Bitcoin has become one of the most popular virtual currencies in today’s time, even for trading goods and services.
As the popularity of cryptocurrency increases, several companies have already started accepting payments in these forms, especially Bitcoin, because of the ease of transfer and wide accessibility.
Most people have started using Bitcoin in their day-to-day transactions only in areas where they are regulated.
However, heavy regulations surround the use of Bitcoin, so people turn to credit card transactions.
Bitcoin and credit card transactions are significantly accepted modes of payment. There are certain differences between the two of them in terms of making easier and better payments.
Let us understand Bitcoin vs credit card transactions.
Bitcoin vs Credit Card Transactions: Key Differences
It is important to use Bitcoin and credit cards in the right way to facilitate transactions. Although they may appear to be similar, they are slightly different. You should know the different payment modes that fit your needs best and align with your personal and professional requirements.
Let’s understand Bitcoin vs credit card transactions to make better investments.
Transaction Fee
When you make a credit card transaction, the company and bank would levy fees on every payment. Therefore, you may end up paying 1.5% to 3.5% extra in certain cases for every transaction that you make. On the other hand, if you use a payment gateway, it will be even more expensive. Thus, these higher fees will eventually be difficult for small and medium-sized businesses, especially for the ones that can be a significant expense.
Bitcoin, on the other hand, proves to be extremely efficient, as it offers lower transaction fees. When you make a transaction via Bitcoin, you will only have to pay the network fee, which will be applicable for that particular transaction. The average network fee for Bitcoin transactions is $1.4, while it ranges from $1-$5. The higher the network congestion, the higher the average network fee will be but it won’t go beyond $5.
Bitcoin Holders: Who Owns the Most Bitcoins?[2024]
Fraud Chargebacks
The risk of fraudulent chargebacks is increasing at a rapid rate. Owing to these chargebacks, you would lose around $3.75 for every $1. This is mostly because of the transactions there will be involvement of higher fees, and chargeback penalties involved in the particular transaction. If there are regular fraudulent chargebacks on your credit card transactions, your account will be at risk of a permanent ban, post which you will be banned from getting a credit card.
Bitcoin transactions are, however, comparatively safer because, after the transactions are confirmed, it can’t be reversed. As a result, if the customer is not satisfied with the particular service or product, they will have to get in touch with the particular party to resolve the concerns. In regards to safety, transactions are far safer in the case of Bitcoins.
Easily Accessible
Even in today’s time, a lot of people do not have access to bank services, such as a credit card, debit card or mortgage. As a result, these people can’t purchase services and goods. The lack of accessibility of credit cards is also one of the major reasons why a lot of people cannot contribute properly to the global economy.
On the other hand, bitcoin is highly accessible. As long as you have Bitcoin in your wallets, you’ll be able to send and receive payments. A lot of Bitcoin users are present in today’s time, and their number is growing significantly too. Moreover, businesses are also accepting Bitcoin because it offers a range of global trade opportunities. Moreover, it has very low transaction fee, thereby offering ease of purchase.
13 Popular Types of Cryptocurrency and How They Work
Ease to Use
Starting to accept credit card transactions can be slightly different. If you want a credit card, you will have to submit all the necessary identity documents, such as proof of identity. Moreover, credit card companies also have significant KYC processes that the customer will have to go through. Only when the KYC process is verified, the transactions will start getting accepted.
Bitcoin transactions are, however, significantly easier. You can just sign up with the platform and get access to these. Some of these payment processors do not need to submit identity proof to accept Bitcoin payments. Most of these merchants also have exclusive rules, such as dynamic QR codes, payment links and more. Therefore, on sharing information, payments will immediately be accepted.
Bitcoin vs Credit Card Transactions: Which One to Use?
Comparatively, bitcoin transactions are one of the main ones to prefer. Not only do Bitcoin transactions offer security, and privacy but also offer full control over funds as compared to credit card companies. There are chances that Bitcoin transactions will become the future of payments. This is the right time to get started and understand Bitcoin vs credit card transactions in order to facilitate easy transactions.
