Why offering bitcoins could be right for your shop
Chris Dillon speaks to FastBitcoins founder Danny Brewster to find out how retailers could benefit from the cryptocurrency gold rush
From ATMs to payment equipment, forward-thinking retailers across the UK have embraced bitcoins, the headline-grabbing cryptocurrency, in many forms in recent years. FastBitcoins offers retailers the chance to offer the currency to their shoppers – even if you only have a basic understanding of how it works.
FastBitcoins provides vouchers that retailers can sell, which enables customers to redeem bitcoins. It works like mobile phone top-up vouchers. Customers can spend up to £200, although retailers can set the upper limit and then to redeem, then they log onto our website. The currency only gets converted at the point of redemption so customers can hold on and then convert when it’s right for them.
Retailers earn a 2% commission on every transaction, but the real benefit is the fact that bitcoin brings news shoppers through the door and these tend to be more affluent and therefore spend more.
Rather than taking up floor space with an ATM, offering vouchers is a way of bringing the offer to your store in a small footprint. There’s no cost to retailers either, so minimal risk.
In terms of risk, our merchants also do not hold any bitcoin, meaning that they require zero up front investment and are not exposed to the underlying market fluctuations.
All of the risk is managed by FastBitcoins so the only thing the merchant needs to focus on is selling.
Another benefit is that our terminals uniquely allow merchants to accept bitcoin payments in real time. Unlike typical payment processor networks like Visa, MasterCard, fees for doing digital payments in bitcoin are much cheaper. Merchants can further profit from this or pass savings on to customers in the form of lower prices for good.
We currently work with 25 independent convenience retailers in the UK, but we believe that every single store in the country would see demand if they offered it. Bitcoin investors aren’t just young tech-savvy people in the city, we’re seeing a very diverse customer base emerging, with growth particularly from older consumers and rural communities.
Most recently we launched in Nisa Local in Barry, enabling them to offer a service that no other store in the area has.
Bitcoin is a speculative investment, but it has been the best-performing asset of the past 10 years. It has been successful, I believe, because it has answered a real market need for anonymity and decentralised currencies away from Governments. It’s still a volatile market, I’ve seen the bubble burst at least five times, but it is designed with stability.
For example, although bitcoin has inflation built into it, it gets cut in half every four years. Because of the way that Bitcoins are created – or mined – that will mean that there will only ever be 21 million bitcoins in the market at full capacity. You’d then have to get the vast majority of the market to agree to open up more, which I don’t believe will happen.
This means that, like gold, there is only a finite supply and that’s one of the factors that secures the value.
We are enormously passionate about the market. I love talking about it, so will happily share my thoughts on the market with anyone, but we are not in the business of giving advice on whether someone should invest or not. One problem bitcoins face is when dramatic headlines are reported in the media it can have either an incredible or damaging effect.
It’s important to remember that bitcoin will not make you rich overnight, and we try to avoid that kind of language as much as possible. It’s about long-term, stable investments, not a quick win.
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