Traditional versus modern, past versus future – that is how the pendulum swings between current online payment methods. On the one hand, centralized, inefficient and costly credit cards that give everyone a run for their money; on the other hand, decentralized, super-efficient and low-cost cryptocurrency payment methods that have a growing list of great advantages for both buyers and merchants. Get ready to swap your credit card for a virtual wallet.
Cryptocurrency was born for online payments
For those of you who don’t know how credit cards worked back in the pre-Internet days or have ever witnessed someone manually signing a credit card transaction receipt, let us clarify the situation for you: credit cards were created back in the 1950s and were clearly designed for offline shopping. Fast forward seven decades, credit cards are still the most used online payment method, but only for lack of a better option because, honestly, its entire support system is heavy, outdated, riddled with problems and fees. That’s where cryptocurrency comes in: it was created for the digital age. It was designed to streamline online payments, making them swift, safe and low-cost.
Cryptocurrency is a perfect alternative
Why are cryptocurrencies a great alternative to credit cards? Well, even in this day and age, the truth is that not everyone has a credit card and with the rise of crypto, they won’t even need one. With various cryto coins on the market, acquiring and using them to pay for online purchases is easier and faster than applying for a credit card, paying the annual fee and having to insert your financial data every single time you buy something online, because when it comes to your money, you just don’t trust the Internet entirely. In addition, you can say good riddance to many other credit card risks: interest charges, foreign transaction fees, late fees, processing fees, frozen accounts and negative credit scores.
Cryptocurrency is faster
When compared to credit card transactions – which can involve 4 or 5 parties – a cryptocurrency transaction only involves two parties: buyer and seller. Cutting out all the financial intermediaries (think issuing and acquiring banks, credit card associations, processors and payment gateways), along with their long lists of rules and compliances, makes this online payment process so much quicker and a whole lot smoother. Buyers have their items delivered faster and merchants receive their payments faster – a win-win situation, which is great for business.
Cryptocurrency is cheaper
Did you know that credit cards rack up fees that can easily span anywhere from 0.5% to 15%, on both the buyers and the sellers’ end? But that’s not all: credit card chargebacks are rising at a rate of 20% per year and, in 2016 alone, resulted in a loss of $6.7 billion, which essentially means that credit card fraud and all types of fraudulent payments are a giant pain-in-the-wallet for all those involved. With all these crazy money-consuming fees and frauds, it’s no wonder merchants drive up their prices… and consequently drive away their customers. What if we told you that one of crypto’s biggest selling points is its extremely low fees or, in some cases, it’s non-existent fees? Money for thought…
Cryptocurrency is safer
Safety is another one of the huge spot-on features of cryptocurrency: when you make an online purchase with crypto, no personal identification is provided because cryptocurrency transactions simply don’t require any personal information. Payments are made via an anonymous alphanumeric address and a private key; and if said payment is being concluded via a mobile device, a QR (quick response) code can also be used. Besides the fact that the anonymous address changes with every new transaction, cryptocurrency transactions are irreversible and cannot be cancelled, which is key to avoiding costly chargebacks.
And because cryptocurrency transactions are processed with electronic wallets (accessed via computer, smartphone or the cloud), the risk of stolen or lost credit cards become one more thing from the past.
Again, all this means you’re saving time, money and headaches all around. Ready to say goodbye credit cards, hello cryptocurrencies?!