Most people have heard of Bitcoin and other cryptocurrencies by now, some associate them with some sort of scam, others think it is going to change the way we look at money forever.
Where ever you sit on this scale, as an eCommerce business it is worth educating yourself on the subject and at least consider if cryptocurrencies fit into your longer term plans for an accepted payment method.
In this article we are going to take a look at what solutions are out there for Magento and how to get things set up.
Before we jump in and take a look at what solutions are available, let’s take a top level look at what a cryptocurrency is and how they differ from more traditional payment methods.
What is a cryptocurrency?
This question alone warrants a full article but on a basic level a cryptocurrency is any currency that is used to interact with a blockchain. Confusingly enough, it doesn’t have to be a ‘currency’ at all. For example VeChain is a project that is used to track supply chains and isn’t a currency in any traditional sense of the word.
Semantics aside, there are a number of more pure cryptocurrencies that act as a store of value and some that seek to be used as a traditional currency on some level. This isn’t to say that this is their only use but it is certainly one use case.
Some of the most popular are:
One of the key differences between these and traditional currencies is that they are on various levels, decentralised. There is no requirement for a bank to act as an intermediary between buyer and seller. Not only this, the decentralised and cryptographic nature of them makes them extremely secure and resilient to fraud.
Whether you believe in the technology or not, one thing is undeniable: there is a portion of people that are adopting these cryptocurrencies and it is happening fast. If it is suitable, why not allow your customers to pay using cryptocurrencies and break down another barrier to purchase in your checkout?
What is available?
We are going to take a quick look at three extensions from the Magento Marketplace that are currently available for Magento and highlight some strengths and weaknesses for each.
Firebear offers support for Bitcoin only. It is available for Magento 2.2 and true to BTC and Magento’s open source roots, it is completely free.
To get going you simply have to setup a Bitcoin wallet. This can be either with a popular cryptocurrency exchange or even better as an offline storage wallet such as a Nano Ledger.
This extension works by placing a QR code and physical Bitcoin address (your address) in the checkout. The user can then either scan the code or manually enter your wallet address and send the funds directly to your wallet. Once the Bitcoin transaction has two confirmations, the order is classed as processed and the user is taken to the order success page. There is no middle man involved in the process at all.
The form is fully embedded into the site and there is no iframe or hosted form required, the user never leaves your site. The amount that the user is charged in Bitcoin is calculated based on the most recent exchange rate between BTC and the currency of the customer’s choice.
The beauty of this as a merchant is that there is zero cost. No setup cost and no recurring fees.
Bitpay Bitcoin acceptance
The second option Bitpay has some slightly different features. For starters this extension is only available for Magento 1 however it does offer support for both Bitcoin and Bitcoin Cash.
It also operates by interfacing with the Bitpay service which in itself acts slightly more like a traditional payment provider where by they process the payment and settle the funds to you 1-2 days after the transaction is completed. There are pros and cons to this: It does mean that payments are not transferred to your merchant account instantly and introduces a 3rd party to the equation but on the plus side it means that you have a point of contact other than the customer should there be any issues with the settlement.
The extension itself is completely free and since Bitcoin does not involve any card processing information there is no need for any level of PCI compliance.
CoinGate Bitcoin & Altcoin Payments
The third and final solution we will look at is CoinGate Bitcoin & Altcoin Payments. This supports by far the most variety of cryptocurrencies out of the three solutions including Bitcoin, Litecoin, Ethereum, Monero, Dash, and Ripple.
This provides your crypto savvy users with much more of a choice when it comes to their preferred method.
Coingate is similar to Bitpay in that it acts as a 3rd party processor and in this case does take a flat 1% fee for processing cryptocurrency payments. They do offer a more robust solution with no chargebacks guaranteed.
This extension’s strength lies in its diversity of cryptocurrency support and more enterprise level implementation. This extension is only available for Magento 1.
In summary the different extensions available have different benefits:
- Firebear: Magento 2 compatible, no settlement provider, free, Bitcoin only
- Bitpay: Magento 1 only, requires a Bitpay account, free, good for small merchants
- CoinGate: Magento 1 only, requires a Coingate account, free, good for larger merchant, charges 1% per transaction.
Each of the solutions offer slightly different solutions to taking cryptocurrency payments. Importantly all three are completely free so it is worth installing and testing these in a sandbox environment if you are at all interested in accepting these type of payments in the future.
It is worth noting that it does depend on your companies brand and user base a lot. Many may not know where to begin with the likes of Bitcoin but make no mistake there is a new generation of individuals out there that are more than happy to spend their cryptocurrency online and this is only set to increase as adoption continues to grow.
As a merchant is important to support your customers in anyway needed, especially when it comes to payment preferences.