[2019-03-13] Accepting bitcoin without a payment gateway

[btc_enigma]

So you created a bitcoin wallet, did a few transactions and are loving the cryptocurrency memes and financial freedom. Surely its time now to accept bitcoin payments on your online boutique!

Do you really need a bitcoin payment gateway ? Isn’t having a bitcoin address enough? Why use a custodial payment gateway for a currency meant to regain monetary control ?

 

The answer is NO. You don’t need to use a payment gateway to accept bitcoin payments on your website

The below article builds upon on how a merchant can create a bitcoin payment processor from scratch

https://blog.blockonomics.co/accepting-bitcoin-do-you-need-a-payment-gateway-832487d3b84c

[Naida_BR]

LOL! I was so interested to see how it is possible for a boutique to accept bitcoin without a payment gateaway but you ruined my dreams!
Gateaways provide safety for both counterparts and I think it is essential to keep it that way...

[NeuroticFish]

Do you really need a bitcoin payment gateway ? Isn’t having a bitcoin address enough? Why use a custodial payment gateway for a currency meant to regain monetary control ?

Most merchants prefer to get fiat at the end of the day, even if maybe they do like Bitcoin, financial freedom and maybe memes too.

And that's because in many cases Bitcoin could be a headache tax-wise. And they maybe don't want (or couldn't find?) to hire somebody help them out. In many countries the tax is just plain stupid and also the people are not educated in this direction.

So imho the last "No! Please Skip this Step !" is much more useful than you'd think.

[buwaytress]

I think yeah, sure, why not? One day, when everyone knows how to properly make spends, owns their own wallets, put a reasonable fee, signs their own transactions and maybe also when things are priced in Bitcoin.

Just too many variables, especially on the consumer side:
"gee, how much is $5 in Bitcoin now?" or
"hmm, which address should I sent it to, Bitcoin Core or Bitcoin Cash? Where is Bitcoin?"

Sort of why Bitpay's invoicing is (was?) so popular with merchants, other than that they want to file their books and taxes in fiat.

But I do agree. Building your own gateway is bettah... BTCPay is a good move away from the silliness of Bitpay.

[Thekool1s]

Merchants who want to instantly convert BTC to fiat are leechers and they shouldn't be catered. I like how the article says "No! Please Skip this Step !" but then follows up that to remain safe from fluctuations one should convert BTC to Fiat. Unless it is a 100% BTC only business I don't see where the risk is? How much % of these sales come from BTC? I doubt its a larger figure than 5%. I mean if you are that desperate for that 5% I would say it's about time you re-evaluate your business. One could argue a corporation like Microsoft might take that 5% seriously and it could affect their profit margins but these hundreds of merchants aren't Microsoft they are small businesses and holding BTC would benefit them in the bigger picture.

[joniboini]

One problem that businesses may encounter if they only provide btc address for payment is how to detect which payment comes from which customer. If the owner is tech savy or at least have some decent knowledge on Bitcoin it may not be a big problem, but still takes time. Efficiency is a must in business so using payment gateway looks like a great alternative for them instead of preparing their own check management.

[bL4nkcode]

One problem that businesses may encounter if they only provide btc address for payment is how to detect which payment comes from which customer.

Well they should pair it with even just email. I have an small online shop where I accept btc but never used any payment gateway because of high fees and etc. Instead I just use my btc addresses where I add all my address in a list, and randomly it appear on payment page, once there's a purchase I get the record of unique id, email ofc and the same time the address to identify which the payment came from, once a payment was made, some email notification that will be received by me then process the purchase manually.

The disadvantage is the address may be used again but that's not an issue to identify the purchase, date time record may vary for that.

[magneto]

So you created a bitcoin wallet, did a few transactions and are loving the cryptocurrency memes and financial freedom. Surely its time now to accept bitcoin payments on your online boutique!

Do you really need a bitcoin payment gateway ? Isn’t having a bitcoin address enough? Why use a custodial payment gateway for a currency meant to regain monetary control ?

 

The answer is NO. You don’t need to use a payment gateway to accept bitcoin payments on your website

The below article builds upon on how a merchant can create a bitcoin payment processor from scratch

https://blog.blockonomics.co/accepting-bitcoin-do-you-need-a-payment-gateway-832487d3b84c

I think that ultimately, this is the type of adoption that we should look forward to.

People accepting bitcoin through third party payment gateways or processors that hold your funds in custody for you and/or convert the payments to merchants to fiat in real time isn't really accepting bitcoin, imo, because you're never the one holding the actual bitcoin in your own address.

That's the problem with some merchants that accept bitcoin at the moment, because they see the volatility as an issue and threat. They use these third parties which not only could potentially be risky, but also essentially degrades bitcoin's utility from a full currency to just a payment processor.

In the future as volatility decreases, we should see more people accept BTC on-chain, without any third party intervention and conversion to fiat, or at least using open source payment gateways. That in itself should boost others' trust in BTC as a means of payment as well.

[1Referee]

Merchants who want to instantly convert BTC to fiat are leechers and they shouldn't be catered.

How are they leechers? They are trying to gain more exposure by accepting a hot new internet currency thingy. It makes sense to convert it to fiat for them, because it's too volatile, and they can't use it to restock because that still requires fiat money. In the end, we should be happy that we can have all sorts of merchants accepting it. I am grateful for that.

I mean if you are that desperate for that 5% I would say it's about time you re-evaluate your business. One could argue a corporation like Microsoft might take that 5% seriously and it could affect their profit margins but these hundreds of merchants aren't Microsoft they are small businesses and holding BTC would benefit them in the bigger picture.

5% is huge, especially when it comes to things like domains, giftcards, electronics, foods, etc. In this case the business model isn't the profit margin per product, but profit margin per x amount of sales volume. Waiting to generate x amount of sales volume with Bitcoin isn't worth the risk. Businesses need constant cash flow, they aren't here to speculate.

[BitHodler]

But I do agree. Building your own gateway is bettah... BTCPay is a good move away from the silliness of Bitpay.

I wish that merchants looking to accept Bitcoin were aware of how toxic BitPay actually is, but they aren't and for that reason will continue to pick BitPay over anything else in the market.

BTCPay needs some more marketing in order to gain the exposure it deserves, but then again, who's marketing something that's open source and free to use? That's what OpenBazaar has to deal with as well.

BitPay has a gigantic stack of money to blow on marketing with backers such as Roger Ver and Bitmain. It's so unfortunate that the wealthiest entities in the space are against the hand that fed them.

[Thekool1s]

How are they leechers? They are trying to gain more exposure by accepting a hot new internet currency thingy.

How is it exposure if they are just using a plugin to do all the work for them? They are still getting that cash at the end of the day without interacting with the "hot new internet currency". Obviously, things like BTCPayServer are the real deal, no instant conversion to fiat and actually forces them to interact with the "internet currency".

because it's too volatile, and they can't use it to restock because that still requires fiat money.

Agreed! they do but they are here to make a quick profit remember. Instant dumping shouldn't be a thing. Its a backstab to the people who are actually using the "hot new internet currency". User X holds BTC for a year, Makes a purchase with his new gained profit. The merchant dumps the BTC instantly causing the market to go down. Backstabbing the user who hodled for a year. Does that make sense?

5% is huge, especially when it comes to things like domains, giftcards, electronics, foods, etc.

I dunno, if you have worked on a dropshipping gig or not but the profit margin is almost about 100% on each sale. 5% isn't huge in any way.

Businesses need constant cash flow, they aren't here to speculate.

Agreed but remember we are here to make everyone accept BTCs eventually. So maybe these merchants can start convinces their suppliers to accept the hot new internet currency which they are accepting no? 

[1Referee]

How is it exposure if they are just using a plugin to do all the work for them? They are still getting that cash at the end of the day without interacting with the "hot new internet currency".

Exposure = offering people the ability to use Bitcoin as money, doesn't matter how it happens. Without merchants doing this, the pool of merchants accepting Bitcoin directly will be so insignificant, that you'll burst out laughing hard.

Even the businesses dealing with Bitcoin only have to convert a chunk of their coins to fiat. Fiat pays the bills, Bitcoin does not.

Instant dumping shouldn't be a thing. Its a backstab to the people who are actually using the "hot new internet currency". User X holds BTC for a year, Makes a purchase with his new gained profit. The merchant dumps the BTC instantly causing the market to go down. Backstabbing the user who hodled for a year. Does that make sense?

Payment processors don't dump their coins instantly. They short a percentage of whatever they hold in BTC to retain their $$ value, then slowly unload the rest for fiat to not affect the price too much.

I dunno, if you have worked on a dropshipping gig or not but the profit margin is almost about 100% on each sale. 5% isn't huge in any way.

The industries that I mentioned work with very tight margins. The local super market here makes less than 5% per sale, because there is no way to squeeze out more due to the competition. If you try to do so, people switch to another super market offering the same product for a lower price.

Agreed but remember we are here to make everyone accept BTCs eventually. So maybe these merchants can start convinces their suppliers to accept the hot new internet currency which they are accepting no? 

That would be ideal, but then again, how do you think these suppliers will try to hedge the risks associated with Bitcoin? 

[Thekool1s]

So basically Damned if they do, Damned if they not.

[milewilda]

One problem that businesses may encounter if they only provide btc address for payment is how to detect which payment comes from which customer. If the owner is tech savy or at least have some decent knowledge on Bitcoin it may not be a big problem, but still takes time. Efficiency is a must in business so using payment gateway looks like a great alternative for them instead of preparing their own check management.

Payment gateway gives out convenience on merchants side and as said above most of them would prefer to have that direct fiat-conversion even
if they do love bitcoin.This is why we do really see that these gateways are much more preferred unless if a certain merchant chooses up to give its own
bitcoin address and decides to accumulate itself and later on would be converted.It only depends on ones choice.