Apart from Forex Online Market Can virtual currency be used for payment: Can virtual currency in Forex Online Market be used to settle shopping?” “I don’t know the difference between virtual currency and electronic money. Which is better?”
Cashless payments are becoming widespread and payment methods other than cash are becoming common, but I think that few people know that virtual currencies such as Bitcoin can also be used for payments.
Also, not many people can clearly explain the difference between electronic money and virtual currency.
In this blog, we will introduce the payment method with virtual currency, the difference between virtual currency and electronic money, advantages and disadvantages.
Can virtual currency be used to settle shopping?
Currently, some virtual currencies can be used in the same way as electronic money as a payment method for shopping.
Although it is not available in many places, it was introduced in 2018 by Bic Camera, a major electric mass retailer, and can also be used by Kojima and Sofmap.
Of course, there are scenes where it can be used not only at home electronics mass retailers but also at restaurants, gyms, and mail-order sites, and the number of stores that can handle it is increasing day by day.
What is a virtual currency in Forex Online Market?
Cryptocurrencies are encrypted digital assets, also known as crypto-assets. Unlike the INR and the US dollar, there is no national issuer.
Since it is electronic data, it does not exist, but it is a currency in which payments can be made in the same way as the INR. You can purchase using INR or dollars, and vice versa.
One of the features of virtual currency is that it manages transaction history and creates a database using a technology called a blockchain.
Blockchain is not a centralized data management technology, but a technology in which users on the Internet cooperate to manage data.
Legal tenders such as the INR and the US dollar can be said to be centralized currencies because they are centrally managed under the state and government.
What are the cryptocurrency brands that can be used for payment?
Various brands of virtual currencies are traded day and night. Among them, Bitcoin (BTC), Ethereum (ETH), and Ripple (XRP) are typical virtual currencies that can be used for payment.
The available cryptocurrencies vary depending on the cryptocurrency exchange that opens the account.
It’s not the same everywhere, so you have to choose the exchange that suits the cryptocurrency you are interested in.
Below are the virtual currencies that can be used for each of the four typical exchanges.
Introducing how to use virtual currency for payment
Payment is made using a virtual currency wallet called a “wallet”. This wallet can be obtained by opening an account on a cryptocurrency exchange and downloading a dedicated app.
Then, payment is made by holding the smartphone with the wallet installed over the store’s two-dimensional code.
Cryptocurrencies can be used not only for payment but also for remittance between individuals.
You can send money by entering the virtual currency address of the other party or by scanning the two-dimensional code of the wallet displayed on the other party.
What is the difference between virtual currency and electronic money?
Electronic money has an image similar to virtual currency. In both cases, there is no change in using dedicated coins (money) for payment. The big difference is that electronic money uses legal tender.
Electronic money such as transportation IC cards and Osaifu-Keitai can be used by charging a certain amount of INR, which is the legal currency.
Cryptocurrencies, on the other hand, use coins in wallets or dedicated apps directly.
1. Different publishers
The issuer is different between virtual currency and electronic money.
Electronic money: Issued by companies and transportation.
Virtual currency: Issued by mining
Corresponding law is different
The corresponding laws differ between virtual currency and electronic money.
Electronic money: Since legal tender is used, the “fund settlement method” is applied.
Cryptocurrency: The “Cryptocurrency Law” established for virtual currencies, not legal tender, is applied.
Available locations are different
The places where you can use virtual currency and electronic money are different.
- Electronic money: Can be used at member stores.
- Virtual currency: This can be used at stores that have introduced virtual currency payment such as Bitcoin payment.
4. Price fluctuations
There is a difference between virtual currency and electronic money with or without price fluctuations.
- Electronic money: It depends on the INR, and price fluctuations are small.
- Cryptocurrency: Price fluctuations are large, and the value of the same currency changes depending on the timing of use.
5. How to purchase
There are differences in purchasing methods between virtual currency and electronic money.
- Electronic money: Charge using cash or credit card.
- Cryptocurrency: Purchase using INR at the cryptocurrency exchange.
Precautions when using virtual currency for payment
There are four points to keep in mind when purchasing virtual currency for use in payments. Make sure you understand that you may lose money in unexpected places.
1. Rate fluctuation risk
There is a risk of price fluctuations in virtual currencies. Unlike electronic money, the price fluctuates daily, so payment is made at the market price at the time of use.
For example, suppose you buy 1 BTC for 6,000,000 INR. Due to the large price fluctuations of virtual currencies, the price may rise to 6,500,000 INR the next day, or conversely, it may fall to 5,000,000 INR.
At present, the fluctuation of virtual currencies is large, so many people are worried that they will lose money, which is one of the factors that hinder the spread of payments in virtual currencies.
2. It takes time to settle
Payment (remittance) may take some time for some virtual currencies. For example, Bitcoin takes 10 minutes.
Bitcoin is processed using blockchain and when technology and verification work is performed using an algorithm called Proof of Work.
The bitcoin blockchain can approve one block every 10 minutes, and the number that can be processed at the same time is small, so the larger the number of processing, the longer it will take.
Some types of virtual currencies are faster than Bitcoin. In addition, depending on the payment method, there is also a service that purchases a deposit using virtual currency in advance and makes a payment with it.
3. It takes time to prepare
To pay with virtual currency, it is necessary to prepare by following the procedure introduced in “Introduction of how to use virtual currency for payment”.
If you normally manage Bitcoin, you can use it just by preparing an application provided by a virtual currency exchange company.
However, it takes time for those who are thinking of starting from now on. It is expected that virtual currencies will become more widespread and convenience will be improved in the future.
4. Taxes apply
When virtual currency is used for settlement, the profit will be taxed in the same way as when it is redeemed.
If you make a profit, you will be taxed, and if you lose it, you will not be compensated.
This is another reason why the use of payments is not widespread, as it is necessary to record all transactions and file tax returns.
More convenient to use virtual currency for payment
Cryptocurrency payments are not yet fully developed and there are certainly some aspects that are difficult to use. In addition, the number of stores that can be used is small.
However, now that cashless payments are widespread, it seems that it is only a matter of time before payments using virtual currencies become widespread.
In the United States, cryptocurrency payments are already available at fast food stores, etc., and major credit card companies have announced that they will also enter cryptocurrencies.
Even in India, the number of places that can be used, such as major home electronics mass retailers, is increasing day by day.
Try to settle with virtual currency
In the future, payments using virtual currencies will become one of the representatives of cashless payments as well as credit cards and electronic money.
It is expected that the value of the virtual currency will increase as the demand increases as the convenience increases.
If you are not using virtual currency on this occasion, why not try using virtual currency? Also, if you are already using it, why not try payment using virtual currency?
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