Before we delve deep into discussing the topic, firstly, you must know about cryptocurrency. It is a form of digital payment used for the online purchase of goods and services. The digital currency has become the latest topic for becoming a mode of payment in eCommerce. Many big companies around the world have started to accept cryptocurrency for payment while other merchants and vendors are still in the dilemma about using it or not. With thorough research and study, it is recommendable to avoid it for eCommerce.
There are several reasons that state why you should avoid cryptocurrencies for eCommerce. Here are 5 reasons why you should avoid it:
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Volatile Currency:
National currencies may fluctuate a bit during the time of inflation but remain more or less stable for a few years, depending upon the growth of the country’s GDP. In contrast, cryptocurrencies are highly volatile in the market. Their value was equivalent to $5000 in 2020 which fluctuated to around $55,000 to date. This is 10 times more than the previous year.
The cryptocurrency industry has come up with a solution for the issue of its volatility. It introduced stable coins in the market whose value is attached to stable assets such as gold. Due to the reduced chances of earning potentials, crypto speculators are neglecting the adoption of such stable coins. Thus, it has not widespread outreach in e-commerce yet. This fluctuation provokes a great risk of loss for small and average dealers in the eCommerce market.
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Negligible Customer Protection:
It can be challenging for eCommerce vendors to apply for chargebacks as they can be expensive and time taking. Payment through cryptocurrency offers no such protection for chargebacks or fraudulent credit payments. An online consumer has no right to complain if the vendor does not deliver his service on time. Vendors do not have any litigation to refund any crypto payment to the customers. This lack of consumer protection rights adds a crucial statement to avoid such digital currency in eCommerce.
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Security Threats:
A cryptocurrency is a form of digital payment that can be stolen just like cash or credit cards. If you lose your credit card, then your money or card can be recovered back from the bank after formalities. In contrast, if your cryptocurrency is once stolen from malicious hackers, then it cannot be recovered back. This kind of security threat or risk can be immensely dangerous for an eCommerce buyer or seller. They may lose all of their hard-earned money without any security protection.
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Expensive Mode for Ecommerce:
About 1% of online purchases are made with the acceptance of cryptocurrencies. This kind of digital transaction involves an expensive procedure. Ecommerce merchants who accept cryptocurrency have to maintain and integrate separate payment gateway along with currency conversion charges. Converting cryptocurrency into your national currency is a lengthy and expensive process as they charge a great sum of money for the conversion. This may hamper your revenue earned from the online deal itself.
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Limited Acceptance:
Unlike cash and cards, crypto is still not recognized as a prime gateway for payment. Only a few limited retail e-commerce purchases can be made through cryptocurrency. This mode of payment is difficult for eCommerce vendors to process. It is also better to avoid crypto payment for consumers due to its very limited acceptance in the world.
Ending Note:
Governing bodies around the world are trying to ban, control, and limit the use of cryptocurrencies for the benefit of people. It is better to rely on your usual cash and credit payment methods. Use simple online transaction procedures from your bank servers to avoid any risk or threats.
So if you want to make stress-free online transactions for goods and services, then avoid the use of cryptocurrencies. Make eCommerce a safe place for your online products and services.
