Shh! What’s that sound? Could it be the chink of yet another bitcoin payment ricocheting across the web? It’s not the only one, not by a long shot. And there are other virtual currencies on the rise too. So is it time to get involved yet?
What are they worth?
According to a recent article in the online Asian Review, there are an estimated 700 virtual currencies in existence – ten times as many as two years ago – with a combined value of 500 billion yen (£2.68bn). The sheer amount of crypto cash involved shows that it’s not going away any time soon.
Today, 1 bitcoin is worth £211, way down from its £753 high in November 2013, but considerably up on its £117 low in January 2015, which followed the collapse of the Mt Gox bitcoin exchange in Tokyo last year.
How popular are virtual currencies now?
But while bitcoin may be recovering, the path to general acceptance is far from smooth. Questions about the reliability of virtual currencies have raised concerns in government. Japan’s Financial Services Agency is considering regulation requiring them to be licensed or registered at exchanges. Several banks worldwide have also withdrawn services to avoid the perceived risk of money laundering or terrorist financing.
But despite the hiccups, people continue to exchange cash for cryptocurrencies. Some buy for speculation, hoping that it has the potential to accrue considerably more value, more quickly than any standard currency. Others find benefit in avoiding the charges and delays levied by banks or credit card companies. Still others, such as migrant workers, find it a convenient way to send money home, especially if their country of origin has a poor financial infrastructure.
How do businesses take virtual payments?
So as a business, is it easy to accept virtual payments? Pretty much. If you’re selling online, you can use a bitcoin merchant service, which in its simplest form can be integrated into your ecommerce platform via a plugin. Many of these will automatically exchange bitcoins for standard currency. Or you could choose to hold on to them, in the hope that their value increases.
You can even accept them in bricks and mortar shops using a hardware terminal, an app or even sent to simple wallet addresses through QR codes which can be read by a mobile phone.
Should you jump in?
The landscape is changing fast for virtual currencies, but as we’ve seen, peaks can be followed by troughs and it’s still not clear exactly how things will pan out. It seems pretty certain that they’re coming though, probably sooner than most people think. It may be a little too soon to embrace them just yet, but smart businesses should at least be looking at the possibilities.