Cryptocurrency payments are a long way from hitting the mainstream, but the list of what you can buy with Bitcoin is continually growing.
The main downsides to the adoption of Bitcoin (BTC) payments are threefold. First, the world’s dominant cryptocurrency is extremely volatile — meaning the price of a product in BTC can rise or fall substantially in a matter of minutes. The prospect of getting a 20% discount off your morning coffee in dollar terms might seem appealing at first, but the fact that the cost could soar 20% in the time it takes to brew the beans is not. Second, retailers and businesses often lack the infrastructure to accept cryptocurrency payments — leaving consumers with little choice but to continue using fiat currencies. And thirdly, the industry is complicated to understand and has some issues with scalability, meaning existing infrastructure is more practical.
What to buy with Bitcoin
Despite these drawbacks, more than 360,000 Bitcoin (BTC) payments were made on September 18 alone — and daily transaction levels are high. The cryptocurrency is proving itself to be more than a store of value — and an asset that can be used as a medium of exchange. This is particularly useful in countries affected by hyperinflation, where national currencies are so unstable that people need rucksacks of cash in order to purchase a loaf of bread. For example, demand for Bitcoin has been soaring in Venezuela.
So here’s the question: what can you buy with cryptocurrency? Here are just a few real-world examples that have emerged:
- Food and drink.
Some of the biggest brands in the world — 0'>Starbucks and Whole Foods Market among them — have begun to accept cryptocurrency payments in Bitcoin, Ethereum, Bitcoin Cash and Gemini dollars. This is through a platform called Spedn, which enables consumers to make purchases through an app on their smartphone. The funds are instantly converted to local fiat currencies on behalf of the merchants.
- Retail.
While fashion brands such as 0'>Nordstrom are also using Spedn, other major retailers have been flocking to rival payment processing companies. 0'>Overstock, which sells everything from home furnishings to electronics, has really opened up the options of what you can buy with cryptocurrency. Completing a transaction in BTC is as simple as switching payment methods at the checkout.
- Small businesses.
In a world of e-commerce, small and niche merchants have moved from quaint shopfronts to the world wide web. Many use plug-and-play platforms such as 0'>Shopify, which allow them to embed secure payment gateways into their existing sites. For several years, the company has enabled shoppers to pay with hundreds of digital currencies — and given how an estimated 800,000 stores use Shopify’s technology,
- Video games.
Major industry players such as 0'>Microsoft have allowed gamers to use BTC for credits in the Xbox Store for several years now. Bill Gates is known to be a vocal fan of cryptocurrency, and has been quoted saying that he believes Bitcoin is superior to the likes of the US dollar and British pound.
- Property.
There has been a growing trend for real estate to be sold in BTC. Back in March 2019, it was announced in Australia that a luxurious house was going up for auction, with bids accepted in both 0'>Bitcoin and Binance Coin, a rival digital currency offered by a crypto exchange. This was described as a world first, but there certainly have been house purchases executed using crypto before then. Back in 2014, BitPay was instrumental in helping a property in Lake Tahoe sell for a whopping 2,739 BTC — worth $1.6 million at the time. Today, that self-same BTC would be worth more than $27 million, meaning the sellers are laughing all the way to the bank. Certain parts of Canada have also begun to accept BTC as a payment method for settling property tax bills.
- Fast food.
Some restaurants operating under the Subway and Burger King brands have been known to accept 0'>BTC in the past. Recently, the German arm of BK made headlines when it announced it would allow cryptocurrency payments through its online delivery service. Alas, it’s fair to say that Bitcoin has struggled to gain traction as a common method for paying for food, and this harks back to 2010, when one man paid 10,000 BTC for two pizzas. Although Laszlo Hanyecz was trying to prove Bitcoin worked, he ended up paying more than $100 million at today’s rates.
- Flights.
Several travel businesses have cropped up which allow consumers to pay for air fares and hotel bookings in Bitcoin. For several years, market leader Expedia was one of them — but the service it launched in 2014 was quietly withdrawn four years later, and volatility in the market was a likely factor.
Cryptocurrency payments: Some fast facts
Despite the fact that businesses across multiple sectors are accepting Bitcoin with open arms, it seems like there is much more work to be done — both within the crypto sector and outside of it. A February 2019 report by the Foundation for Interwallet Operability found 18% of those polled had actually lost money because of a user error, 6% had lost money because of a malicious incident such as a phishing attack, and just 25% are very confident that a transaction would be completed as planned. Also revealing is the fact that only 11% of those surveyed bought something with crypto at least once a week.
Developments such as Facebook’s Libra coin may help introduce crypto to the masses, but as things stand, the likes of Bitcoin could end up being on the sidelines for some time yet.
