Markets targeted by this agreement include, Indonesia, Malaysia, Philippines, Thailand, Vietnam and Singapore. Coda Payments has been accepting bitcoin as a payment method in Indonesia and Malaysia.
The latest agreement with Bitx will also help Coda in acquiring more merchants in other countries, as the Singapore-based BitX provides real-time conversion between Bitcoin and local currency, enabling merchants to have the option to accept payments either in local currency or bitcoin. Through the partnership, merchants can file change requests in local currency and receive payments in local currency.
Bitcoin is already available to customers in Indonesia and Malaysia via Codashop, Coda’s in-house online gift card and game voucher distribution platform.
The BitX-Coda partnership will enable Coda to focus on acquiring merchants, as well as further developing integration and settlement aspects of their service.
According to Neil Davidson, CEO of Coda, the low transaction fees and universal accessibility of Bitcoin will position it as an attractor for merchants, relative to the other payment options on the market.
“Given the low penetration of debit and credit cards in the region, we think Bitcoin holds great promise as a way for customers to transact online,” Davidson said.
While certainly a positive development for the local and regional Bitcoin space, it must be remembered that many major businesses, while technically accepting bitcoin, partner with a middleman – Coinbase or BitPay – will accepts a bitcoin transaction and immediately convert it into cash. This cash is subsequently deposited in the company’s bank account.
Bitcoin processing partners who accept bitcoin use business models relying on transaction fees, as in the case of Coinbase. Alternatively, they sell their software and services as a subscription, as in the case of BitPay.
BitPay – which has partnered with Microsoft – has confirmed that the majority of major clients seek to instantly convert their bitcoins to cash. In a statement to TIME, Tony Gallippi, co-founder and executive chairman of BitPay, said, “I would say as a general trend most of our larger business do choose a settlement in 100 per cent US dollars because that’s how they do their accounting and finance.”
In essence, are mainstream businesses ready to accept Bitcoin as a payment option? Most businesspeople and entrepreneurs will prefer fiat currencies over bitcoin.
Due to the tremendous volatility of the past, merchants tend to be dis-incentivised in accepting bitcoin as a store of value. As a merchant and/or user, most users will desire to exchange their digital currency for a fiat currency that tends towards more stability (e.g. Singapore Dollar).
The contrary view states that the value of bitcoin lies in the underlying blockchain technology, which unifies anonymity; a guarantee of trustworthiness; convenience and scalability of digital transfer; and a store of value into a single financial asset. But should businesses accept bitcoin?
Bitcoin presents strong opportunities to mainstream businesses but raises questions of acceptance. It is a better way to do transactions, primarily from a payments perspective. But gaining mainstream use requires far more stability and maturity of the ecosystem as a whole before it merchants are open to adopting it as a payment option.
With firms like Symbiont offering ‘smart securities‘ and Deloitte, one of the Big Four auditing firms, exploring the possibilities offered by blockchain technologies for client auditing through the formation of the Deloitte Cryptocurrency Community (DCC), the melded bitcoin & cryptocurrency space is a domain that is in flux and bound to see further changes.