Bitcoin: The Next ‘Must-Have’
In early 2015, when I started to focus on bringing Coinsnap’s Bitcoin payment solutions to the adult industry, following successful experiences in similar markets, I had to do a lot of explaining.
Most people in the adult world that I talked to — despite being online professionals with substantial experience in alternative online payment methods — didn’t care much about Bitcoin. To them, Bitcoin was just an obscure cryptocurrency, used mainly by nerds or in the “dark web” — rather than a simple, easy-to-implement payment option that might actually help them tap into a completely new, fast-growing consumer base with enough potential to be worth the effort.
And they were not entirely wrong, in fact, given that most Bitcoin owners back then could still be classified as either investors (people who held Bitcoins in the hope of cashing in on value fluctuations) or miners (the guys who actually create Bitcoins in their “basements” or data centers). The prevailing opinion in the adult industry was that these people wouldn’t want to pay for porn anyway, due to the “I-can-already-download-whatever-I-want-to-see-for-free” attitude that was rampant among them.
There were a handful of true innovators who offered Bitcoin payment on their adult membership, dating, or cam sites simply because they would adopt whatever innovations presented themselves — but the common belief, even just a year ago, was that there wasn’t enough money to be made with Bitcoin to really pay much attention to it. Most adult site managers clearly doubted my assertion that there was indeed a market for purchasing adult content and services with Bitcoin.
Most of my efforts went into explaining basic concepts such as “what exactly are Bitcoins and Bitcoin wallets? “How do people actually pay with them?” or “how can merchants can get their Bitcoin sales revenues accounted for in ‘real’ currencies, without losses due to the constant fluctuations in the ‘value’ of Bitcoin?” In the first half of 2015, marketing Bitcoin payment solutions to the adult industry was still grueling, tedious work.
Fortunately, this situation didn’t last for long. Through the grapevine, word spread that early adopters like Porn.com made up to 10 percent of their sales via Bitcoin. Bitcoin blogs and “conventional” financial media were reporting almost daily about major new enterprises and retailers all over the world who had decided to accept Bitcoin payments.
In July 2015, it was reported that more than 10 million Bitcoin wallets were already being used to make over 100,000 Bitcoin payments on any given day. Adult industry publications published examples of profitable Bitcoin implementations, aside from membership sites.
As a result, I already noticed a significant shift in the kind of questions I was being asked at the European Summit in Prague in September 2015 — not only were people generally very aware of the fact that a 10 percent increase in sales could realistically be generated through Bitcoin payments, they also wanted to know more precisely about how they could take advantage of Bitcoin to grow their own businesses. It was also obvious that the Bitcoin discussion had reached new niches in the industry — it was especially those who handle high volumes of payments or payouts, such as cam-site operators, affiliate programs, and traffic networks, who were looking into Bitcoin as an interesting alternative payment solution.
The first industry gatherings of 2016 have confirmed my conviction that Bitcoin is gaining industry-wide momentum. At the European Summit in Sitges, as well as at Internext in Las Vegas, most of the adult industry leaders with whom I spoke confirmed that they will be implementing Bitcoin payment sooner rather than later. Additionally, more and more adult businesses are currently jumping onto the Bitcoin bandwagon, besides the traditional download and membership sites (which admittedly have issues with not being able to handle recurring payments in Bitcoin.) A typical example is European cam-site operator Visit-X, which recently signed up for Coinsnap’s Bitcoin payment solution. Cam-site operators are interested in using Bitcoin payment not only to cater to their many potential customers who insist upon anonymity when using cam services, but also because they see great potential to streamline the process of making payouts to their cam girls, who are often from countries with limited banking infrastructure. The same goes for traffic networks (both advertisers and publishers) and affiliate system providers who, in addition to facing similar issues, also have to deal with a lot of micropayments to satisfy their large numbers of global business partners.
In less than 15 months, Bitcoin payment solutions have made the leap from “not relevant” to “nice to have” — and acceptance of Bitcoin as a payment method is undoubtedly maturing into an industry-wide reality. So, now the question is: What’s in store for Bitcoin over the next 18 months?
The latest surveys forecast an increase in market share for Bitcoin of up to 20 percent of all sales by 2017. Additionally, many other businesses in the adult industry ecosystem, such as mission-critical affiliate programs and traffic networks, will implement Bitcoin payment as well — not to sell content or services to end users, but rather to optimize their processes and cut costs related to paying for traffic, ads, affiliates, etc. The increasing availability of Bitcoin offerings will also motivate scores of new consumers to try out Bitcoin payments for their purchases.
Based on these developments, I can confidently predict that, by 2017, Bitcoin payments will be a “must have” for all businesses in the adult industry that want to a) participate in future market growth, b) stay ahead of their competition, and c) make their products available to the increasing number of consumers all over the world who lack access to other alternative payment methods.
So, to make a long story short: Why will Bitcoin payment processing be a “must have” in 2017? Well, because …
Bitcoin payment solutions allow you to optimize your sales processes, thanks to easy implementation via an API, instant availability of your revenues in your account, complete elimination of chargeback risks, cheap transaction costs, etc.
Bitcoin sales revenues can be paid out instantly in the fiat currency of your choice — you receive your sales revenues at book value, no matter what.
Bitcoin can help you optimize underlying business processes, such as payouts, micropayments, and payments to business partners.
There simply is no considerable financial or technical risk in adding Bitcoin payment to your suite of alternative payment methods — but there’s a lot to lose if you don’t!
The earlier you start working with Bitcoin, the more experience you will have when this market goes mainstream — and the bigger your share will be of this emerging market!
Coinsnap.eu CEO Stephan Wetzmueller has been part of the payment industry for more than 10 years. After starting his career at Paysafecard in Germany, he worked for several payment providers before starting his own businesses in 2006. Providing processing options for the entertainment industry and being able to offer tailor-made solutions for merchants has been his passion. He is now breaking new grounds by providing the most innovative payment option, Bitcoin, to the adult industry.