How Cryptocurrency Can Save Retail Profit Margins


Could Bitcoin save ever-shrinking retail profit margins? If cryptocurrency replaced credit cards in stores across the world, merchants could save big. Bitcoin was designed as a decentralized currency that provided lower transaction fees and faster processing times outside of the banking system. Compared to credit card transactions, cryptocurrency could prove a faster, cheaper solution for retailers. For those readers who don’t know much about this new revolution in decentralized currency, it’s worth setting aside some time to learn about cryptocurrency.


Paying with your credit card can seem instant and easy, but there’s more to the process than meets the eye. It’s both expensive and time consuming for the retailers who accept credit cards.

Credit card companies don’t make life easy for retailers. Credit card processing fees take a major bite out of retailers’ profits. Most major credit card companies charge processing fees between 2.5% and 3%, all taken out of the merchants’ pockets. Cards like AmEx charge even more, up to 3.5% depending on the type of business. Although in some states, merchants are allowed to pass on the costs of credit card processing fees to the consumer, most eat the costs. Ecommerce and online transactions can face even higher fees than their brick and mortar counterparts, and the majority of online payments are made with credit.

On top of the processing fees, it takes time for merchants to find the money in their account. Merchants collect credit card payments all day before batching the payments when they close up and send them to be funded. It can take days or even weeks for the funding to come through. Meanwhile, they have staff to pay and inventory to replace.

An alternative like Bitcoin or Bitcoin Cash, where funds are processed within minutes and transaction fees are smaller, suddenly cryptocurrency becomes an attractive option to retailers big and small. Faster cash and lower transaction fees mean they keep more of their sales and get access to their revenues sooner.

The biggest obstacle to widespread, in-store cryptocurrency use is going to be consumers. Not only are credit cards convenient, they offer consumers a pain-free shopping experience. Consumers can buy now and pay later. But a growing number of consumers are becoming interested in using cryptocurrency for their everyday purchases, thanks in part to cryptocurrency exchanges like that make it easier and more affordable to buy Bitcoin with debit. Shopping with Bitcoin has its anonymity advantage after all, particularly if you first buy a VPN with Bitcoin. Easier consumer access to Bitcoin combined with wider merchant acceptance are necessary before Bitcoin can replace credit cards. There’s also the issue of wallet verification, but there’s a strong case to be made that the technology already exists. For example, wallet verification could come in the form of a fingerprint, similar to how Apple Pay works.

Touch ID

As Bitcoin and other cryptocurrencies mature and prices stabilize, expect to see more retailers accept payment in crypto online and even in-store. Cryptocurrency as retail cash could also see its first big lift from travelers. Consumers eager to save on the exchange charges they see when they use their credit cards abroad stand to save considerably by making the switch to Bitcoin payments.

Cryptocurrencies are still in a nascent phase. Sharing space with credit cards at the cash register is only one-way cryptocurrency could evolve. As the benefits to retailers become clearer, expect to see more Bitcoin transactions happening in store.

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