It’s difficult to ignore the popularity of cryptocurrencies like Bitcoin in the last few years. The growth of these currencies is leading to more and more online retailers accepting them as a form of payment alongside traditional options like PayPal and Stripe.
Giving your customers more options to pay can only help to increase your sales, and can often be a clever form of marketing to gain exposure to a new audience.
What is a cryptocurrency?
To start with, it might help to explain just what a cryptocurrency is. Keeping things simple, it’s a digital currency that isn’t controlled by any bank or government, but instead uses complex encryption techniques that allow it to be exchanged amongst its users for goods and services.
Most cryptocurrencies use a form of technology known as a blockchain to store information about every transaction that occurs. Groups of transactions are added to this shared database one by one, creating a chain of blocks that can be seen by everyone.
Once a transaction is stored on the blockchain, it can’t be deleted or changed.
How can I accept Bitcoin and other cryptocurrencies on my website?
Bitcoin is by far the most popular currency out there with just over 45% of the entire crypto market share, but there are many other coins such as Ethereum, Cardano, Ripple, Dogecoin and Litecoin.
In fact, at the time of writing this article there are over 12,000 different crypto currencies in existence according to popular coin tracking website CoinMarketCap.
With this in mind, it makes sense to give your users the ability to pay with various different cryptos, depending on their preference. The best way to do this is to use a payment processor that gives users the option of doing just that.
Your price is displayed in pounds or dollars initially, this gets converted into the equivalent crypto value and the user then makes the payment. Once received and verified, the transaction is marked as complete, and the payment gateway now securely holds your funds.
Depending on your choice of payment gateway, they will allow you to withdraw the funds in crypto or have them converted to regular (or fiat) money that you can withdraw to your bank.
Popular CMS systems (content management systems)
We’ve compiled a list of the most popular crypto gateways for each of three popular content management systems – WooCommerce, Shopify and Magento.
Most of the gateways above provide a plugin or add-on that you can use to help integrate payments easily. To start with we recommend BitPay or NOWPayments as they seem to be the easiest ones to integrate.
Click on the links above to read more about each payment gateway and find out what you need to do to integrate it with your site.
What are the benefits of accepting cryptocurrencies on my website?
Lower fees: If you opt for one of the third-party payment gateways above there will still be a middle-man involved in the transaction, however fees are typically much cheaper than traditional payment systems. For transactions that take place directly between the buyer and seller, fees can be zero, however you will have to manage your own wallet to facilitate this. Lower transaction costs can ultimately make your business more profitable.
Exposure to a new audience: Accepting Bitcoin and other currencies can help to widen your customer reach. By adding crypto payments as an option on your checkout, you can appeal to tech-savvy users that may actively look for online stores that support crypto. You can often use this fact as part of your marketing, advertising on forums such as Reddit or as part of any press releases you may put out. Cryptocurrencies also don’t have any country-based boundaries, so it makes international transactions much cheaper and faster.
Increased security: Once a transaction has been completed, a permanent record of it is stored on the blockchain. This can offer retailers increased fraud protection, and the fact that transactions are irreversible means there are no chargeback costs.
Quick transactions: Cryptocurrencies, unlike regular debit or credit card transactions, are processed immediately, giving you much quicker access to funds. This can help to improve your business’s cash flow and give you more control over your funds.
Are there any disadvantages of accepting cryptocurrencies?
Environmental concerns: With any new technology comes potential problems and pitfalls, and throughout 2021 the negative environmental aspects of crypto currencies were brought to the forefront. Due to the encryption methods that blockchain technologies rely on to provide security, large amounts of computing power must be used in what is called “mining”. It was claimed that the power required to keep the Bitcoin network running consumes as much energy as 159 of the world’s nations.
Price fluctuations: Currencies such as Bitcoin and Ethereum can be highly volatile in price, with movements of up to 50% not uncommon. In this case, you wouldn’t choose to have a price displayed in crypto for your products or services, instead you would show a regular price in pounds or dollars, which at the point of checkout would be converted into the amount of crypto required. Once the transaction is complete, it’s your choice whether to convert the crypto into standard fiat money or keep it as crypto currency.
Trust issues: Cryptocurrencies are increasing in use year on year, and their blockchain technology is starting to be utilized in many different ways. However it’s still an industry in its infancy and there have been a number of high-profile hacks which have occurred. With any new technology comes a degree of uncertainty, so any security and trust issues should ease over time.
Too many currencies to choose from: How do you decide which currencies to accept? Most of the gateways listed above allow your customers to use any number of coins, most certainly Bitcoin. So if you’re looking to allow your customers to buy with the most popular crypto coins out there, this won’t be a problem.
What are the best individual cryptocurrencies to accept?
We’ve compiled a list of the most popular as well as the fastest cryptocurrencies below.
The most popular crypto currencies
Bitcoin is the original cryptographic currency, created back in 2008 by an unknown person known as Satoshi Nakamoto. In 2011 a single Bitcoin was valued at just $1, whereas in October 2021 its value has increased astronomically to around $55,000.
New Bitcoins are generated by mining using CPU & GPUs, and a huge industry has grown around this due to the large financial rewards. Modern investors refer to Bitcoin as a store of value in comparison to gold.
Ethereum is the second largest currency behind Bitcoin, with its popularity growing all the time. The currency aspect of the network is called Ether (ETH), but most people still refer to it as Ethereum.
The coin was created in 2013 by Vitalik Buterin, and the main difference from Bitcoin is that the platform allows anyone to run decentralized applications, NFTs and indeed create other tokens all on top of the Ethereum blockchain. These factors make Ethereum a hugely important asset.
Litecoin is an early spin-off (or fork) of Bitcoin, that includes quicker block generation times (2.5 minutes), a higher amount of initial coins and a different encryption algorithm. Many people have deemed Litecoin to be “the silver to Bitcoin’s gold”, and it was one of the first “altcoins” created.
As of October 2021, Cardano is the 5th highest valued coin by market cap. It’s the largest cryptocurrency to use a “proof-of-stake” blockchain – seen as a more greener alternative to traditional “proof-of-work” coins like Bitcoin.
It’s creator, Charles Hoskinson was originally a co-founder of Ethereum, and as such, Cardano also includes the same ability to run applications and smart contracts on its own platform.
A “fun and friendly internet currency”, Dogecoin started life originally as a joke, capitalising on the popular internet “doge” meme along with use of the comic sans font. An altcoin with a huge following, it’s value has soared in 2021 largely due to Elon Musk’s active promotion on Twitter. It was also one of the first coins to be used for tipping, due to its initial low value.
Tether is a relatively new type of crypto currency known as a “stablecoin”. This is because it was designed to always be worth 1 US dollar, meaning it’s value won’t fluctuate up or down like other coins. This makes it suitable as a trading coin for investors who want to avoid price volatility – and as a result the total trading volume of Tether is more than Bitcoin.
The fastest cryptocurrencies
On average, the Bitcoin network can handle between 3 to 4 transactions per second, and the amount of time it takes for a single transaction to be verified (or confirmed) is about 10 minutes.
Below we show a short list of coins that offer improved speeds in both regards.
Hedera Hashgraph (HBAR)
HBAR is the native cryptocurrency of a new type of blockchain called a hashgraph. Invented in the mid-2010s, hashgraph has been described by some as the natural successor to blockchain technology, and one that improves on speed, fairness, cost and security.
- HBAR transactions per second: 10,000
- HBAR confirmation time: 3 to 5 seconds
Nano differs from traditional crypto currencies in that it is based on a type of technology called “directed acyclic graph”, or DAG for short. It was launched in 2015 by Colin LeMahieu, and offers two main advantages over other coins – the first that it is completely feeless, and the second in that it has extremely fast confirmation times, commonly processing transactions in under a second.
- NANO transactions per second: 1,000
- NANO confirmation time: Less than a second
Ripple was launched in 2012 with the aim of providing a more efficient and safer solution for banks and other financial institutions to transfer funds, instead of using traditional systems like SWIFT. Though XRP and Ripple are commonly associated together, they are in fact two distinct assets – with Ripple being a fintech company whilst XRP is the actual crypto currency.
- XRP transactions per second: 1,500
- XRP confirmation time: 3 to 5 seconds
A relatively new coin, launching in 2020, Solana experienced tremendous growth during 2021. It’s a coin that can process a large amount of crypto transactions per second using an innovation called “proof-of-history”, as well as having the ability to run decentralised applications similar to Ethereum.
- SOL transactions per second: 29,000
- SOL confirmation time: 2.5 seconds
Stellar was created in 2014 by Jed McCaleb, a former co-founder of Ripple. The open-source protocol doesn’t require any mining to take place in order to secure the network, meaning that relatively low-powered computers can be used (as nodes) to process transactions.
- XLM transactions per second: 1,000
- XLM confirmation time: 4 to 5 seconds
What large ecommerce stores currently accept Bitcoin or other cryptocurrencies?
Many large online retailers are starting to accept cryptocurrency payments. A short list includes the following – mainly US based – names, but we’ve also added a few UK ones too.
- Air Baltic
- Gift Off
- Raw Living
- Whole Foods
- Home Depot
- Phillipp Plein (fashion company)
Aren’t PayPal going to accept crypto?
In late 2020, PayPal announced that people would be able to buy and sell Bitcoin and other virtual currencies using their PayPal accounts.
In the UK, users can only buy, hold and sell crypto, but in the US people can choose to use their crypto to make purchases with also, in what PayPal have branded “Checkout with Crypto”.
Adoption like this is only going to be positive for the cryptocurrency world, as it makes it easier for less tech-savvy people to find out more about how it works. Currently PayPal supports Bitcoin, Ethereum, Litecoin and Bitcoin Cash.
Is it only a matter of time before most online stores have a “Crypto Checkout” feature as standard? It certainly seems so.
Customers are used to a typical ecommerce experience offering multiple checkout options, so to be presented with another option isn’t going to negatively affect your conversion rate. It’s common for popular ecommerce stores to have a standard debit/credit card option, PayPal, a credit facility such as Klarna and often more.
For those of you considering adding crypto payments to your site, we think there’s never been a better time. If you need help with accepting crypto on your website, please feel free to get in touch with us.
We’re a digital agency that accepts crypto payments for our services as well as advising our clients on the best way of integrating them on their websites. Read more about our crypto website development services here.
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