Bitcoin is the hot new trend on many news feeds these days. After a stunning rise in its value this year, the cryptocurrency has garnered attention from nearly every sector. New crypto hedge funds are popping up, with powerhouse firms like Andreessen Horowitz, Founders Fund, Sequoia Capital giving backing.
Substantial names in financial advising and research are also backing Bitcoin. Fundstrat founder Tommy Lee recently affirmed his projection of $6,000 for Bitcoin by this year’s end, and other advisers are following suit, moving Bitcoin into the mainstream.
Starting in 2011, the potential for Bitcoin as an investment was clear. Holders were incentivized, as the values increased, to keep their Bitcoin as investments, protecting the asset and watching prices rise and fall.
In recent years though, as values have continued to increase, the call for new ways to actually spend Bitcoin as a regular use like money without the hassle of converting to normal currencies has increased. This desire for greater liquidity has led to a host of new companies, seeking to offer consumers innovative ways to spend their Bitcoin.
Bitcoin Debit Cards for Consumers
The struggle with Bitcoin as a currency is transaction speed. It takes time to process a Bitcoin transaction as it is added to the ledger of the blockchain and waiting to get approved. In fact, processing a transaction can take more than 30 minutes.
The long processing time means that approval for a purchase at a local outlet could take a very long time. You can imagine the line in the grocery store if every customer had to wait for their transaction to get confirmed on the blockchain, no one would ever shop again using bitcoin.
However, companies are finding ways to get transactions processed quickly by using a traditional credit card method called an authorization hold. This method allows the card to hold a certain amount of funds, depending on the purchase, and therefore allowing the transaction to complete.
CryptoPay, for example, has created a way for consumers to use their Bitcoin debit cards at any point of sale where VISA is accepted, and receive the same transaction speeds as traditional credit and debit cards. (They’re also offering other options for consumers in their upcoming ICO.)
As mainstream awareness and acceptance of Bitcoin increases, merchants are making it easier to use Bitcoin directly, as well. These days, anything from a bottle of wine to your college tuition can be paid for using the cryptocurrency.
Online retailers like Overstock, Newegg and Expedia are also getting into the act, accepting the Bitcoin directly for payment, without the need for a debit card at all. Consumers can simply choose ‘Pay with Bitcoin’ on these sites, and provide wallet addresses for withdraw purposes.
Even now, Bitcoin can be used directly from your wallet to buy Amazon gift cards or content, which can also be given as gifts. Imagine buying your next Father’s Day gift card or gadget with Bitcoin!
Payment Gateways for Merchants
As acceptance has grown for Bitcoin among consumers, merchants are quickly trying to find ways to accept the cryptocurrency as a payment. Rather than having to force consumers away from Bitcoin, new payment gateway systems, like the one CryptoPay offers, allow merchants to become digitally comprehensive in what currencies they accept.
It may well be that within a few years, Bitcoin will be the payment currency of choice in many major cities, with consumers picking their favorite coffee shops, restaurants and grocery stores based on Bitcoin acceptance. Public awareness will make it more and more lucrative to accept Bitcoin for purchases.
Bitcoin for Utilities, Electronics and More?
In fact, in parts of Asia, Bitcoin is already being accepted as payment for utilities. Consumers are able to pay their gas, water and electric bills digitally and directly using Bitcoin, without having to convert into local currency. In Japan, consumers can buy electronics with Bitcoin at the largest electronics stores in the country. Even in the US, some local shops are starting to pop up where Bitcoin is accepted as valid payment.
Many other companies are also moving into direct crypto payments in the same way as CryptoPay, making usability of Bitcoin, Ethereum and others that much easier. As the liquidity in the crypto sphere grows, consumers will find reasons to take part in crypto transactions, and values for legitimate cryptocurrencies will increase.