The director of European business development at BitPay, Moe Levin, recently went on record with some interesting comments at the Webit Digital Commerce Summit, MENA that took place at Madinat Jumeirah in Dubai back on April 30, 2014.
Banking on the future
The event was covered by UK’s Startup Magazine, which interviewed the recently-appointed
regional director at BitPay. From the bustling
payment processing company’s point of view, Levin describes the problem with the lack of understanding buyers and merchants have with regard to Bitcoin and its advantages:
“Right now it is an educational game — people need to understand what it is, why it’s useful and why credit cards perhaps are not the most useful way to pay for things online.”
When describing the cryptospace as a whole, Levin compared the landscape to the advent of the Internet of the early 90s. “In the beginning of the 1990s people couldn’t understand why anyone would want to read a newspaper online when you can go down the street and buy it,” said Levin, “Not having an internet strategy in 1995 is the equivalent of not having a Bitcoin strategy now.”
“Not having an internet strategy in 1995 is the equivalent of not having a Bitcoin strategy now.”
Moreover, David El Achkar, who founded Yellow, a company that provides Bitcoin payment products to firms in the Middle East, recently echoed
Levin’s analogy to the invention of the Internet at the ArabNet Digital Summit in Dubai:
“It’s like pre and post-internet times. Bitcoin as a technology … allows anyone to innovate … with value. We now have this platform that enables completely permissionless value transfer. Which is very exciting.”
Much like the initiatives back in the late 80s and early 90s, which required every classroom to be equipped with a computer to familiarize and prepare children for the future, it seems that we are headed for a similar scenario less than 20 years later thanks to yet another technological innovation. And as Moe Levin appears to be hinting, the future will certainly be bright, especially for those who are prepared and knowledgeable about cryptocurrencies.
The incentives are certainly there as pointed out by a report published by Goldman Sach’s Roman Leal who described the benefits both merchants and consumers could obtain if Bitcoin were used in retail environments instead of conventional bank transfers.
The IT Services analyst’s findings showed that in a retail environment, transaction fees on average can range anywhere from 2.5 to 3%, which resulted in $US 260 billion from $US 10 trillion in sales in 2013 globally. By comparison, using Bitcoin would have reduced that amount by more than half or almost $US 150 billion.
However, Leal noted that adopting Bitcoin will be especially attractive for small businesses that are operating under low profit margins. It is these businesses in particular who can cut their transaction fees by almost half.
Unfortunately, many small businesses are unaware that making such a transition does not equate to a leap of faith with huge risk. On the contrary, Moe Levin explains why these concerns are groundless:
“If the market in which they operate is still not ready, they could integrate Bitcoin. It’s not about either/or, but about adding layers to your company. It could be just another stream in addition to all other methods of payment they are using.”
Besides an additional stream, Bitcoin could offer merchants other advantages over fiat such as speed, no chargebacks, and anonymity particularly for merchants and buyers in countries with strict capital controls.
Thus, educating people about the benefits of Bitcoin may seem similar to explaining the Internet to someone in 1995, but the ubiquity of the Internet today has proven just how important that education was. And many Bitcoin-enthusiasts would agree that making people understand how the nascent technology can potentially benefit mankind is one of the biggest hurdles remaining between digital currency and the mainstream.