If you’re one of those people wondering “where can I spend bitcoins?”, this article is for you!
Even if you have been living under a rock, you will no doubt have heard of the success of Bitcoin. However, in 2018 the cryptocurrency although it is decentralized and therefore borderless and unregulated, has proved to be extremely volatile.
Nonetheless, Bitcoin has enormous potential to change the global economy for both trading and hedging offering users inflation proof, secure financial transfer without central government control. The meteoric rise of bitcoin in 2017 piqued the interest of online moneymakers worldwide. Although many people look to BTC as a long-term investment asset, “Satoshi Nakamoto” designed the crypto as a decentralized currency for online payment of goods and services.
International regions that are either underbanked or unbanked, bitcoin has become a source of digital payment and money transfer on a peer-to-peer level through smartphones, without holding traditional bank accounts.
How to Spend Bitcoin in the Real World
For many people around the world, Bitcoin has become like using traditional money (fiat currency). Some Bitcoin owners prefer not to have a regular current account; others want to use funds tied up in cryptocurrency wallets. The cryptocurrency ATMs permit people to do everything while on the move, and nothing is stopping an international traveler from using only Bitcoins, instead of trading fiat currency through Foreign Exchanges.
Why do Fees Matter?
Bitcoin transactions are publicized to the global network, where miners verify them in “blocks.” Each miner (computer) receives payment in the form of a Bitcoin “bounty” or a transaction fee, which subsequently passed on to the user. At the end of 2017, charges (fees) had risen from just a few cents per transaction to over $35 each because the transaction time had slowed down due to the spike in numbers.
During 2018, the mining “hashrate” (computation speed at which bitcoins are scaled and secured) is three times higher than previously. This means that miners have invested in better “mining rigs” or hardware known as ASICs (Application Specific Integrated Circuit).
This is important to someone spending Bitcoin because the fee depends on the size and completion time of each transaction. It affects the buyer because there is a charge on top of the purchase. It also goes some way to influencing suppliers who might not want the added hassle of accepting Bitcoin payments where the fees are too variable.
Bitcoin Wallet in a “Real Store”
Using Bitcoins is not always the easiest option because not all shops have embraced cryptocurrency as a form of payment. However, more and more shops around the globe are taking Bitcoin as payment through various “wallets.” The vendor generates a code, which is then scanned using a smartphone to make the transaction. This link will show you where there are brick-and-mortar shops taking crypto cash. Coinmap is another source of information.
Bitcoin Debit Cards
Pre-loaded debit cards (Wirex, Xapo, Bitpay) offer a unique way to use Bitcoin. The card company stores the coins. When the debit card is swiped, the balance is recorded much the same way as using fiat currency bankcards. The bitcoin hash function is not required because you have already used it when you initially loaded the card.
The Bitcoin Debit Card can be either plastic or virtual (mobile phone app) and operate in an almost identical way to regular bank cards.
The ease with which Bitcoin Debit Cards can be used has apparent advantages because they will operate all over the world in any store where “merchant cards” are accepted. The merchant/shop owners receive payment in their fiat currency. Using this unique debit card gives bitcoin owners the advantage of using bitcoins as a single means of the transaction without having to use foreign currency when traveling internationally. Small payment amounts often do not require ID-verification. This means that they are even more anonymous than bank debit/credit cards.
Decentralized becomes Centralized
There is a downside to using the debit card system: decentralization is not long in play because there is now the “middle-man” card company. A second problem may arise through governments vacillating over legislation, where a card company is shut down, and your card will stop working immediately and without warning. Some purists believe that removing the decentralized peer-to-peer bitcoin protocol and going back to a centralized banking method defeats the blockchain model. It also puts people back into a vulnerable position through central government interference unregulated currency.
This was evident when VISA suddenly ended their support of cards in January 2018. There is no indication to date whether VISA will get back in the system. It means that there is still skepticism among the traditional banking fraternity due to the central government shifts in legislation. Nevertheless, for as long as there are other debit card providers, this form of payment is low cost and very convenient for users worldwide.
Through a Third Party/Intermediary
If you are willing to part with your coins to a third party or intermediary agent, such as All3Bitcoin, they will exchange your BTC for items from online stores. It gets around the problem where stores do not have the bitcoin payment option.
With companies like ‘Gyft’ and ‘eGifter,’ you can exchange Bitcoins for gift cards that are redeemable online or instore for Target, Amazon and Walmart and many others.
The uses of Bitcoin continue into investment in many asset forms. Here are three ways to use Bitcoin other than keeping it in a wallet for a rainy day.
Buying gold is an excellent method of hedging against inflation. Bitcoin, as a decentralized method of payment just made this problem go away!
Now Bullion Exchanges are offering an online payment using Bitcoin through a wallet on checkout, giving customers instant access to own physical gold.
Foreign real estate investors, especially from China, have taken the property market to an entirely new level in the United States and Europe. There are two methods offered to property buyers. Either the Bitcoins are sold for fiat currency or, as in many cases; the seller is willing to take Bitcoin as payment.
The decentralized method of crossing borders without attracting scrutiny is taken care of through the blockchain mechanism. Bitcoin can be sold for cash in the USA, thereby eluding all regulatory investigation.
There are many reasons to save money for retirement. Bitcoin has to be the most significant change to the “assets” class of investments in the past decade. However, having all your eggs in one volatile basket may not be the best retirement option. Exchanging Bitcoins for an IRA seems like a good way to go.
A Final Word:
The crypto-currency world is ever evolving, and there will always be pros and cons of buying and selling.
There are always new ways to earn money: it is up to the individual to choose what is right for your bankroll!