin.com

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