Digital currency as a way to pay in an online shop
Original title: Digital Currency as an Option Payment for the Goods in E-commerce
Imagine you run an online shop and want to start accepting cryptocurrency. What exactly do you do? With my co-authors I looked at the payment options available in Slovakia and abroad, and turned that comparison into a procedure for introducing virtual currency into an online shop.
Why it is worth reading
It turns "should we accept cryptocurrency?" into the concrete decisions a shop operator actually has to make.
What to take away
- Accepting cryptocurrency in a shop does not mean building your own solution. In practice it means choosing a payment intermediary — and that can be compared like any other service.
- That is why we compared the options in pairs and turned the results into a general procedure for introducing them.
- The chapter also compares Bitcoin and Ethereum. From a payments point of view they are not interchangeable.
- We weighed both the merits and the drawbacks. Cryptocurrency as a payment method is neither obvious nor absurd — it is a decision with costs.
A question that sounds simple
“Should we accept cryptocurrency in our shop?” is a question you can answer yes or no to, and both answers will sound reasonable. The trouble is that neither tells anyone what to do on Monday morning.
So my co-authors and I decided to rephrase it: if you genuinely wanted to, what is the procedure?
What we did
First we had to be clear about what we were even discussing — what a cryptocurrency is, how a peer-to-peer network works, and where the line runs between a currency, an asset and payment infrastructure. Without that you cannot talk about payments at all.
We then looked at which electronic payment options are available in the European Union and in Slovakia, and weighed the merits and drawbacks of cryptocurrency as a payment method. The chapter also compares the two most widespread cryptocurrencies, Bitcoin and Ethereum.
Our own research rested on fairly down-to-earth work: we gathered information from providers’ websites and wrote to them by e-mail. We then compared the options in pairs.
What came out of it
The result is not a recommendation to accept or not accept, but a procedure — what to settle first, what to compare, and in what order to decide, if you want to introduce virtual currency as a payment alternative.
The key finding is rather dull, which is exactly why it is useful: a shop does not build its own cryptocurrency solution. It picks an intermediary. And an intermediary can be compared like any other service — on fees, support, integration, and who carries the exchange-rate risk.
Why this belongs here
This chapter is typical of what interests me about the digital economy: a topic that attracts a large debate on principle turns out, on closer inspection, to break down into a series of practical decisions. And those can be compared.
This text is a plain-language summary of an academic chapter and serves educational purposes. It is not investment or business advice.
Bibliographic details
- Authors
- Iveta Kremenova, Juraj Fabuš, Natália Stalmaševová, Dominika Koncova
- Published in
- Smart Cities: Importance of Management and Innovations for Sustainable Development
- Year
- 2024
- Pages
- 419-437
- Publisher
- Springer Nature Switzerland
- DOI
- 10.1007/978-3-031-56533-5_28
- Keywords
- Bitcoin, e-commerce, Ethereum, Cryptocurrency, Litecoin, Moner, payment gateway, payment options, payment processor, virtual currency
Show abstract
Official abstract in its original wording.
The aim of this chapter is to present a general procedure for establishing virtual currency payment options in e-commerce. The authors of the chapter delve into the realms of e-commerce and virtual currencies, examining payment alternatives in Slovakia and abroad. Emphasis is placed on elucidating the relationship between virtual currency and e-commerce, encompassing a comprehensive characterization of cryptocurrency. The incorporation of cryptography into the discourse is pivotal. A thorough explication of the peer-to-peer network concept is imperative since cryptocurrencies operate on this principle. The analysis extends to e-payment options within the European Union and Slovakia, evaluating both the merits and drawbacks of implementing cryptocurrency as a payment method. Furthermore, the chapter addresses the overarching pros and cons associated with such e-payment systems. A comparative analysis between the widely used cryptocurrencies Ethereum and Bitcoin is also included. The research component of the chapter scrutinizes the feasibility of integrating cryptocurrency payments into e-commerce platforms. Utilizing information gathered from various websites and email inquiries, the authors compiled a general procedure for introducing virtual currency as a payment alternative in e-commerce. The selection process involved pairwise comparisons of third-party payment options. The resultant findings facilitated the creation of a comprehensive proposal outlining the establishment of virtual currency as a viable payment option.
Cite
Kremenova, I., Fabuš, J., Stalmaševová, N., & Koncova, D. (2024). Digital Currency as an Option Payment for the Goods in E-commerce. In Smart Cities: Importance of Management and Innovations for Sustainable Development (pp. 419-437). Springer Nature Switzerland. https://doi.org/10.1007/978-3-031-56533-5_28