Stablecoins improve payments for e-commerce and bring new retailers to crypto | Opinion

As an analyst with over 15 years of experience in the financial market and a focus on fintech solutions, I can confidently say that stablecoins are set to revolutionize the e-commerce industry. Having closely observed the evolution of digital assets, it’s clear to me that their potential is limitless.

As an analyst, I’ve noticed that stablecoins are emerging as a vital option for businesses seeking to streamline and elevate their payment systems. In fact, just a few weeks ago, the value of stablecoin transactions in Singapore surpassed $1 billion. This surge in popularity stems from the perception that stablecoins offer a superior alternative to conventional fiat payments and unpredictable cryptocurrencies. Now, these digital assets are not only a common tool for everyday transactions like payments and shopping but also a significant player in the e-commerce sector.

But how exactly will they transform the e-commerce industry? Let’s break it down.

The current state of crypto payments in e-commerce

Worldwide, the usage of digital currencies for transactions is picking up speed. Research indicates that a significant number of consumers, approximately 64%, express enthusiasm about employing cryptocurrencies and stablecoins as methods of payment. This trend is further validated by the $4.2 billion worth of crypto payments facilitated through Visa’s crypto-linked cards in the first quarter of 2023 alone.

Among younger age groups, particularly those between 18 and 35, there’s a significant interest in cryptocurrency usage: Around 40% are considering using it, while approximately 10% aim to use it frequently. Furthermore, about 31% anticipate making regular crypto transactions within the next year. On the commercial front, around 74% of businesses foresee integrating crypto payments into their systems within the following two years.

Countries such as the United States, Canada, Australia, the European Union, Israel, and the Central African Republic are currently taking the lead in the field of cryptocurrency; on the other hand, emerging nations like China and Russia are now delving into unified cryptocurrency regulations via the BRICS alliance.

As a researcher, I’ve noticed significant advancements and encouraging indicators in the field, yet the distribution of adoption remains inconsistent. Nevertheless, it’s evident that the widespread utilization of these technologies is an inevitable reality, primarily due to the presence of stablecoins like Tether (USDT) and USD Coin (USDC). These digital currencies have proven their stability and are poised to play a significant role in our financial future.

Stablecoins: A game-changer for e-commerce payments

Stablecoins can easily become the most convenient payment method. Why? Speaking briefly and clearly about the advantages of stablecoins, I can highlight that they offer:

• faster and more secure payment option;
• simplified and stable entry point into digital payments;
• eliminated conversion and exchange rate fluctuations.

Indeed, that sounds promising! Particularly the final point about cross-border transactions could potentially spur widespread crypto adoption among businesses dealing across various markets. As an investor, it’s exciting to envision how this development could revolutionize our investment landscape.

Consider for a moment if you were an e-commerce business owner. In this digital marketplace, payments are essential. Picture yourself handling numerous orders, and each one is being deposited into your traditional bank account. Now, think about how much simpler and more efficient it would be if those payments went directly into your cryptocurrency wallet instead. Not only does direct transfer mean a seamless transaction, but it also offers increased control over your funds, making the entire process smoother and more manageable.

To be more precise

Because stablecoins are linked to traditional currencies such as the US dollar or Euro, they have less price instability than other digital currencies, making them more dependable, as their name implies. This characteristic is a significant advantage for businesses, enabling them to secure profits without worrying about sudden changes in value due to market fluctuations. Consequently, stablecoins can serve as a reliable payment method for these companies.

Furthermore, with the growth of stablecoins like USDT and USDC, they can now be found not only on prominent blockchains such as Ethereum but also on quicker and more economical platforms such as Polygon, Solana, Avalanche, Optimism, and Algorand.

Every blockchain offers its unique advantages; for instance, Polygon can process transactions in a swift 2.1 seconds per block at an average cost of only $0.015. Meanwhile, Solana boasts incredibly low transaction fees that are approximately 0.000014 SOL or $0.00189, which is nearly 900 times less expensive than Ethereum.

By extending their reach across multiple blockchain platforms, stablecoins are becoming more convenient and applicable to a wider assortment of commercial entities. In the realm of e-commerce, stablecoins significantly reduce complexities related to conventional transactions, like chargebacks, hold-ups, and exorbitant processing costs.

As a crypto investor, I can’t stress enough the game-changing potential of stablecoins when it comes to simplifying cross-border payments – a longstanding headache for e-commerce retailers. Unlike traditional fiat currencies, which are prone to conversion and exchange rate fluctuations, stablecoins offer a smoother approach to international transactions due to their stability. This makes them an invaluable tool for streamlining my global business dealings.

To summarize, stablecoins provide access to an international clientele with minimal complications often associated with conventional payment methods.

The future of stablecoin adoption in e-commerce

The regulatory framework has been and is one of the biggest challenges in crypto adoption. However, as the regulations continue to evolve, more regions are adapting cryptocurrencies to fit their business needs. Stablecoins, in particular, are well-positioned to take a leading role in this transformation. What we are witnessing is the gradual normalization of cryptocurrencies—Singapore, as I mentioned in the beginning, is a great example of it.

In simpler terms, digital assets are now seen not just as rare or experimental, but as essential components for the development of future financial transactions.

In the coming times, it’s likely that new stablecoins will not only be linked to traditional currencies but also other assets. This development could lead to a wider proliferation of stablecoins on various blockchain platforms and increased global adoption by businesses.

Stablecoins are no longer a distant possibility—they are here, and their potential is unlimited. They provide businesses with a solution to many of the challenges faced in e-commerce by offering a stable, secure, and cost-effective alternative to traditional fiat payments and volatile cryptocurrencies. Faster transactions, lower fees, and increased accessibility—all these make stablecoins a no-brainer way to improve payments for not only e-commerce but all businesses and bring new retailers to crypto.

It’s just a question of when stablecoin transactions will become commonplace in online shopping, as the digital era undoubtedly prevails, and stablecoins are paving the path.

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2024-10-13 14:08