E-commerce giant Shopify has added Solana Labs’ decentralized payment protocol, Solana Pay, to its platform, providing customers with more crypto payment options, beginning with USDC.
The integration allows users to connect their Solana-based crypto wallets, such as Phantom or Slope, to Shopify. Businesses can also use Solana Pay to create unique loyalty programs using Web3 tools like NFT loyalty tokens. There are also special discounts and rewards.
Shopify chose to start with USDC because merchants are more likely to accept the token. USDC is closely tied to the U.S. dollar and is more regulated than other altcoins. Consumers are also familiar with transacting in digital dollars, making USDC a more attractive payment option.
“It creates a much simpler entry point when pricing is in a currency consumers and merchants naturally understand,” said Josh Fried, head of commerce business development at the Solana Foundation.
According to Fried, Solana Pay offers businesses a more efficient and cost-effective way to accept payments. USDC transactions on Solana’s blockchain are settled almost instantly, and the average cost per transaction is only $0.00025. It is significantly lower than the processing fees charged by credit cards, which range from 1.5 to 3.5 percent per transaction.
“With no intermediary, Solana Pay eliminates bank fees, chargebacks, and holding times while enabling immediate, direct payment settlement of USD stablecoins compatible with Solana,” Solana wrote on its X page.
Several crypto-focused entities, including Helius, Mad Lads and MonkeDAO, have already signed up to use Solana Pay on their Shopify marketplaces.
Solana has had some downtime issues in the past, leading to concerns about its reliability. However, the blockchain reported 100 percent uptime in Q2, serving a positive outlook for the future.
This integration is Shopify’s next step in expanding its crypto payment options. In February, it launched blockchain-enabled commerce tools and features, which allow NFT merchants to “tokengate” – dictating which token holders are eligible for exclusive products, NFT drops and benefits.
Shopify is also integrated with Coinbase Commerce, Strike, Crypto.com and BitPay. It already accepts payments in major tokens like Bitcoin and Ether.
The use of cryptocurrency in e-commerce has been growing for various reasons, including the increased popularity of digital currencies and the increasing crypto adoption among consumers and merchants.
E-commerce businesses can benefit from accepting cryptocurrency payments in several ways besides increased efficiency. Cryptocurrencies are universally accessible and inclusive, making them a viable payment option for customers worldwide. Crypto transactions are also secure and decentralized, reducing the risk of fraud and censorship.
Crypto proponents also argue that digital currencies can revolutionize B2B transactions in e-commerce by streamlining the process, reducing friction and providing data-driven insights.
Shopify is not the only one among mainstream e-commerce that accepts crypto as a payment method.
BigCommerce currently offers two cryptocurrency payment gateways — BitPay and CoinPayments. Both are top-rated gateways that help customers pay in almost any token from various crypto wallets.
WooCommerce is another e-commerce platform that supports cryptocurrency payments, with over 17 available plugins. These plugins allow merchants to accept payments in Bitcoin, Ether, Litecoin and other cryptocurrencies.
Magento offers a broader range of crypto payment gateways, up to 18. These gateways allow merchants to accept most cryptocurrencies. It also supports the immediate transfer of tokens into fiat currencies.
Just like other payment options, crypto has several disadvantages. Users face price volatility and crypto taxes in certain jurisdictions. As a relatively new sector, crypto payments are still not as regulated as their traditional counterparts.
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