Pervasive’s Brian Stein was quoted this morning in a Mobile Commerce Daily article discussing the rise of Bitcoins as an alternate currency and payment mechanism. The article looked at the question of “Should retailers begin accepting Bitcoins in-store and on mobile?” and included viewpoints from Pervasive Path, Strategy Analytics, Yankee Group and Retail System Research.
The prevailing opinion is that while Bitcoins are gaining traction as a form of currency, they are far from making the jump to mainstream and therefore should not be a priority for adoption on the mobile channel, unless your specific customer segment has demonstrated a desire to use them.
In addition to the anonymity that Bitcoins are most famous for providing, there are additional benefits that may be attractive to retailers in certain cases:
Similarly, Brian Stein, managing director at Pervasive Path, Cleveland, OH, does not think that retailers need to integrate Bitcoins in mobile sites and apps in the near future, but he does see why the currency could be beneficial in the mobile space.
“Because of the transaction fee structure that Bitcoins provides, they work very well for micro-payments,” Mr. Stein said. “Lowering the threshold for purchase volumes allows for more buying opportunities on the mobile channel.
“Additionally, the easy integration of Bitcoins into a mobile app, and the fact that the security is handled by third parties, lowers the barriers to adding Bitcoins to mobile applications and for merchants to accept Bitcoin payments.”
However, it is important to distinguish between the underlying currency and the payment gateways which enable transacting in that currency. Based on the current usage levels of the currency, retailers should not focus on providing the payment gateways and should consider leaving it to mobile wallet players to decide if they want to act as an intermediary:
“If Bitcoins continues to gain traction, I see it being adopted as a back-end payment method for other wallet solutions,” Pervasive Path’s Mr. Stein said.
“For example, Google or PayPal may choose to provide you to check-out using PayPal, or Google Wallet, the funds would be withdrawn from your Bitcoins account rather than a traditional bank account or credit card,” he said. “I don’t see Bitcoins gaining the critical mass required in terms of merchant acceptance to grow beyond that as an independent alternative to the big guys.”
Read the complete article here.
