Highlights of Guide to Secured Crypto Payment:

• Embrace the Cryptocurrency Trend: There are over 420 million cryptocurrency holders worldwide, making cryptocurrency payments mainstream. Insider Intelligence predicts that the US cryptocurrency payment market will grow by 21.3% in the coming years.
• Advantages of Cryptocurrency Payments: Cryptocurrency payments are fast, low-cost, secure, and universally accepted, increasingly favored by merchants and consumers. Traditional financial giants like PayPal and Visa are also actively entering this field.
• Risks of Cryptocurrency Payments: The risks brought by cryptocurrency payments cannot be overlooked, including price volatility, security vulnerabilities, and regulatory compliance issues. Risk management needs to be considered.
• Response Strategy: Choosing a reliable cryptocurrency payment service provider, using non-custodial wallets, and carefully preventing human errors are key to reducing risks.
• Advantages of Gate Pay: Gate Pay offers multiple payment options, low-cost, a safe and reliable trading environment, and comprehensive technical support. It is an ideal choice for businesses and individuals.

Entering 2024, it is estimated that nearly 420 million people worldwide own cryptocurrencies, such as Bitcoin, Ethereum, and USDT, making the trend of cryptocurrency impossible to ignore. According to data from Insider Intelligence, the US cryptocurrency payment scene is expected to surge by 21.3% from 2022 to 2025, implying that merchants and users will increasingly use cryptocurrency for transactions in the future.

Cryptocurrency offers advantages like speed, low cost, security, and global acceptance, leading to increasing adoption from merchants and users as a form of payment. Traditional payment companies such as PayPal and Visa are increasingly accepting cryptocurrency, and have announced their entry into the cryptocurrency payment market.

However, if cryptocurrency wants to reach new heights, the security of its payment system is crucial. On one hand, it needs to ensure that buyers and sellers can smoothly use and receive cryptocurrency, on the other hand, it needs to prevent hacker invasions that could result in financial loss. This article will introduce how to use cryptocurrency payments safely, ensuring that your transaction risk is minimized.

Number of Daily Transactions of Bitcoin from January 2009 to April 11, 2024.

Image Source: Statista

Benefits of Using Cryptocurrency Payments

According to Insider Intelligence data, as more and more companies accept cryptocurrency as a payment method, the global transaction volume of cryptocurrency reached 16.16 billion dollars in 2023, a nearly 800% growth compared to 2.2 billion dollars in 2020. Cryptocurrency is stepping out of the shadows, becoming a strong competitor to traditional financial systems and fiat currencies. Some investors even see Bitcoin as an alternative to gold, attracting the attention of numerous institutional investors, global payment systems, and major participants in the financial market.

In today’s fierce business competition, adopting cryptocurrency payments has become a breakthrough move. Compared to traditional financial institutions, cryptocurrency payments have significant advantages for both merchants and consumers:

Fast Transactions

Suppose a merchant urgently needs to purchase a batch of goods, but a bank transfer may take several days to reach the account. In contrast, using cryptocurrency payments can achieve instant transfers. Transactions can be completed within a few seconds, allowing you to immediately get the funds you need without the delay problem of traditional financial systems.

Low Transaction Fees

Taking traditional international remittances as an example, not only is the transfer speed slow, but high handling fees are also required. In contrast, using cryptocurrency payments, merchants and consumers will save a lot of costs and do not have to worry about exchange rate fluctuations. For example, Gate Pay, a cryptocurrency payment solution based on blockchain technology developed by Gate.io, does not charge any fees as there are no intermediary agencies. You don’t need to purchase specific card swiping machines or scanning equipment, just download the Gate.io mobile app to use, greatly reducing the maintenance costs and intermediary fees for merchants.

Enhanced Security

Compared to traditional credit card payments, cryptocurrency transactions use advanced blockchain technology to provide a higher level of security. Consumers do not have to worry about the risk of credit card information being swiped or identity theft. For instance, Bitcoin transactions are stored on each node of the decentralized network in the blockchain, not centrally stored on a single central server. This means that even if a node is attacked or faulty, other nodes can still maintain the integrity of the entire transaction record.

Globally Accepted

Cryptocurrency is not restricted by geographical location or currency. This means that consumers can easily transact with merchants all over the world, and both parties do not have to worry about the complexity and cost of currency exchange or cross-border payments.

Potential Risks of Cryptocurrency Payment

Despite the many advantages of cryptocurrency payments, businesses and users must be aware of the potential risks associated with accepting cryptocurrencies. Here are the main risks to consider:

Price Volatility

The cryptocurrency market is extremely volatile, with prices capable of significant fluctuations in a short period of time. For instance, earlier this year, Bitcoin’s value surged by 45.69% within a single month, not to mention the volatility of other cryptocurrencies. Therefore, engaging in cryptocurrency transactions might pose the risk of rapid value depreciation, leading to losses. Consequently, stablecoins like USDT and USDC, which are pegged to the US dollar, can prove to be useful.

Image Source: CoinDesk

Security Vulnerabilities

Although blockchain technology is relatively secure, cryptocurrency trading platforms and cryptocurrency wallets may potentially have security vulnerabilities, making them susceptible to hacker attacks. Users’ cryptocurrencies could be stolen or manipulated. For example, in June 2023, the Atomic wallet was attacked by hackers, resulting in a loss of over $100 million in cryptocurrency, affecting a minimum of 5,500 cryptocurrency addresses.

Not sure how to choose a suitable wallet? Common types of cryptocurrency wallets include:

• Cold wallets
• Hot wallets
• Custodial wallets
• Non-custodial wallets
• Multi-signature wallets

Each wallet has its own pros and cons. When choosing a wallet, please consider your own situation, or refer to this article: “Bitcoin Wallets - Which, what, why?“

Regulatory and Compliance Risks

Merchants accepting cryptocurrency payments may have to contend with regulatory frameworks, anti-money laundering (AML) regulations, Know Your Customer (KYC) obligations, and other legal considerations. These can increase transaction costs as suspicious illegal activities need to be monitored.

Image Source: Chainalysis

How to Mitigate Risks in Cryptocurrency Payments?

Approximately 15,000 businesses worldwide, including 2,300 in the United States, such as PayPal, Shopify, and Expedia, have already begun to accept cryptocurrency payments. Therefore, understanding the risks associated with cryptocurrency payments is crucial:

Choose a Reliable Cryptocurrency Payment Service

Choosing a reputable and reliable cryptocurrency payment technology provider is crucial to ensure that merchants and users can pay and receive cryptocurrencies anytime and anywhere. Gate Pay is a non-contact, cross-border, secure, free, and fast cryptocurrency payment technology developed by Gate.io. Users only need to register a Gate.io platform account to use the Gate Pay product, which can offer a range of services from third-party merchant partner platforms including online shopping, flight and hotel bookings, leisure and entertainment, and eliminates the cumbersome steps of fiat currency exchange.

The main difference between Gate Pay and traditional electronic payments is that Gate Pay is a cryptocurrency payment product based on blockchain technology. By providing a series of basic construction frameworks, it helps merchants directly connect their business back-end with the blockchain network, with blockchain miners or verification node points handling the flow of funds and clearing business.

Similar to Bitcoin, Gate Pay’s transaction records are stored across different nodes in a decentralized blockchain network, rather than on a single central server. This means even if a node is attacked or fails, other nodes in Gate Pay’s network can still maintain the complete record of transactions, ensuring transaction stability and reducing the risk of hack attacks.

Consider Using a Non-custodial Wallet

In a custodial wallet, the private key is managed and stored by a third party, usually an exchange or service provider. This means that users do not need to worry about managing their private keys, but there is a risk of being attacked by hackers or the platform shutting down. In a non-custodial wallet, the private key is managed and stored by the users themselves, giving users a higher level of security and control, but they also need to take responsibility for keeping the private key safe from loss or theft. Using a non-custodial wallet allows you to control your funds and private keys. No company or bank can access them, reducing the risk of hacker attacks and theft, but remember to keep your private key safe.

Reduce the Risk of Human Error

When sending or receiving cryptocurrency, be careful and cautious. Please check all transaction details carefully to avoid any mistakes that could lead to losses. Also, be aware of fraudulent emails or malware and avoid using public Wi-Fi networks for transactions to ensure safety.

Advantages of Gate Pay

Gate Pay currently offers two convenient payment functions: QR code payment and address payment, allowing consumers to easily enjoy the convenience of cryptocurrency payments. From daily shopping to cross-border payments, to online shopping, Gate Pay meets all your payment needs. For business users, Gate Pay provides a low-cost, fast-integration one-stop cryptocurrency payment solution, allowing you to easily accept cryptocurrency from global customers without worrying about geographic and time constraints.

1. Provides Multiple Cryptocurrency Payment Options
   Gate Pay provides over 20 cryptocurrency payment options, including the most commonly used Bitcoin, Ethereum, and USDT. Gate Pay plans to increase the cryptocurrency payment options to more than 130 in the future.

2. Low Cost
   Gate Pay does not charge any fees and does not require the purchase of specific card machines or scanning devices. Just download the Gate.io mobile app to use, greatly reducing the maintenance costs and intermediate fees for businesses.

3. Secure and Reliable
   Unlike other payment platforms, Gate Pay’s transaction records are stored on different nodes in the blockchain distributed network, not on a single central server. This means that even if a node is attacked or fails, other nodes of Gate Pay can still maintain the integrity of the entire transaction record, ensuring transaction stability and reducing the risk of hacker intrusion.

4. Technical Support
   Businesses can create business applications in Gate Pay’s MiniApp to reach millions of active users holding cryptocurrencies on the Gate.io platform, increasing exposure. If there are no developers in your team, Gate Pay provides a no-code solution to help you create a mini-program in MiniApp to achieve results, and there is no need to pay regular maintenance fees. If you want to access Gate Pay’s payment services, please fill out the merchant registration form and contact us at gatepay@gate.io.

For more information about Gate Pay, you can read this article: What is Gate Pay？