As a result of the significant growth of electronic commerce, a great need was created for a different sort of money, maybe virtual money, that can be utilized as a payment method.
The first cryptocurrency to emerge on the scene was Bitcoin, it gained the trust of users which paved the way and led to its survival, but only to secure a critical presence in the world of online marketing transactions.
Advantages of cryptocurrency
1- Secure payment method
With the rising concerns over credit card fraud, many vendors online are turning away good business opportunities. Such styles of fraud are more common online in global transactions, which made many brands refuse to accept international payments.
With a new digital currency like bitcoin, the transfer cannot be undone once it has been made. This way the risk of fraud is eliminated for merchants which allows them to sell worldwide with total confidence.
2- Direct with no middle men
This new style of payment is based on a very important principle which is the absence of central entity holding or taking control over the merchant store data. This gives vendors total independence in deciding what can be offered and bought. On the other hand, it is barely impossible to stop a malicious store from selling products and services that are considered illegal.
3- A source of innovation
No doubt bitcoin has it its flaws and risks, it has a limit and it can be stolen. However, the only idea of such currency is very inspiring, especially for entrepreneurs. It is seen as an open-source ecosystem for programming, which means the model can be improved upon and modified by anyone for future products, services and utilizations.
4- Programmable money
Cryptocurrencies enable new options that were not possible with the current or let’s say conventional, monetary systems, from automated land title escrow to intelligent machine to machine payment contracts. The possibilities seem limitless with many of the world-changing uses still to be dreamt of. However, it is important to note that this area of development is still in the experimental phase.
5- High accessibility
The world now has 2.2 billion individuals who can access the internet or mobile phones and don’t have access to any of the traditional exchange means. These people are perfect target audience for the Cryptocurrency market. In Kenya, MPESA system (Mobile Phone based money transfer and microfinancing system) has recently announced a bitcoin device giving one in three Kenyans an active bitcoin wallet.
6- Universal-level recognition
Cryptocurrency is not limited by any exchange rates, transaction charges, interest rates, or other charges recognizable in any country; that’s why it can be used at internationally without having any problems. This, in turn, saves a lot of time and money on any business which is spent in transferring money from one country to the other. Cryptocurrency operates at the global level which make transactions very easy.
Given the stated advantages, a number of notable high profile retailers are enabling Bitcoin payment. It is expected to continue growing in the near future. With the rising popularity and interest in this area, online deals will become quicker, easier, more convenient, less expensive, more efficient and more importantly, safer. In short, it’s going to alter the whole banking and the financial system. This doesn’t mean that the world of cryptocurrency is 100% guaranteed, still there are a lot of matters to check and explore. But once it is demystified, it will certainly be the radio and TV-like invention made to leave a lot of change in our style of living.
However, there are some factors inhibiting the currency’s growth and its takeover of online e-commerce transactions, most notably the difficulty in communicating the concept of cryptocurrency payments to end users.
It is also said that Bitcoin’s historical association with criminals and illegal deals and money laundering is more likely to act as a deterrent to large-scale adoption.