Cryptocurrency, a decentralized digital currency is a buzzword that is gaining acceptance and popularity at various levels. Rising inflation and other economic issues have led to a societal paradigm shift and new corporations are too adapting to this shift of crypto to protect their future bottom lines.
Many retailers like Starbucks and more are also offering crypto payments because of the reduced transaction fees, and better security. Retailers are also focusing on understanding the crypto industry and its benefits in the coming future for their businesses.
According to Nick Agar, Founder of AXIA, “More retailers will be offering the option of cryptocurrency to their customers in the coming year due to better payment security, lower transaction fees, and faster transactions. Retailers can research independently or with the help of a consultant to learn more about the benefits of accepting crypto for their business and customer base.”
Opportunity for Growth
There is an enormous increase seen in the adoption of cryptocurrency in 2021, and accepting crypto payments by a few retailers can be a strong differentiator in this world of competition. It is gaining consumer familiarity as well as retailers’ acceptance. To stay up with the time, retailers from different sectors are benefitting themselves by being early adopters like Microsoft, The Home Depot, Starbucks, Whole Foods, KFC Canada, and more.
Post-pandemic customers are acting quite accepting of new changes and acceptance of cryptocurrency is just a small step to the future of the loyalty and reward industry. By incorporating cryptocurrency, the trajectory of the industry will change by providing numerous benefits like new payment options, use of the same currency for international travel, security by an authentic digital signature, and real-time payment at the cross border.
Cryptocurrency provides an opportunity for virtual partnerships with retailers by removing currency barriers and uplifting the value of member data. Looking at customers’ willingness to adopt new technologies, retailers may track the success and get a real hold on crypto success.
Steven Gordon, Professor, Operation and Information Management shared various reasons why retailers would like to consider crypto payments, “It provides the ability to accept sales internationally without paying foreign exchange fees; it eliminates fraudulent chargebacks, which are common with credit card payments; it reduces transaction fees. Accepting crypto as payment might also satisfy some customers' preferences, allow retailers to appear ‘modern’ and provide experience with the means of payment before it becomes required for competitive reasons.”
Government and Cryptocurrency
This digital currency is in debate since 2013, and the year 2021 generated a firestorm of thought. As per industry estimates, “India has 15 million to 20 million cryptocurrency investors, with total crypto assets valued at roughly Rs 400 billion ($5.37 billion).”
It is expected that the formal tax system may protect the digital currency and hints a positive sentiment toward its acceptance in the future.
As per the survey conducted by Deloitte, “More than 82 percent of Indians intend to invest in cryptocurrencies if the government clarifies regulations on cryptocurrency and 55.2 percent of the 1,800 respondents said they have invested in cryptocurrency.”
Introducing a central bank digital currency may lead to efficient currency management. “Crypto exchanges are also hoping that the new tax regime would signal the government’s support of digital currencies and reassure corporations that they may participate in the market.”
Understanding Crypto Currency
It is important to find and understand the types of goods and services consumers buy through cryptocurrency and the problems they face.
The research conducted by CryptoRefills Lab shared, “The three countries with the highest crypto-consumer presence are the U.S. (7.6 percent), Nigeria (6.6 percent), and India (6.2 percent), these countries, therefore, host one-fifth of the users.”
The use of cryptocurrency varies from age to qualification to occupation to gender and consumer prefer to buy digital goods and services in comparison to physical goods and services. Previous studies show the global diffusion of cryptocurrency use in the retail market as well as difficulties like high fees for transaction validation and limited stores accepting crypto payments.
Cryptocurrency can be an integral part of the modern economy and finance, by providing easy and scalable solutions for both businesses and consumers.
Why Retailers Should Understand Cryptocurrency
In this evolving world, retailers are forced to adapt and keep track of the laws of cryptocurrency, sales tax, and digital goods.
Leon Buck, VP, Banking and Finacial Services, NRF mentioned, “It’s up to each retailer and what they think and believe. We believe in retail choice and whatever best fits the consumers’ needs.”
The rise of cryptocurrency and its adoption is coming in retail and retailers need to find out the best way of accepting crypto payments; a wallet, volatile crypto, or third party processor, along with which crypto to accept out of the thousands of available cryptocurrencies.