Bitcoin’s reputation needs a makeover. Russell Moore, Director of Innovation at TSYS, sat down with PYMNTS to offer new thinking on the dark reputation that’s attached itself to the bitcoin name.
Russell Moore, Director of Innovation at TSYS, agrees that it’s been misused in a myriad of ways, but feels that bitcoin and other cryptocurrencies offer merchants the chance to view payment processing in a new way. He gives PYMNTS a different take on the use of cryptocurrencies in payments.
PYMNTS: What is the biggest misconception about bitcoin and digital currencies in terms of the payments processing perspective?
RM: That bitcoin is a dark currency that it is only used for elicit purchases. Thousands of merchants accept bitcoin payments every day for ordinary purchases such as a monthly satellite TV subscription or home goods. There is also a misconception that bitcoin is too volatile to accept as a form of payment when, in reality, price volatility is easy to avoid.
PYMNTS: What should merchants that are considering accepting bitcoin/cryptocurrencies know about the potential benefits?
RM: As the world's first borderless payment network, bitcoin allows merchants to receive payment in any amount, from anywhere in the world, from any computer or mobile device. The user base for bitcoin is growing steadily and is a loyal group that is drawn to businesses that accept bitcoin as a payment method. Accepting bitcoin can be less expensive for the merchant than other forms of payment, with the added benefit of reducing chargeback risks and identity fraud.
PYMNTS: How can merchants safeguard themselves from any potential risk that may be associated with accepting bitcoin/cryptocurrencies?
RM: Accepting bitcoin through a payment processor eliminates the volatility risk of bitcoin's fluctuating price relative to the dollar. Merchants can receive the dollar equivalent while still enjoying the benefits of the bitcoin payment network.
PYMNTS: What are the best solutions in market that merchants can use in order to accept bitcoin payments?
RM: Merchants have a bevy of options. BitPay, Coinbase and Coinify are trusted bitcoin payment processors that have services for online and in-person payments.
PYMNTS: How is TSYS examining the use of bitcoin/cryptocurrency in the payments processing ecosystem?
RM: TSYS is closely following blockchain developments and exploring the technology and its potential. TSYS sits on the advisory board for the world’s leading blockchain information product, The Distributed Ledger. In its board role, TSYS has a first look at innovative enterprise-level blockchain applications and the companies building them. We also maintain an active dialogue with our client base on the role that blockchain and cryptocurrencies could play in the payments industry.
PYMNTS: Does bitcoin/cryptocurrencies have the ability to innovate how payments are transacted/processed?
RM: Yes, the potential for a blockchain decentralized cryptocurrency is there. At a high level, bitcoin introduces a borderless and near-instant payment network. The technology behind bitcoin also introduces the capability for micro-transactions and payments based on smart contracts. We are looking at ways to leverage both, or to see what role it has in the current ecosystem or in the future of payments.
PYMNTS: Because of the fluctuating price of bitcoin, how can merchants ensure the bitcoin/cryptocurrency payments they accept are protected and processed at the accurate value?
RM: Trusted bitcoin payment processors like BitPay fix the flat amount to be paid to the merchant during any bitcoin purchase at the exact market rate at the time of purchase.