Beginning in November of 2013, Shopify took the intriguing first step toward becoming a major e-tailer to accept bitcoin. The digital currency uses peer-to-peer networking to transfer money, but it is also a digital currency users can exchange as payment. The question is whether the currency has any real hope of survival…
Shopify is betting on convenience. They say that shoppers can use the currency from anywhere in the world and the buyer is more secure. They claim the transactions work just like cash, and buyers can choose to receive payment in the form of bitcoin or actual cash.
If you’re interested in adopting bitcoin for your business, take a look at how companies are already cashing in.
Bitcoin Value
The value of the bitcoin itself has reached the $1,000 mark according to BBC News. That means that a single bitcoin is now worth a cool grand, and that’s got bitcoin developers excited over the possibilities. One website, pizzaforcoins, allows users to pay for goods with a fraction of a coin. The availability of these services, coupled with the ease of use, is part of what is driving the value of the bitcoin.
The currency is not infallible. The Chinese see the currency as a reliable method to move money out of the country, but a panicked selloff can have dramatic consequences for those who hold bitcoin. These fluctuations are pushing economists to label bitcoin as a kind of stock, rather than a currency. That definition has broad reaching consequences for how the currency can be used.
Reveal Sealed Information
Proof of Existence is a program that uses bitcoin to essentially reserve a slot for data storage. This is important for financial documents that are best kept secret, but may occasionally come into play during legal matters. Using bitcoin, the user can store proof of his data without having to produce the data in court.
With a newfound interest in privacy, users will need services like PoE to protect themselves.
Barter Must Occur
Shopify’s decision reinforces the basic foundation of currencies: something only has value when it’s exchanged for something else of value. Even if the value is perceived, it’s still important that the monetary exchange match that perception. Some economists argue that bitcoin is limited, and that the currency will increasingly compete with a limited amount of “issued” coins and an infinite number of services to purchase. Minting new coins will drive the value lower, as we saw in the American and Greek dollars these past few years.
There is no simple solution to this issue, and it may continue to be a thorn in the side of the growing currency. That doesn’t seem to bother Shopify though.
Security Concerns
Your bitcoin wallet could, understandably, become the target of hackers. Who would steal your mailing list when your company’s revenue is invested in virtual currency? This has placed an increased emphasis on network security solutions that provide total security. Antivirus apps no longer just diagnose and remove infections. Today, a program needs to check your email attachments and guard your browsing in real-time.
As people become increasingly conscious of the security risks they face, bitcoin’s security risks will become less of an issue. Until companies embrace total security, bitcoin will face challenges from the privacy-conscious. This means going beyond the average anti-virus and malware checkers. If you’re trading in bitcoin right now, you need something more robust, something that can go deeper into your system, where the hackers are learning to attack.
That “deep discovery” and “advanced network security” styled network protection is something that many companies like Trend Micro have recently started offering clients, possibly in an attempt to keep up with the demand for added security in the face of currency hackers. These are systems that focus on hacker behavior, like rapid, targeted and persistent threats (like the bots that try to guess a password by throwing millions of different Captcha solutions at a gateway every minute).
Global Transfers
In China, bitcoin makes it easy to move currency out of the country. The digital currency may be a viable solution to get money to people in need, circumventing the crooked politicians and middle men in the way. This not a golden ticket to end world poverty, but it is possible that direct money transfers will actually benefit the intended recipient with digital currency.
The world of bitcoin does leave a lot to chance, but companies are already adopting the currency with positive effects.
Featured Image Credit: Golden Bitcoins/ShutterStock
