on the crypto
Despite the boom in e-commerce during COVID-19, bitcoin does not impose itself in retail transactions.
The trend of crypto payments has not yet taken off
Although the e-commerce sector has been booming since the start of the Great Lockdown, crypto payments remain extremely niche. “In the past three months, we have seen about half a million dollars [spent] in bitcoin, bitcoin cash and litecoin.
Most of it is definitely bitcoin, ”said Brian Hoffman, co-founder of OB1, maker of the crypto app Haven and its desktop counterpart, OpenBazaar. His startup earns money through affiliate marketing.
The figure reported by OB1 is really low when compared to markets like Shopify, which posted revenues of $ 470 million in the first quarter of 2020, an increase of 47% over the previous quarter. Even if we take into consideration the smaller scale of OB1, the modest growth of the crypto startup does not seem to reflect the wider trend of e-commerce.
Slow growth
Since the software underlying the app is more decentralized than in markets such as Amazon, OB1 cannot partner with all merchants. (This is a feature, not a bug, considering how Etsy commissions, for example, are incumbent on small traders.
Regardless, Etsy's usage has increased and the company's share price has tripled in the past three months.) Overall, bitcoin usage has continued to grow at a modest rate over the past year.
According to a BitPay spokesman, a payment manager, volumes increased by 10% in the first quarter of 2020 compared to the fourth quarter of 2019, mainly for IT products and services. "We saw a recovery when eBay and Amazon blocked sellers of bezels and other devices," said Hoffman of OB1. "We now have new Chinese vendors trying to sell this [medical] equipment."
We continue to experiment in the e-commerce sector
Among small businesses, risky merchants are the primary sector where bitcoin is slowly gaining traction. However, licensing is a slow and expensive process. It takes months to conform your strategy and offer the services you want.
In the meantime, Facebook is doubling the purchase functionality, potentially thanks to the renewed crypto affiliate, Novi. OB1's Hoffman said that starting in 2020, the bitcoin trade will offer an "alternative" to markets like Etsy, especially for small traders.
But the commercial sector of the bitcoin economy is not growing at the same rate as the main competitors offering corporate brands, even based on the smaller scale. "We are making tons of sales using OpenBazaar," Hoffman said of the OB1 sale of protective masks and appliances. "But if [buyers] want an iPhone, we're not there yet."
The performance of the Amazon shares (AMZN) listed on NASDAQ for the last month is + 8,72%, for the last six months it is + 51,08% according to market data.
