Over the years, Cryptocurrency has become a major method of trade and investment with the proliferation of blockchain. Along with trade and investment, the latest emerging trend has been using crypto for purchases.
Crypto has undergone many improvements since its development and now has vast transaction processing abilities. Many businesses now accept crypto as a method of payment both online and in-person.
Payment via crypto is preferred for online shopping over in-person since the process is much more convenient and faster. Shopping using crypto has many advantages as the process involves no depositing or withdrawal of funds.
Despite there being enormous expectations for cryptocurrency to replace or become an alternative to current centralized payment methods, there is still a lot of skepticism when it comes to crypto as a means of payment. If you’re familiar with crypto in long-term investments and wish to branch out to using crypto for shopping, here are some things you should know.
How to Shop Using Crypto
Using crypto for online and offline shopping is similar to how one would complete conventional transactions. If the service or goods provider accepts crypto as a payment method, then during checkout you select the option that specifies pay with crypto.
You will then have to enter your crypto wallet or virtual wallet information. Sometimes you might have to transfer payments directly to the retailer’s wallet addresses. You will complete the process by entering the amount to be paid. And that’s it; you’ve successfully shopped using cryptocurrency!
Retailers and ECommerce Platforms That Accept Crypto
Since using crypto for shopping is a system that’s still in its early stages, there aren’t many online retailers that accept crypto and in-person retailers who do so are few and far between.
A major reason for both retailers and buyers not using crypto is the long transaction period. We’ll get to that in a bit. However, these numbers are steadily rising and there are a few prominent retailers in different sectors that are opening up their doors to crypto-based transactions.
Many shopping platforms are now trying to incorporate crypto-based payments. Information found at shopping io, a platform that enables shopping from multiple e-commerce stores, provides a comprehensive guide on how to shop retail using crypto. There are also platforms and search engines that list and help you find businesses that accept cryptocurrencies such as Spend a bit and Coin map. Here’s a list of some leading retailers that have delved into the crypto world:
- Online shops: Microsoft, Shopify, Home Depot, Overstock, Tesla, etc.
- Service providers: Express VPN, Bloomberg, AT&T, Twitch, WordPress, etc.
- Restaurants: Whole Foods, Burger King, Starbucks, Subway, etc.
Another simple way to use crypto for buying products from global companies and local businesses is by using gift cards loaded with crypto. Many online providers sell crypto gift cards that are compatible with cryptocurrency.
Transaction Periods Can Vary With Traffic
A lot of buyers and sellers avoid using crypto for purchases because of their slow transactions. But the system is contradictory, for transaction periods only increase when transaction traffic is high. Let us break that down a bit. Crypto transactions are verified by a blockchain process which is impacted by several factors.
The crypto network can only process a few transactions per second. As more and more people start to use crypto for transactions, the network gets overloaded. With a crowded system, transactions get queued and subsequently transaction fees rise. On a normal basis, however, transaction fees for crypto-based purchases are lower compared to those for conventional online transactions.
Developers are in the process of finding solutions for network congestion issues. The latest technology in the crypto shopping scene is Lightning Network. This separate channel used for Bitcoin-based trades overcomes congestion to process transactions quicker. After each transaction, the network updates the specific crypto’s blockchain status.
Users must keep the Lightning channel open until the transaction is complete. Since this is a recent technology, it’s always being updated to enhance performance. As transactions are relatively slower in person, it is easier to shop online using crypto, where you wouldn’t have to wait in line until the payment is complete.
Thoroughly Review Refund Policies
Shopping online and in-person is always subject to the possibility of returning products. Whether it be damaged goods, low-quality services, or simply a matter of not liking the product, a refund is mostly ensured. What matters is how the refund is done; via cash, credits, or digital money.
If the refund happens through digital money such as cryptocurrency, then you will have to keep in mind changing exchange rates. Since cryptocurrency values keep fluctuating, the rate of exchange could vary from the time of the transaction to the time of refund.
You should make sure sellers are ready to provide refunds at the appropriate rate to ensure no loss on your side. Payments made via a processor have sophisticated return procedures. So, it is always a good idea to look into refund policies beforehand.
Transparency of Transactions
Transactions done with crypto are relatively safer and not as easily susceptible to fraud. This is because crypto transactions do not involve middle-man entities such as banks. So, it is safe to say that the likelihood of someone stealing your crypto is low.
With both the crypto market as well as its presence in e-commerce growth, it is no surprise that people are dipping their toes into the world of crypto-based transactions. If you are well informed about the do’s and don’ts when it comes to shopping with crypto, you are all set to splurge on whatever you desire using crypto.