(Newswire.net — September 25, 2020) — Bitcoin and other cryptocurrencies are legal in many countries. Though it has not completely replaced the traditional ways of making transactions, it will be the most preferred way to send and receive payments. Many businesses have already allowed their customers to use cryptocurrencies for making payments. If you are looking for a crypto payment processor to start using cryptocurrencies, you need to know how it works. In this article, we will also compare crypto payment processors with fiat payment processors
Crypto Payment Processing
Bitcoin or any other cryptocurrency payment service allows a business to sell its goods and services and receive payments in cryptocurrencies. This is very similar to traditional payment processing. However, there are some differences as well.
Whether you are using traditional way or cryptocurrency payment processing, in both cases, there is a procedure that authenticates and processes transactions taking place. In the traditional fiat payment processing, details of the payment are securely recorded and transmitted. It involves the authentication of credentials. In the end, the transfer of money takes place. A cryptocurrency payment processor works the same way. It is an intermediary between the receiver and the buyer. It processes cryptocurrency payments and records the transactions on the blockchain. Blockchain is a complex technology. However, you don’t have to worry about what’s going on in the background. You can simply do your business and accept cryptocurrency payments online.
How Does it Work
To start accepting payments in Bitcoin or any other cryptocurrency on your website, you need to sign up as a cryptocurrency payment provider. Now you can get cryptocurrency payments from your customers across the world.
The customer who wants to pay in cryptocurrencies has to pay the applicable exchange rate when the transaction takes place. This cryptocurrency is then converted into the currency of your choice. This reduces volatility risk. You get money added to your bank account. The cryptocurrency payment service securely sends necessary details to the blockchain network. The transaction is finally authenticated here.
Cryptocurrency Payment Services Advantages
Fiat payment processors are more expensive than cryptocurrency payment processors. It is because of the lower transaction costs. Fiat processing services charge from 2% to 3% of the transaction. On the other hand, a cryptocurrency payment processor charges from 1% to 0.5%.
You can seamlessly transfer any amount to cryptocurrency to anywhere across the globe. All you need is a smartphone or computer and the account of the receiver. You can make payments in your preferred cryptocurrencies such as Bitcoin, Ethereum or Ripple. Cryptocurrency payment processing is more transparent than fiat payment processing. It provides you with a safer and reliable way to send or receive payments.
Fiat vs Crypto Payment Processor
The acceptance of cryptocurrencies is increasing day by day all across the world. More people are using cryptocurrencies to make payments. Blockchain and cryptocurrency together have created a parallel economy that has no borders. There is no central authority controlling this economy. This is the reason why it is replacing traditional payment service providers and methods. In fact there are now decentralized exchanges like keykey.fi to make things even more decentralized.
Less than a decade ago, people used to make transactions in fiat currencies. However, more and more websites are now accepting cryptocurrencies as more people know the benefits of using cryptocurrencies. This also has an effect on fiat payment services providers. In the present scenario and in the near future, businesses still need fiat payment processors. However, cryptocurrencies will dominate. Even fiat payment service providers understand the trend of cryptocurrencies. They are also considering accepting this trend.
Using blockchain technology and cryptocurrencies, you can ensure secure and fast transactions at low cost. This is the right time for you to switch to cryptocurrencies.