Although not yet mainstream payment solutions, cryptocurrency-based payments (also known as Web3 payments) are already bringing benefits such as lower transaction fees, Robert Miller, Vice President of growth at Fuse, a layer 1, EVM-enabled blockchain for launching dapps, asserted. For merchants, Web3 payments have the added benefit of what Miller called protection against “fraudulent chargebacks.”
Crypto Payments Trump Traditional Payment Methods
To back up his claims, Miller claimed that many merchants currently experimenting with or encouraging their customers to use Web3 payments do so because they are looking for a better deal than what they are getting from traditional payment providers.
Miller, however, admitted that Web3 payments are still in their infancy and therefore have some limitations that hinder their adoption. In his written responses to questions from Bitcoin.com News, Miller also highlighted the security challenges that users of Web3 payment methods should expect. Furthermore, Fuse’s senior executive also reiterated the argument that self-custody of private keys is the most ideal and secure method to store its digital assets.
Bitcoin.com News (BCN): What are Web3 payments and why should online merchants care about Web3 payments?
Robert Miller (MR): Web3 payments refer to payments made using cryptocurrencies and blockchain technology. Online merchants should care about Web3 payments as they offer several advantages over traditional payment methods.
First, cryptocurrency payments are faster and more secure due to the immutable nature of blockchain technology. Second, they have lower transaction fees, which can significantly increase a merchant’s profit margins. Third, they enable global reach and expand customer base beyond geographic locations. Fourth, accepting cryptocurrency payments can increase customer loyalty, as cryptocurrency enthusiasts prefer to support merchants who accept their preferred payment method. Finally, in a world where money is reinventing itself, accepting Web3 payments can enhance a merchant’s brand image as an innovative company that values advanced technology and customer privacy.
By using a Web3 payment solution, we remove middlemen from our transactions – banks, payment processors and brokers. Web3 payments are fully peer-to-peer and are built on trustless logic systems, meaning no one has to rely on a third party to facilitate the transaction. More importantly, online businesses and merchants enable instant, borderless transactions with low fees based on the amount sent or received.
BCN: Can you explain why an online shopper should opt for crypto payments rather than e.g. Visa, Stripe or other traditional payment methods supported by merchants?
RM: Buyers should do what is most beneficial to them as a consumer at that time. If the offer is the same as yours and you prefer to use Visa, you must use Visa. The trader, in this case, will pay 3.5% on the transaction. Consider a company making $1 million in revenue per year – that’s a potential $35,000 in Visa transaction fees alone, which is an insane amount of money.
That’s why merchants are increasingly opting to experiment with Web3 payments, often offering discounts or loyalty programs via NFTs or tokens to encourage consumers to use the payment option that helps them save money. money and improve the user experience.
BCN: The Bitcoin network recently saw the number of unconfirmed transactions jump to over 200,000, pushing the average network fee to almost $20. Some have said that such high fees render the argument supporting the use of crypto as a form of payment moot. Do you agree with this statement?
RM: High fees and long Bitcoin transaction confirmation times have been a source of criticism for the cryptocurrency. However, it is important to note that Bitcoin was not designed primarily as a payment system, but rather as a decentralized store of value.
While it’s true that high fees and slow transaction times can make Bitcoin less attractive for small daily transactions, there are still plenty of use cases where it can be valuable. Additionally, there are other cryptocurrencies and blockchain networks specifically designed for fast, low-cost transactions, such as Fuse, Polygon, and Binance Smart Chain. These networks are more suitable for payment use cases.
BCN: Your Fuse blockchain project would aim to enable transparent and affordable crypto payments in everyday life. From your perspective, what do you see as the benefits of accelerating the widespread adoption of Web3?
RM: When big companies like Starbucks, Nike, Adidas, and McDonald’s announce their intention to experiment with Web3 payments, they typically budget for a multi-million dollar POC (proof of concept) budget and assign a dedicated team to manage the project without it doesn’t necessarily have an impact on others. parts of the business in a big way. SMEs and startups cannot do this. So how do they ensure that they participate in the paradigm shift in money?
Fuse provides easy-to-deploy, end-to-end integrated products, including a wallet SDK, out-of-the-box APIs, and mobile wallet tools and infrastructure to level the planning field and ensure that businesses that are the backbone of the economy can play a role.
BCN: What are the advantages of native Web3 solutions such as yours compared to those offered by giants like Visa, Paypal and Stripe?
RM: The future of digital payments lies in Web3 payment services. They offer a range of benefits over traditional payment systems, including lower transaction fees, faster settlement times, increased security, borderless payments, and greater transparency and privacy. As Web3 payments continue to gain traction and gain wider adoption, they have the potential to transform the way we conduct transactions, making them more efficient, secure and accessible.
Compared to traditional point-of-sale (POS) systems, accepting crypto payments offers several benefits, including lower transaction fees, merchant protection from fraudulent chargebacks, increased sales potential, and greater convenience for customers. Additionally, there is a level of anonymity with crypto payments that some merchants and customers may find appealing.
THE Fuse The ecosystem includes 100 integration partners and was built over three years to provide vital services and infrastructure designed to create a robust platform for the adoption of crypto and Web3 payments.
BCN: Your startup reportedly recently launched a $10 million Ignite funding program. What is the purpose of this fund and who are the intended beneficiaries?
RM: As part of our ongoing mission to bring Web3 Payments to enterprise adoption, we are committed to supporting real-world and defi projects. The Ignite program has two main funding areas. The first is a $10 million chain challenge incentive fund, designed to improve the overall financial health of the Fuse ecosystem. The second is to support real-world builders at an early stage on Fuse. Strong on-chain economic activity supports innovation aligned with our North Star to achieve mainstream crypto adoption with payments. Innovation, in turn, supports strong economic growth and activity, creating an inertia effect.
BCN: Like any technology that is still in its infancy, Web3 payment platforms are susceptible to security threats and high costs. What advice would you give to those using Web3 payment solutions for the first time?
RM: Web3 payments are still in their infancy and have some limitations that should be considered before using them. Web3 payments may be subject to security threats and high transaction costs, as several networks have yet to successfully resolve these issues. Fortunately, Fuse doesn’t have these issues and can process transactions in less than 5 seconds for less than a penny.
Additionally, merchant acceptance remains a challenge, and there is a lack of understanding of the importance and impact of blockchain-related concepts. Scams and fraudulent activity happen everywhere, and it’s essential to stay safe and vigilant when it comes to Web3 payment solutions. Never share private keys, double-check wallet addresses and networks before sending crypto, and watch out for scams or fake sales on social media.
Additionally, centralized exchanges can disappear and take your crypto with them, so owning your keys and using non-custodial wallets is vital. Finally, taxation is key, and anyone dealing with Web3 payments should know how they are taxed in their region.
What do you think of this interview? Let us know what you think in the comments section below.
Image credits: Shutterstock, Pixabay, Wiki Commons
Disclaimer: This article is for informational purposes only. This is not a direct offer or the solicitation of an offer to buy or sell, or a recommendation or endorsement of any product, service or company. bitcoin.com does not provide investment, tax, legal or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.