The power and promise of technology has extended across the globe and touched every industry in some way, from oil and gas to transportation. It has made the decentralization of the internet possible and has completely changed the way we bank, finance and shop. The biggest challenge of all for the industry is cryptocurrencies. Specifically, the creation of cryptocurrencies.
What is Cryptocurrency?
Cryptocurrency is a form of payment – a digital currency – that can be exchanged online for goods and services. One of the biggest advantages of this currency, that continues to attract consumers and companies alike, is that it is secured by cryptography; this makes it nearly impossible to counterfeit or double-spend. Many companies today have issued their own currencies, often called tokens, which can be traded specifically for products/services the company offers.
Cryptocurrencies are powered by a technology called blockchain. This decentralized technology is spread out across many computers. These computers then manage and record transactions. Recently, a new challenge has been highlighted related to the creation of cryptocurrencies: these supercomputers that generate coins through cryptocurrency need a lot of energy.
Does the Industry Need to “Go Green”?
According to data from an expert panel put together by DealBook, the process of creating Bitcoin – one of the top cryptocurrencies – requires around 91 terawatt hours of electricity per year. That’s more than the energy a country like Finland consumes in that same timeframe (with approximately 5.5 million people.)
The “proof of work” process is a massive part of the energy used to generate digital tokens. It is the process used to verify new transactions, add them to the blockchain and create new tokens. Now, experts are calling for cryptocurrency and its process to be regulated due to the environmental cost of generating cryptocurrencies.
Thus far, two options have been proposed: (1) greater transparency about carbon costs, as it pertains to a cryptocurrency business, and (2) the implementation of some form of carbon tax. The environmental justice organizations have recently urged the inclusion of the energy use of cryptocurrencies in the new rules for the sector.
What Merchants Need to Know
Is your business interested in offering cryptocurrency payments? Are you searching for a means of adding it to your list of payment processing options? Especially today, customers prefer and have grown to expect convenience and options at checkout. Adding cryptocurrency to your list of options is a matter of future growth, ensuring you don’t miss a sale simply because you do not have the ability to accept them.
The key is to make sure you partner with a provider that understands your business type and industry. You also want a processor with experience in providing the latest tools and that keeps up with the latest trends and payment options. This will ensure you have industry leading support and safety you need to be successful.
Author Bio:- Content crafter Alex Wilmont has been active in the payments industry for over 15 years. He lives simply, gives generously and loves his 2 dogs. His mission is to enhance and innovate the fintech industry for years to come.