May 13, 2024
The rising costs for merchants, staying ahead means not just keeping up with trends but pioneering them. Among the most transformative shifts in e-commerce today is the integration of decentralized finance (DeFi) payments that allow merchants to accept cryptocurrencies as an alternative to credit cards. As merchants strive to expand their reach and streamline their operations, DeFi presents a compelling solution, combining security, cost savings, and innovation.
In this post we'll cover:
What is DeFi?
Why DeFi Payments?
The Rise of Crypto Commerce
How to Integrate DeFi Payments with Helio:
Frequently Asked Questions
What is DeFi?
DeFi refers to decentralized finance leveraging blockchains as opposed to centralized financial services provided by banks or other traditional financial institutions. DeFi cuts out intermediaries and allows sellers to transact directly with buyers in cryptocurrencies like Solana, Bitcoin, Ethereum, and stablecoins such as USDC, USDT, PYUSD (PayPal's digital currency) and EURC, which are pegged to the Dollar or Euro—and it’s quickly gaining in popularity as an alternative to traditional financial services.
Why DeFi Payments?
Global Reach and Inclusivity: Payment platforms like Helio enables merchants to tap into a worldwide customer base, including regions where traditional banking is limited. This is particularly crucial as internet penetration grows, bringing more users online from diverse geographical backgrounds.
Push vs Pull payments: When customers pay for something with a credit card, their information is used to pull the payment from them. Traditional payments are mostly pull payments. By contrast, when a buyer pays for something with crypto, they use a wallet to sign and confirm a transaction to the merchant. This means DeFi payments are push payments leading to increased privacy, reduced risk of chargebacks and fraud, a significant advantage for merchants.
Cost Efficiency: DeFi transactions typically incur lower fees than traditional banking transactions because they bypass a handful of intermediaries such as card networks and banks, who each take a percentage. This not only reduces costs for merchants but also make pricing more competitive for consumers.
Speed and Convenience: DeFi transactions can be completed in seconds or minutes, a vast improvement over the days it can take for traditional bank transfers. Merchants receive settlements instantly rather than waiting for a day or sometimes even weeks for to receive their payouts.
The Rise of Crypto Commerce
The adoption of crypto is not just a trend but a burgeoning sector within the technology industry. According to recent studies, there are more than 100M active crypto wallets, funded with ~$2.5 trillion in wealth. As decentralised wealth grows, users spend with DeFi payments. As a result, merchant crypto payments volume already stood at ~$4B in 2023 and is forecasted to grow rapidly at a CAGR of 75% in the years to come. This growth is also supported by increasing recognition of blockchain's potential to transform financial transactions in terms of speed, cost, and security.
Here is a recent case study from Solana Mobile diving into the sales of their Chapter 2 model with Helio’s Solana Pay. Solana Mobile saved over $1 million on fees by selling through Solana Pay on Shopify and eventually turned off all other traditional payment processors.
How to Integrate DeFi Payments with Helio:
For WooCommerce Merchants:
Set Up: Start by setting up a Helio account to access the dashboard for payment management.
Plugin Installation: Install the Helio Pay plugin directly from the WooCommerce store and activate it.
Configuration: Link your store to Helio by entering your API keys and the Pay Link ID to ensure secure transaction processing.
For Shopify Merchants:
Plugin Installation: Add the Solana Pay plugin from the Shopify app store to begin accepting DeFi payments.
Set Up and Manage: Configure the plugin through the Shopify admin panel, linking it with your Helio and wallet accounts.
For Platforms:
Direct Integration: Integrate the Helio Checkout Widget with a few lines of code into any website or app to accept payments in USDC, USDT, Solana, Ethereum, Bitcoin and 100s of digital currencies.
Frequently Asked Questions
Q: What are the main benefits of using DeFi payments for e-commerce transactions?
A: DeFi offers lower fees (~1% vs. ~3%), enhanced security, faster transactions, and access to a global market. Additionally, Helio provides innovative loyalty tools like NFTs and token-based memberships.
Q: How does DeFi enhance security compared to traditional payment methods?
A: DeFi uses blockchain technology, which records transactions in a tamper-evident ledger, significantly reducing the risk of fraud and eliminating chargebacks.
Q: Are DeFi transactions reversible?
A: No, DeFi transactions are typically irreversible, which prevents fraud through chargebacks.
Q: Can Helio handle multiple types of cryptocurrencies?
A: Yes, platforms like Helio support various cryptocurrencies, providing flexibility for customers to pay with their preferred digital currencies.
Q: How can I set up Helio for my online store?
A: Setting up Helio involves registering for an account, installing the relevant plugin (for WooCommerce or Shopify) or integrating the widget on your website with a few lines of code and configuring your payment settings through the Helio dashboard.
Conclusion
The integration of DeFi payments through platforms like Helio represents a forward-thinking solution for e-commerce merchants looking to enhance their operations and customer experience. As the digital economy grows, embracing DeFi payments not only prepares merchants for future trends but also positions them as leaders in a competitive market. Adopting Helio could well be your next strategic move to future-proof your business in the bustling digital marketplace.
If you're a merchant interested in learning more about DeFi payments?
Contact us at hi@hel.io