Government lockdowns have ramped up the shift to online shopping. According to ROI Revolution, e-commerce sales are expected to hit a record high of over $843 billion this year in the U.S. alone. Some of the factors pushing e-commerce growth include flexible buying hours, mobile internet penetration, data protection, and the ability to shop at home.
Newly released data from Adobe projects that e-commerce sales will top $1 trillion in 2022. Alongside deploying techniques from a sales training program, integrating cryptocurrencies into your e-commerce business could boost your sales. Leverage crypto, and you slash the transactional cost and provide your customers with more options at the checkout.
Why Is Cryptocurrency Important?
Cryptocurrency, in simple terms, is a digital currency that’s use is not controlled by any central authority, bank, government, or state. There are more than 5,000 different digital currencies being used in sales transactions today. The most popular cryptocurrencies include:
- Binance Coin
- XRP (Ripple)
Crypto is based on blockchain technology and uses complex encryption techniques that regulate their use and generate their release. Through cryptographic proof, transactions are verified and recorded in encrypted databases called blockchains. To prevent fraud, each sale is verified using either proof of work or proof of stake validation techniques.
Cryptocurrency is attracting the attention of many e-commerce retailers. One key reason is that it’s programmed to facilitate automatic conversion into local currency. Some of the major companies accepting crypto payments include PayPal, Tesla, Microsoft, Overstock, and Starbucks.
PayPal is currently allowing its U.S. customers to buy, sell, and hold cryptos in their PayPal accounts. The payments giant is also planning to allow its customers to use cryptocurrencies to pay at 26 million different merchants globally.
Benefits of Using Cryptocurrency in E-commerce
Cryptocurrencies are not only gaining traction as e-commerce payment options but are also making it easier for customers to buy, sell, store, and even negotiate trading assets. Crypto is practically everywhere and continues to gain steam.
By training in how to effectively incorporate cryptocurrency payment options into your e-commerce platform, you can take your business to the next level.
Here are five key benefits of integrating cryptocurrency into e-commerce:
Faster payments: Cryptocurrency gives you instant access to funds. Crypto transactions can help streamline your business cash flow because they’re direct and fast.
More secure: To reduce e-commerce fraud, digital currencies use escrow services. The cryptocurrency escrow account holds the money until both the sender and receiver are satisfied and have fulfilled the escrow agreement. Once crypto sales are complete, they cannot be canceled or reversed.
Greater transparency: Blockchain technology programs guarantee trust and transparency. Through the system of distributed ledgers, each transaction is verified by a user. It then becomes a public record.
Eliminates the middleman: Cryptocurrency removes the need to deal with middlemen in many of its processes and transactions.
Broader market: The convenience of digital currencies appeals to customers across the globe, enabling e-commerce retailers to tap into broader online markets and win more sales.
The potential pitfalls of cryptocurrency
It’s also important to assess the risks, which include:
Currency volatility: Traditional currencies don’t usually have high upswings or downswings of value. However, cryptocurrencies tend to be volatile, which can quickly erode the value of your money during a currency downturn. If the currency falls, you may be unable to restock your merchandise.
Tax issues: The IRS says: “A taxpayer who receives virtual currency as payment for goods or services must, in computing gross income, include the fair market value of the virtual currency, measured in U.S. dollars, as of the date that the virtual currency was received.”
Since the IRS will require you to declare your cryptocurrency earnings plus evaluate them using the value at the date when you received the funds, your recordkeeping and tax calculations can become a little more complicated.
Regulatory challenges: Since cryptocurrencies don’t strictly fall under any territorial regulations, there may be potential issues if you decide to move your business into international markets. For instance some countries, like China, have banned the use of cryptocurrencies.
How Cryptocurrencies Influence E-commerce
Have you been wondering if cryptocurrency payments work for e-commerce? Trainers running crypto learning programs say that both e-commerce and crypto are centered around tech and complement each other well. Cryptocurrency has become part of the e-commerce sales process and is the alternative to cash and credit cards.
An e-commerce platform allows your customers to search for products on the web and purchase them from the comfort of their homes with just a single click. Accepting cryptocurrencies in your online business can give your brand a competitive edge.
The Bottom Line
Digital currencies have the potential to breach the barriers and negotiate entry into the wider e-commerce industry. With cryptocurrency, customers don’t have to use their credit cards, go to a bank, or withdraw money when paying at checkout.
Accepting crypto could serve as a great complement to your e-commerce business as well as give you a new customer base. Train yourself in how to seamlessly integrate crypto payment options onto your platform for the convenience of your customers.
However, remember to take into account the risk factors. Also evaluate how viable using cryptocurrency is based on your product or service and target demographic.