One of the main reasons for the creation of cryptocurrencies was their use as anonymous payments. This reason is often lost in the hype raised by the media and the financial sector, which focus on the rise and fall of prices.
Prices are important, but it is much more important to know how to pay with cryptocurrency, as it is gaining more and more popularity.
Cryptocurrency is a complicated thing, but using it to pay for something is relatively simple. Here’s how and where you can pay with cryptocurrency.
KAY TAKE A WAYS
- You can buy cryptocurrency for fiat money on cryptocurrency exchanges.
- You send and receive payments using a cryptocurrency wallet.
- You can use any wallet compatible with your chosen cryptocurrency.
- A growing list of online and retail stores accepts cryptocurrency as payment.
How to Make a Payment with Cryptocurrency?
Once upon a time, sending cryptocurrencies involved diving into the command line on your computer and programming the transaction. Now the complex process of sending and receiving cryptocurrencies has become much easier, it is very similar to using an application to send or receive money to and from your bank account. How to initiate a payment depends on the application you choose, but in general it looks like this?
Acquire a Cryptocurrency
To purchase cryptocurrencies, it is not necessary to have an account in an institution, on an exchange, in a company or other organization. However, this is one of the easiest and safest ways to get hold of cryptocurrency if you are not familiar with creating a wallet, sending or receiving cryptocurrency.
A regulated cryptocurrency exchange will allow you to exchange fiat money for cryptocurrency. It will also provide you with some additional features if you need them, such as storing your private keys or helping with technical issues. Reputable exchanges such as Coinbase, Binance.US, Kraken or Gemini, will help you get started when you create an account and top it up to buy cryptocurrency.
To make a payment using cryptocurrency, you will also need a wallet application. Wallets can be installed on your computer or mobile device and serve as an interface for accessing your cryptocurrency.
Your wallet does not store cryptocurrency; it stores the keys necessary to access it – these are your private keys. Your wallet has a public key that is used in transactions; it acts as an email address that is used to send and receive payments.
There are hundreds of wallets, each of which has its own characteristics. Some of them are compatible with almost all cryptocurrencies, while others can only work with some of them.
Most cryptocurrency exchanges provide their users with a wallet that allows them to transfer funds to other exchange users or make payments using services compatible with the exchange’s services.
Many wallets can use your device’s camera to scan QR codes to create unique addresses for sending and receiving cryptocurrencies. Some of them even have a near-field communication function that allows you to make contactless payments in cryptocurrency.
Sending and Receiving a Payment
You will need to use your wallet to send and receive payments. All wallets are different, so this example uses a Coinbase wallet. In general, to make a payment, you need to:
- Open your wallet’s app
- Click on the Send Payment button or a similar button
- Enter the amount you want to send
- Enter the QR code or the recipient’s wallet address
- Click Send or a similar button
To receive a payment, you would:
- Open your wallet’s app
- Click the Receive Payment button or a similar button
- Click the Share Address button or a similar button
- Accept the payment when it appears in your wallet
Where Can You Pay with Cryptocurrency?
Cryptocurrency is still in its infancy, but the list of places where it can be used to pay for goods and services is constantly growing. Most businesses accepting cryptocurrency as payment do so through cryptocurrency payment gateways – payment service providers, which usually guarantee the conversion of cryptocurrency into fiat during the transaction to prevent price slippage.
Among the well-known companies that accept cryptocurrency directly, allow you to add it to the application for payment or accept it through a service provider, the following can be named:
- AMC Theaters
Some retail businesses and stores are starting to accept cryptocurrency. Those who do this usually use point-of-sale equipment associated with one of the payment service providers. On doors, storefronts or at the checkout, you will often see signs with information about which cryptocurrencies are accepted.
Pros and Cons of Paying with Cryptocurrency
- Fewer Fees
- Pay from Anywhere
- Available to Everyone
- Transaction Fees
- Price Volatility
- Not Regulated
- Not Reversible
- Risk of Loss
- Anonymity/Pseudonymity: Since the cryptocurrency is decentralized and user information is not required, it is anonymous. This allows you to conduct financial affairs without close attention from the authorities or other persons who may get into them for various reasons. However, some argue that the cryptocurrency is an alias, since your wallet address can be used to identify you if you ever allow this information to be available.
- Peer-to-peer: The cryptocurrency is designed for peer-to-peer communication, which reduces the need for third parties to participate. You can send money to anyone or receive it from anyone without involving other services.
- Fewer Fees: Many financial services charge a commission from you or from the company where you make a purchase for permission to use your money to make or receive payments. The peer-to-peer nature of cryptocurrency allows you to charge less fees; you can view this as a lower cost for all parties involved in the transaction.
- Pay from Anywhere: Cryptocurrency allows you to make or receive payments anywhere where there is an internet connection.
- Accessibility to Everyone: Many people have no quick access or no access at all to financial services such as banks and loans. However, most have Internet access via mobile devices. This allows everyone to make and receive payments, make and receive loans or access financial services wherever they are.
- Transaction Fees: Although there are fewer fees charged for cryptocurrency transactions, you will have to pay a commission for a cryptocurrency network transaction. In the past, these commissions were insignificant, but recently they have been growing. Most developers and cryptocurrency communities are working to solve this problem, but commissions have become high. For example, at some point the commission for one bitcoin transaction was more than $ 51, but now it has dropped to $ 1-2 – still high, but much less than before.
- Price Volatility:It’s no secret that cryptocurrency prices are unstable. This means that the value of your cryptocurrency will change over time. It is quite possible that the price of your cryptocurrency will fall from the moment of purchase of the goods until the transaction is approved by the network, which will lead to the fact that you will not have time to send a sufficient amount to pay for the goods. Conversely, if the price has increased during this time, you may send too much.
- Not Regulated: Another well-known aspect of cryptocurrencies is that they are not regulated, supported, or guaranteed. This means that you may not be able to get your money back if you are deceived or the exchange where you keep the keys ceases to operate.
- Not Reversible: Once the exchange is completed, it is fixed in the block chain and cannot be canceled. The only way to get the money back if there was an error or a miss is to voluntarily send the amount due to the recipient in another transaction.
- Risk of Loss: As with other types of currency, you may lose your cryptocurrency. You are responsible for the private keys that give you access to your money; if you lose them, they cannot be returned. In addition to losing your keys, you can also lose money if you hold cryptocurrency and its prices fall.
Can I Pay with My Crypto Wallet?
A number of online stores and some brick-and-mortar stores allow users to pay using cryptocurrency wallets.
How Do You Buy and Pay with Cryptocurrency?
The easiest and best way to pay with cryptocurrency is to use a wallet, most of which are compatible with almost all popular cryptocurrencies.
Where Is Crypto Accepted as Payment?
Many online stores and some retail stores accept payment in cryptocurrency through gateways and payment service providers. Newegg, Overstock, Starbucks and Twitch are popular retail companies.
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