Have you ever wondered why you don't see any transaction fees when you make transactions via GrabPay or VISA? It's because these fees are usually charged to the merchants and ultimately passed on to you. On the merchant end, merchants may have to wait for days till they receive that amount in their bank account. But what if there was a way to revolutionize the micropayment industry and eliminate these hidden fees, and make all payments instantaneous? Enter Blockchain, the decentralized, secure, and transparent technology that has the potential to change the game. In this blog post, we'll explore how Blockchain can transform the micropayment industry and make transactions faster, cheaper, and more secure for everyone involved.
Current payment solution such as credit card, Paypal, and even new payment methods such as GrabPay or ShopeePay has many limitations. Let’s first look into some advantages of blockchain technology over current payment methods.
Currently, fees are between 1% - 3% (some charge an additional base fee) to the merchant, which will be passed on to the end consumers. That’s up to $0.84 for a $10 transaction and $3.90 for a $100 transaction. On the other hand, transaction fees on the blockchain will be as low as $0.00025 per transaction, regardless of the amount.
Most payment wallet has a mininum top-up value of $10 (GrabPay, ShopeePay), and a daily transfer limit, whereas there’s no minimum or maximum limit on the blockchain
Creating an account can take a few hours to days, however, creating a wallet on the blockchain takes less than a minute.
Unlike traditional banks which have strict processes in place to ensure that they are in compliance which includes collecting and verifying customer identification documents, the decentralized nature of blockchain technology provides greater financial inclusion.
Converting cryptocurrencies and fiat (SGD) is a complex process that requires the use of bank accounts in many cases. The world's economy is still primarily based on fiat currencies, making the conversion between crypto and fiat an essential aspect of the crypto space for the time being. While peer-to-peer transactions can eliminate the need for a bank, users often need to convert their crypto to fiat to use their funds.
The world of cryptocurrency regulation is still in its infancy and a work in progress. Many countries lack clear and established laws on the matter, which pose challenges for merchants and businesses looking to accept cryptocurrency payments, as they may not have a clear understanding of their legal obligations. As a result, the lack of regulation can hinder the growth and development of the cryptocurrency micropayment industry. To fully realize the potential of this technology, it is crucial that clear and effective regulation is put in place to ensure the safety and security of users, merchants, and the overall ecosystem.
Embracing cryptocurrencies and blockchain technology can require a certain level of technical knowledge, which can be a barrier for many users. For the wider adoption of cryptocurrencies and blockchain technology, education is a crucial component. Without it, many potential users will be intimidated by the technicalities and complexities of the technology, resulting in fewer individuals participating in this innovative space.
While it’s worth noting that some of those limitations are fraud prevention methods to allow the freezing of assets, similar techniques can also be applied to blockchain payment solutions while retaining benefits such as no minimum transaction limit and low processing fees.
.svg)
.svg)
