Looking for advice on using blockchain to collect payments and send money around the world, to lower my fees and stop making banks rich.


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My adventure travel business (http://sacredrides.com) collects payments from customers all over the world, and I also have to send money (usually in large sums like $25-$40K) all over the world to my ground staff to deliver trips.

I pay ~2.4% when collecting payments (via Stripe), and then I also pay forex fees when I’m sending money all over the world, usually in USD, or EUR. I have some great developers who can build just about anything I ask them to, but I’m wondering where/how to get started using blockchain technology to avoid making banks rich (we collect about $2M in payments every year, and then distribute over $1M around the world – that’s a lot of fees!).

Any help would be appreciated!


    Im assuming the business objective is to reduce fees and the payment rails is secondary, even if it happens to be open loop.
    Your cheapest option to reduce fees is transacting in cryptocurrency at both sending and receiving end. You can either use an existing service or have your development team setup the QR code based bitcoin payment options on your merchant site.
    However this will vastly reduce your customer base so Im assuming at the very least you want to give the sender the flexibility to send in fiat currency. This is where the options drastically reduce. If you decide to use the blockchain you need to convert the currency to cryptocurrency to transfer value, the issue is less technical and more about having a sophisticated hedging strategy from various fiat currencies to the cryptocurrency of your choice. Few such providers that perform hedging at both ends that I know of are Circle, Abra and Ripple. However Circle and Ripple do not offer merchant services and Abra is offering merchant services only in Philippines. Circle and Abra are closed loop while Ripple is open loop and works only with banks.
    If using the blockchain is secondary and you are primarily focused on reducing fees I would recommend Transferwise.
    Hi @jeevak, thanks for the reply. My overall goal is to reduce the amount of money I’m sending to my banks, while giving customers additional options for payment. So on the customer side I won’t be getting rid of Paypal or credit card payment options any time soon, but if I can accept payment in bitcoin for those customers that use it, then I can see that being useful. I’m just not sure how we would do that. Our booking system is built from scratch, so my developers just built integrations to Stripe and Paypal into it. I’m assuming they can do the same with bitcoin, but I need to give them some direction. Any ideas?

    On the transfer side (transferring funds to my suppliers), it wouldn’t be too hard to convince them to get set up with cryptocurrency as they can see the value of not having to pay fees.

    There are a bunch of technology providers that offer bitcoin merchant services. Here is a link for a comprehensive list: https://en.bitcoin.it/wiki/How_to_accept_Bitcoin,_for_small_businesses#Merchant_Services
    Couple of popular ones in the bay area are BitPay and Coinbase. I havent really performed any price comparisons so you might need to look into it. Since you are already engaged with PayPal you should checkout braintree, they offer the standard checkout options as well as accept bitcoin payments through their integration with Coinbase. It may make more sense to stick to one gateway provider instead of maintaining multiple relationships.
    Would love to hear back what you learnt from your evaluation experience and the final integrations.
    @mike First of all – Do not even think of utilizing your developers to create something in this space. Getting Govt approval for opening up a cryptocurrency exchange is pain in the a## . Dont reinvent the wheel as there is decent infrastructure in each and every country and just utilize it.
    I will talk about the legal and ethical way only here.

    Use Bitcoin (BTC) as the medium of exchange.

    Each country has registered BTC exchanges which comply with whatever existing laws. Eg: In Canada and USA it is Kraken, coinbase, anxpro etc . In India –> Unocoin etc.

    Each involved party needs to have BTC Address. That is as simple as registering online at the exchange in that country, upload identity documents to comply with AML / KYC etc. Once registered, the online exchange will generate a BTC Address. You can ‘buy’ BTC with the local currency. Once every person has a BTC Address then using the features of the online exchange itself or transferring through a Bitcoin wallet you can seamlessly transfer BTC without any friction. The transaction fee is less than a dollar

    Hope this helps. Let me know…

    Edited on December 16, 2016
    Hi @kiranvaidya I definitely did not have building a cryptocurrency exchange in mind. I just meant that for our booking system to be able to collect payments using cryptocurrency (e.g. Bitcoin), they would need to build out some sort of integration. So our trips could be priced in the current fiat currency, but also in BItcoin, and our customers would have the option to pay in Bitcoin. Then if I get my suppliers to set up a Bitcoin account, I can take Bitcoin that I have collected from customers, and use it to send Bitcoin to my suppliers, avoiding a lot of fees in the process. Do you know of a Bitcoin e-commerce solution I can integrate into my booking process? (i.e. the same way that they integrated Stripe payments into my booking process?)
    @jeevak @mikebrcic Apologize on misunderstanding .. i was in meeting in office and secretly reading blockgeeks in my browser window 🙂 🙂 .. and still dont know why , but i thought u want some btc to fiat payment exchange to be setup and u will utilize ur developers…

    Anyways.. in my opinion there is no single global solution. The reason is the Fiat to BTC has different KYC/AML laws in each nation.. What you can do is setup payment page for each country.. so if your customer wants to pay in BTC and is resident of India then navigate to page where you have integration with registered Indian BTC eCommerce solution.. In India it is https://www.unocoin.com/merchants/overview

    For USA and Canada use https://developers.coinbase.com/docs/merchants/
    etc..

    so design payment page for each country and integrate with the BTC ecommerce solution (API) provider for that country.. Hope this helps..

    Probably you consider the transaction costs in your price.

    And if you give some discount or benefits for customers that pay in BTC?

    You don’t need intermediaries or pay fees to exchange fiat to btc.

    Could be a very simplistic solution, but at same time could be effective.

    Yes, that would be ideal. Do you have any suggestions for how to achieve this solution?
    In a simple way: say to your ground staff that you’re planning pay them in BTC. If they accept the deal, you divide with them the fee you will not pay. If they don’t accept, you pay the value minus the fee you must pay to the bank.

    The same when you receive from your clients. If they pay in BTC you give them a discount.

    To do this they (clients and staffs) only need to have a Bitcoin address, and have an exchange on their countries if they want to convert to fiat money.

    Obviously you can develop a more sophisticated system in your web site to convert BTC to Fiat and vice-versa, verify if the transfer was confirmed n times, etc.

    But behind the scenes it will be a simple transfer of Bitcoins

    @mikebrcic We (Everex.one) already have technology to solve this problem, and now building a business around it. Travel industry, classified as high-risk by payment processing providers, is one of the best application for CryptoCash (fiat money on blockchain). We only plan to charge merchants 0.5% and it comes with no-chargebacks option and up to 30sec settlement with no geographical limitations.
    I know and use Transferwise which is much better than banks. the problem with crypto coins would be getting potential customers to sign up and present identities documentation to set up accounts.
    I might have another solution next month with a blockchain application
    I’m currently using Western Union Business solutions and I crosschecked against Transferwise’s rates, and WUBS is still a bit cheaper (they gave me a preferred rate due to my volume). But I’m very interested in being ahead of the curve in terms of accepting cryptocurrencies, and while it may take several years for it to become commonplace among my customers, I’d at least like to start building out the option for people to pay in crypto. Feel free to ping me at mike@sacredridescom at any time if you have some solutions/ideas.
    Hey Mike (@mikebrcic),
    The challenge with crypto-currencies is the liquidity. We need more businesses to accept it so that banks see this as an attractive market to start becoming a market maker for it. If you use bitcoin exchanges today they average 0.5% to enter and 0.5% to exit the market so the cost in the industry is 1% and you need to add a premium to that to run a business that uses these technologies so it’s a tough one.

    Transferwise was mentioned — they are good and are one of our competitors.

    My company (Curexe) helps do this using existing payment rails and we only charge you 1% to move and exchange money. You will have the same delays just like using PayPal, Transferwise, your bank etc., but at least you aren’t getting charged Stripe’s 2.4% + 2.5% for the exchange.

    I’m a payments geek so if you ever want to chat give me a shout at (289) 968 7422.

    Cheers,
    Johnathan Holland

    Edited on December 17, 2016
    @davidogden Transferwise is a banking “hawala”. Banks is the essential part of Transwervise business so they have to follow all necessary KYC/AML compliance.
    There are no accounts in crypto, only wallets. If I receive crypto from another user, why would I be a subject to KYC? And with whom?

    @mikebrcic Technology is ready. Wallet is available for Android and Online. New wallet release is rolling next month with Facebook and SMS integration and 4 levels of securities added, plus few new features. If you’d like to test it, I’ll be happy to send you test wallet link. Any help from the BG community in testing and feedback would be greatly appreciated 🙂