Predictions say cryptocurrencies will be put to practical use as an alternative to cash by obtaining citizenship in the future. It is one of the fundamentals that will occupy the future of bitcoin circuit system . So this time, we will explain the current state of payment use of virtual currency.
Is cryptocurrency practical?
Cryptocurrency like bitcoin was originally developed as an electronic cash system for payment use. It is designed to directly engage in financial interactions between two parties without the need for a central manager, such as a bank. After the creation of bitcoin, it was in a great speculative environment that it could serve the purpose or not. By the time, we can see the practical usage of this crypto including others in a vast field of economy.
Most of the purpose of purchasing cryptocurrency is to gain profit from trading and gain capital gains from the long-term operation. With Bitcoin Era, you can trade cryptos with a user-friendly interaction. Besides, if you want to use your profits earned from cryptocurrency for shopping, it is common sense to convert it into cash before using it. Otherwise, you have to spend it directly for the merchandise products who accept crypto payments. Many of you may have viewed bitcoin transactions directly between terminals using QR codes. Overseas, the use of bitcoin as a payment use is also widespread.
There is a fee for international transfers made using banks and money transfer providers. There are also inconveniences such as currency exchange fees, feed amount restrictions, and business days. By using cryptocurrency, it is also possible to send money quickly between borders and be free from these problems.
How to use cryptocurrency?
So, what are the practical uses of cryptocurrencies at present? Although the use of tokens as a blockchain is diverse, there are many commercial purposes, so here we will explain how to use cryptocurrency at the end-user level.Currently, there are two ways to use it at the end-user level.
- Payment services such as exchanges
It can be said that the payment service of the exchange is the most popular cryptocurrency payment service.
Service targets include physical stores, e-commerce sites, individuals, etc. Most stores accept bitcoin with other cryptos. As an introduction store, 1% of settlement fees are cheap compared to about 2-5% for credit cards and 2-4% for electronic money.
One needs to copy the merchant’s crypto address and paste it on the payment option in the exchange platform. Then they have to put the amount needs to be sent. After that confirming the payment will execute the transaction and the merchants will receive the crypto in their crypto account.
PayPal, and major payment service companies such as Braintree, stripe, and square facilitates this cryptocurrency payments.
- Cryptocurrency debit card
Debit cards that use bitcoin, ether, etc. as capital is a payment method. It is becoming popular overseas, mainly in the United States of America. Some popular cryptocurrency exchanges such as Bitcoin era, coinbase and Binance also issue debit cards.
Debit cards are associated with cryptocurrency wallets, and the balance on your account can be used as a source of funds in the same way as credit cards. Whether the dealer support the virtual currency or not, the card company either directly or by exchanging virtual currency againts cash, will paid the value to the merchant.
This service is realized in partnership with visa and mastercard, a major credit card company, and can be used at stores with credit card payment terminals and e-commerce sites. There is no need to introduce new terminals on the store side, and if the promotion of use in this field progresses, it seems that cryptocurrency will change to practicality at once.
It is still not well-known in many countries, and some companies issue cryptocurrency-based cards to residents in partnership with overseas banks.
Online payments
For online payment of cryptocurrencies, there are few sites available. However, the number of payment agency services is gradually increasing. Since credit card payment is the norm for sites. It is a field where there is a high possibility that infrastructure will be possible at once if the handling of cryptocurrency by credit card companies advances.
Other cryptocurrencies need to be exchanged for available currencies once but can be exchanged for a small fee. Purchased NFT can be stored in your wallet and sold at any time resale or auction.
In Conclusion
It is likely to depend on the trend of major credit card companies that hold the key to the practical application and promotion of cryptocurrency payments. Visa, the largest credit card payment company, announced in March 2021 that it will start payments using virtual currency. In addition, MasterCard, a competitor of visa, also supports cryptocurrency settlement. If the correspondence between these two companies advances, it is expected that the practical application of cryptocurrency will advance.