What can the prospect of crypto payments mean for e-commerce sector

Insights from CoinGate stated that 2022 witnessed more than 60% crypto-based e-commerce transactions

Reportedly, companies such as WooCommerce, Open Bazaar, and PrestaShop have added crypto-based payment mechanisms
Reportedly, companies such as WooCommerce, Open Bazaar, and PrestaShop have added crypto-based payment mechanisms

With e-commerce considered important for global business landscape, experts seem to explore how cryptos’ integration can ensure its growth. From an organisational purview, cryptos can help support e-commerce-based cross-border payments.

Insights from CoinGate, a crypto payment processor, stated that 2022 witnessed more than 60% crypto-based e-commerce transactions. The platform’s research also showed that CoinGate-oriented merchants secured 927,294 crypto payments with Bitcoin clocking 48% of all transactions, for 2022. “I believe the importance of crypto payments in e-commerce lies in its ability to provide a decentralised payment method. In 2023, crypto-based e-commerce payments can make a difference by offering convenience and flexibility to customers,” Punit Agarwal, founder, KoinX, a cryptocurrency taxation platform, told FE Blockchain.

Prospects around crypto-based e-commerce payments suggest that marketplaces can gain a competitive advantage by reaching out to customers, irrespective of geographical boundaries. According to ShipHero, an e-commerce platform, crypto-based e-commerce stores can tap into a market of tech-savvy clients, limit transaction fees to 1.5%, and decrease frauds through distributed ledger technology (DLT). However, cryptos’ introduction in e-commerce can expose buyers to high price volatility and regulatory concerns. 

“In 2023, potential of cryptocurrency-based e-commerce payments to revolutionise the digital payment industry is high. They can offer a secure and efficient way to buy and sell goods and services globally. The two primary drivers that can boost adoption of crypto-based e-commerce payments in the future are regulations and acceptance,” Edul Patel, co-founder and CEO, Mudrex, a crypto-investing platform, highlighted.

Reportedly, companies such as WooCommerce, Open Bazaar, PrestaShop, among others, have added crypto-based payment mechanisms for customers. For example, Open Bazaar permits business-to-business (B2B) and business-to-consumer (B2C) forms of e-commerce amongst companies and people from a crypto background.

Moreover, future predictions indicate that e-commerce can help drive mainstream cryptocurrencies’ adoption and enhance development of new payment technologies. As stated by Manchester Digital, an independent trade association, number of retailers around crypto payments is seeing an upward trend, due to presence of third-party payment processing systems such as Bitpay and Cryptopay.

“The future of cryptocurrency-based e-commerce payments looks promising, with experts predicting growth in the coming years. However, there are issues that need to be addressed such as cryptocurrency volatility and lack of widespread adoption. It is likely that crypto payments will become an important part of e-commerce transactions,” Sathvik Vishwanath, co-founder and CEO, Unocoin, a cryptocurrency exchange, concluded.

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First published on: 28-02-2023 at 08:00 IST