What You Need To Know
Relationship Between Bitcoin Payment Services and Credit Cards

Bitcoin, which is known to be one of the popular cryptocurrency today.

Tags: Bitcoin
Sponsored Content ,

Cryptocurrency (illustrative)
Cryptocurrency (illustrative)

Bitcoin, which is known to be one of the popular cryptocurrency today, has been categorized by many as the most secured money on the Internet. With Bitcoin, you can receive payments, and also make payments to people without giving out your personal information linked to bitcoin wallets. As the acceptance and adoption of Bitcoin keep increasing, many business owners now offer payment services which can receive and make payments with Bitcoin.

With these new bitcoin payment services, people can buy a good laptop from big and established companies like Dell by making payments with bitcoin, it can even go as low as buying ice-cream by just scanning some QR code with your phone.

In this article, we will breakdown the way bitcoin and other cryptocurrencies Altcoins payment services work, and also, the associated costs you should know about, also the advantages it has over using your credit cards for payment, and lastly whether they can be threats to the traditional currency payment systems.

When paying for the goods you purchase in a store, you swipe any of your credit card at the counter, input your pin and make payments, same as paying for goods inline, all you have to do is input your credit card details on the website's payment page.

These two payment methods above are processed in the same manner, there exists a payment service system at the backend which authenticates and processes your credit card and makes payment. This same payment service is responsible for transferring the fee from your bank account to the store's and finally, it issued a confirmation for both parties involved.

The Bitcoin payment service also works in a similar way. These services do act as a layer between you and the receiver of the bitcoin payments, Bitcoin payment services will record the transaction process on the blockchain.

Process Involved in Bitcoin Payment Service

  • Customers choose to make payments with Bitcoins on the payment page or in store.

  • They make the payment based on the amount of the exchange rate during the transaction.

  • The service sends every necessary detail to the blockchain network in a very secure way, so the transaction will be authenticated and recorded.

  • For the miners, who participated in verifying and authenticating the Bitcoin transaction and adding it to the blockchain, they will receive their fee.

  • This Bitcoin payment service will convert the paid bitcoins into your Merchant’s preferred currency, this helps to eliminate volatility risk.

  • The money gets credited to the linked bank account.

  • The bitcoin payment service goes as far as converting the received bitcoins into the currency of the receiver's choice.

What are the Advantages of These Bitcoin Payment Services Over the Traditional Payment Services?

The number noticeable advantage that Bitcoin payment services have over the normal transitional payment services or the credit card payment services is the low transaction cost. Bitcoin Payment services mostly charge 1% or less transaction fee compared to fiat traditional payment processing services that charge about 3%.

Another advantage that Bitcoin payment services have over other payment services is the borderless payment activity, this allows people to make Bitcoin transactions in any amount from anywhere in the world. With your mobile phone or computer, you can transfer any amount of Bitcoin to merchants and it gets converted to their preferred currency.

Bitcoin payment services have been designed to be transparent in the ever-changing exchange rates between normal fiat currency and bitcoin. It is much transparent, secured, dependable, and safer for receiving payments.

With this type of service, a merchant is not only open to various mediums of accepting global payments but also has a reliable identity in the world of cryptocurrencies.

Is Bitcoin a Threat to Existing Card Processing Services?

Regulatory agencies and other monetary authorities in the world have been watching the evolution of Bitcoin and other cryptocurrencies. And many of them have accepted the operation of cryptocurrency transactions.

And today we have many Trading sites like bitcoin equaliser platform where investors can trade their Bitcoin like a Pro using its AI-based algorithm to monitor the Bitcoin price chart.

This acceptance has been putting other traditional and card payment services at risk because the one thing Bitcoin has to offer which is the influence of a borderless and also a parallel feature that is not being controlled by any government agencies is what investors love and the security that comes with investing and transacting with Bitcoin cannot be overemphasized.

In conclusion, as the world is trying to completely switch to peer-to-peer Bitcoin transaction dealings, the associated existing organisations who still depend solely on traditional card processing services are feeling the heat, because advances and evolution of new technologies won’t stop anytime soon. This might serve as an advantage for traditional payment services that are looking to adopt bitcoin payment services technology and also offer these services to investors by taking advantage of their known brand names.