The cryptocurrencies bitcoin and others like it may seem to operate in the shadows, but anyone seriously following the payment industry must keep an eye on bitcoin, the way some people now prefer to transfer money.
When bitcoin first came online in January 2009. It isn’t even clear who created this method of payment. The bitcoin currency is the most prominent in a class of cryptocurrencies. It uses encryption algorithms to secure the currency’s transactions. When someone makes a payment with bitcoin coin, it’s impossible to identify a user; only his pseudonym. There is no record of a transaction in a central location. And the payment method has no one in charge of it, not even its creators.
Still, bitcoin has caught on as a digital currency. There are nearly 15 million bitcoin units in circulation today with a total value of between $3 billion and $4 billion. As many as 100,000 merchants of one kind or another accept bitcoin, including PayPal and Microsoft.
Cryptocurrencies as a payment method
There are concerns with this payment method. Most apparent is how its anonymity can lead to use by criminals, including drug traffickers. But traditional financial institutions like JP Morgan Chase and others are considering whether the bitcoin currency could streamline processing and reduce the costs for international transactions.
Additionally, since the bitcoin price fluctuates, it can be unnecessarily volatile for some transactions. A single bitcoin has varied in price from US $0.30 to more than US $1400. In fall 2016, the bitcoin price was around $600 and showed signs of stabilizing.
There are as many as 700 other cryptocurrencies similar to bitcoin that want to get in on the game too. An academic journal Ledger is now available to inform you about the bitcoin currency and related cryptocurrencies.
At United Thinkers, we’re more than just the creators of the UniPay gateway. We’re experts in the payment industry, following its trends and staying ahead of the curve in meeting the needs of our clients. While the UniPay gateway doesn’t support bitcoin or cryptocurrencies yet, we’re here to support your payment processing needs. Can we help you understand today’s payment industry and the challenges of the future?