It is becoming increasingly important for merchants and platforms to implement cryptocurrency payment gateways. The cryptocurrency market has evolved beyond just being a means of investing. There is rapid growth in its use as a method of payment. As a result, merchants are seeking the best crypto payment gateway solutions that would allow them to accept cryptocurrency payments. PayFacs, meanwhile, looks for platforms that offer crypto merchant services through third parties and white labels.
Crypto payments are advantageous because they do not involve regulated intermediaries like clearing houses or banks. In the cryptocurrency industry, merchants are well aware of this. Getting paid in crypto may enable you to save on transaction fees. It is, however, different from conventional currency operations to be able to accept and pay cryptocurrency.
For this reason, if you want your business to accept cryptocurrency, you will need to plan carefully. Your target currencies should be clearly defined, and you need to determine which crypto payment platforms support them.
The reasons for this are as follows.
Feature highlights of crypto payment solutions
The following tips are for merchants who accept cryptocurrencies
Numerous blockchains have emerged since the concept of cryptocurrency was first introduced. Ethereum and Bitcoin are two of the most widely known cryptocurrencies. There are many other cryptocurrencies as well, such as BSC, Polygon, Avalanche, Fantom, etc.
Threats
Consequently, as we mentioned, every merchant should identify the cryptocurrencies it intends to support. Cryptocurrencies continue to be considered risky and volatile investments by individuals and organizations. In spite of this, certain currencies (especially stablecoins) tend to be more resistant to sudden price changes. This is due to the fact that the price of a stablecoin is tied to the price of the US dollar. Some examples of stablecoins are USDT, BUSD, and USDC.
Even though stablecoins do have a consistent price, they are not supported by every blockchain. On the Ethereum blockchain, multiple stablecoins can be supported, but Bitcoin can only support transactions in Bitcoin.
Charges for transactions
In the crypto world, gas fees are similar to the fees charged by credit card transactions. Blockchain technology serves as a payment processing system for cryptocurrencies. Several of them (Ethereum, for example) have extremely expensive gas fees, making them ineffective for processing low-value transactions in the crypto market.
Compared to other blockchains, like BSC or Avalanche, gas fees are much lower on these blockchains. Nevertheless, if you work with a blockchain other than Ethereum, you may encounter other problems. We will examine them now.
Would you like to receive payments in crypto? Make sure it’s converted to fiat!
Cryptocurrency acceptance often needs help with problems when it is converted into fiat currency due to the unregulated nature of the industry. Again, if you are considering accepting crypto, you should decide which currencies you will accept and what blockchain is most appropriate in each case.
The two main methods for converting cryptos to fiat are the Central Exchange (CEX) and cryptocurrency cards. With a cryptocurrency card, your cryptocurrency is gradually exchanged for fiat as you make purchases. A special wallet (or account) is required if you operate through CEX. This allows you to withdraw/deposit crypto from/to it.
In a blockchain exchange, you can only deposit and withdraw in a single currency if you “trade” on that blockchain. It is the currency in which transaction fees are charged on the blockchain. In the case of Binance Smart Chain, it is BNB; in the case of Ethereum, it is Ether. And in the case of Avalanche, it is AVAX.
Stablecoins can be withdrawn and deposited through Ethereum networks if you need to do so through an exchange. As a result of the high gas fees, it is only appropriate for transactions with a significant value.
Stablecoins may be more risk-free compared to other currencies, but it is still difficult to deposit and withdraw them. In order for this situation to change, stablecoins need to be able to be used as a payment method without having to be converted into fiat currency.
In summary
Blockchain selection is one of the most important things businesses should consider when choosing a cryptocurrency payment system. The options you have will depend on your business model and the cryptocurrency you want to target.
Are you interested in finding out more? Let us familiarize you with UniPay Gateway by talking to our payment specialists. Software platforms, PayFacs, and other businesses around the globe use it as an omni-channel crypto-friendly payment gateway.