The world is changing and it is changing fast. The use and acceptance of cryptocurrencies is picking up steam with growing numbers of countries and businesses being able to accept Bitcoin payments for everyday expenses such as a cup of coffee or a pair of trainers. In order to keep up with this trend, it is paramount that businesses enter into the world of cryptocurrencies. This article will compare the top two payment gateways, according to entrepreneur.com, Hashbon and Coinpayments, evaluating which is the superior network to use. Additionally, we will consider the advantages and disadvantages of using BTC and other cryptos as a tool for running individual businesses.
The Advantages and Disadvantages of Working with Crypto
The need to accept crypto payments is ever growing. In the cryptocurrency space, most payments made world-wide are made in BTC.
Businesses could look to utilise crypto payments by using a crypto gateway that holds a minimum of ten to fifteen crypto currencies and still experience the full advantages of entering the world of crypto due to Bitcoin’s multi-year dominance.
Below are just a few of the various advantages for businesses looking to accept crypto payments as well as a few of the risks/potential disadvantages.
The Advantages of Accepting Crypto Payments
Using cryptocurrencies instead of cash allows for business owners the peace of mind that their money is safe from robbery. Furthermore, the encryption used to send information from ‘A’ to ‘B’ across the blockchain is highly complex and thus difficult to crack. This makes the use of crypto more secure than bank transfer and cash payment.
- Reliability through decentralisation
The blockchain is the most reliable form of technology for recording transactions. When a payment is made it is recorded at a multitude of servers from across the network, these servers are rewarded for tracking records with transaction fees. This means that the information of ‘from where’ and ‘to whom’ the transaction is sent is recorded in a variety of locations across the world. Thus allowing all nodes to verify the truth of each transaction and prevent the issues of hacking or losing payment receipts.
- Inflation resilience
Cryptocurrencies such as Bitcoin are resistant to inflation. This is because in BTCs example, it was created with a set and unchangeable number of coins. There will only ever be 21,000,000 Bitcoins in circulation. Fiat currencies such as the Turkish Lira and the Venezuelan Bolivar have seen high inflation in recent years. In countries with high inflation, BTC is commonly used in order to escape fiat inflation.
The Disadvantages of Accepting Cryptocurrency Payments
- Market volatility
Whilst the volatility of the market can allow for great financial gain it can also cause severe financial loss to both provider and consumer.
- Hackers and scammers
The issue of hackers does not particularly create issues for the cryptocurrencies themselves; the same cannot be said for the exchanges. These platforms are susceptible to cyber-attack which puts users and information at risk.
In addition to this, the finality (the inability to refund or unsend a payment) of each transaction creates an opportunity for scams to take place without consequence.
Various countries including Nepal, Pakistan and North Macedonia have banned any use or activity involving cryptocurrencies. This creates an obvious issue for international sales and payments to and from these countries. (https://www.loc.gov/law/help/cryptocurrency/world-survey.php)
Cryptocurrency Payment Gateways and Payment Aggregators
With these advantages and disadvantages in mind, the issue begins to arise as to how best to transfer fiat (everyday currency such as GBP or USD) to cryptocurrencies such as BTC. This is where networks such as Hashbon and Coinpayments come in. These networks are payment gateways and aggregators meaning they can easily and quickly transfer fiat to crypto and vice versa.
Payment aggregators essentially run behind the scenes, they provide the service of processing transactions made online between the merchant and the consumer.
This is profitable to businesses as it prevents the need to create a merchant account with the bank. This is a lengthy and difficult process which costs time, but by using a payment aggregator most of this process is already completed allowing the business to implement this technology swiftly and easily into their website.
This is where Hashbon shines. With a simple verification process and a user-friendly interface with 5+ languages, the network allows businesses to implement crypto payments into their website with little fuss.
So Which Is Better, Hashbon or Coinpayments?
Hashbon and Coinpayments are ranked first and second in entrepreneur.com’s top ten crypto gateway services.
However, they each have their advantages and disadvantages, which are demonstrated in the table below…
|Transaction commission||0,5 %||0 %|
|Conversion commission||coin TX fee + third party’s conversion fees||1 %|
|Direct bank settlement||No1||To bank account (SEPA), 1%|
|Volatility Risk||High||Zero price volatility2|
This highlights the key differences between Coinpayments and Hashbon, Coinpayments takes a transaction fee of 0.5 % per transaction while Hashbon takes 0%
Notably, the difference in price volatility risk between the two is drastic, with Hashbon having 0 price volatility compared to Coinpayments’ high volatility risk. This is, in part, due to the fact that Hashbon directly transfers crypto to fiat, meaning the transaction speed is swift and the price of the crypto coin used doesn’t differ. Whereas Coinpayments exchange crypto to fiat through a third party; meaning, the transaction takes longer to complete thus the price of the cryptocurrency used can change dramatically.
Furthermore, Hashbon allows the merchant to decide whether the commission fee is passed on to the buyer or the merchant, giving the merchant more control over their finances.
The other key comparison between the two is the fact that Hashbon allows the merchant to receive every single dollar earned from the transaction made with crypto. Whereas, Coinpayments only provide transactions from fiat to crypto for an extra fee.
To conclude, it is in all businesses’ interests, whether small or large, to begin the necessary steps to accepting crypto payments. This has been made easier through the rise of gateway aggregators such as Hashbon which allow businesses to take payments in crypto and transfer it quickly and easily to fiat.
To learn more about Hashbon please visit https://hashbon.com/