A cryptocurrency primer for e-commerce.
Tesla announced today that it was buying $1.5 billion in Bitcoin and would soon accept the currency as payment for its vehicles. Both Bitcoin and Tesla seem to have realized some short-term financial benefit from this news (as Mr. Musk no doubt intended), but I’m sure it left a lot of folks scratching their heads. While Bitcoin has become a speculative financial instrument long unmoored from its original purpose, cryptocurrency in general is starting to tease around the margins of payment and commerce. If you’re selling things online, you might be wondering what all this means to you.
The short answer is not much, at least for now. You probably won’t accept cryptocurrency as a payment method anytime soon. Crypto has created enough of a stink that, for a time, there was a sense in the e-commerce world that it might muscle in as an entirely different way of paying for things, like PayPal or Venmo. But it’s worth remembering that those services, process innovations aside, are still moving dollars or Euros or pesos around. For better or worse, most of the world runs on fiat currency, which is a fancy way of saying money whose value is determined by governments (and no, I’m not going to talk about gold, so don’t even start with me).
So, what the heck is cryptocurrency, anyway? Put simply, cryptocurrency is both a currency and an anonymous ledger (the anonymous part is important, but hang on for a sec). A dollar bill is currency, and it’s often anonymous, in the sense that you don’t sign your name to it in order to pay someone else (like a check or a credit card receipt, which is really just an IOU for some amount of dollar bills). Ultimately, though, it’s cumbersome to conduct big business with hard currency. There just aren’t enough wheelbarrows around.
Also, unless you’re selling weed and don’t want the government to know what you’re up to, you need to keep track of all those dollars, whether in real or IOU form. That’s a ledger – just a list of transactions, one after the other. Hard cash businesses (at least aboveboard ones) have ledgers too, but most businesses operate astride a vast and complex set of IOUs and assurances that, somewhere, somehow, if they had to, they could walk into the bank and withdraw a wheelbarrow full of hard cash.
There are some persistently thorny issues with this arrangement, as you’ve probably seen. Middlemen of every stripe want to skim a penny here, a half penny there, for the privilege of moving your money around. Exchange rates fluctuate, so tomorrow your scratch might get you a few less potatoes from the fellow across the river than it did today. And you might indeed have some perfectly valid reasons to not want every prying eye ogling your ledger, yet still want to conduct business without paper or coin (this is one reason why cryptocurrency is starting to see adoption in the third world – many people have phones, but carrying cash can be risky).
Cryptocurrency attempts to remedy all this by establishing itself as an alternate currency (we won’t talk about value yet, which is, yeah, a thing) with some form of a ledger built in. In other words, the currency itself contains the ledger. This is often built on the foundational concept of the blockchain, a very fancy ledger where each transaction more or less verifies the previous one and the entire ledger is unalterable and encrypted. I’m simplifying a bit, but the concept is fairly straightforward, and once you grok its core purpose — the elimination of a central authority to validate transactions — it starts to make sense. When someone hands you a dollar bill (unlike a check, or a credit card), you don’t even need to think about calling someone to see if it’s real. Now, if that dollar bill could move through the internet and through any number of people and countries and still be what it started out as – an anonymous transmitter of value that no one in all the intervening steps could get their grubby hands on – you’d have what a lot of nerds consider to be an ideal currency.
(As an aside, some cryptocurrencies can be “mined”; that is, created out of thin air by computers. This was designed as a way of sharing the computing load of all the encryption the blockchain requires. The theory was that if you paid folks a tiny morsel of said currency to handle the distributed nature of validation and encryption, you could cover the computing costs of decentralization. Instead, because Bitcoin is so valuable, Bitcoin mining is now an absurd industry that uses roughly nine nuclear plants worth of energy every day to create currency. You might as well call it KiloWattCoin, since it’s turning electricity into money.)
But is crypto an ideal replacement for fiat currency? Not yet. It might be, eventually, in some form. A lot of insanely smart people are working to make this happen. It won’t be with Bitcoin itself, which, despite what Elon Musk may claim to the contrary, is no longer really a currency but a purely speculative financial instrument. This is where that pesky value problem comes in. If you don’t peg crypto to anything at all, its value is whatever everyone who holds it (or wants it) thinks it is. There’s nothing inherently wrong with that; currency is always no more than what everyone agrees it is (it’s just that in certain cases the chorus is anchored by some very deep voices, namely governments and their banks). Bitcoin isn’t pegged to anything and is about as predictable as a broken roulette wheel. It also has a pressing technical quandary: The transaction volume over time has created a near-unmanageable computational load. Turns out that hardening your ever-growing ledger with world-beating encryption has some undesirable side effects once you’re hundreds of millions of transactions down the chain.
Bitcoin is thankfully off the table as far as a normal transactional currency you need to think about. Stripe, one of the biggest payment technology companies, dropped support for Bitcoin a few years ago; their explanation as to why is a model of economical economic prose, and well worth reading if you want to understand a little bit more about why Bitcoin is viewed primarily as an asset rather than a means of exchange.
The cryptocurrencies I vote Most Likely to Succeed will likely matriculate from the school of “stablecoin”, which I suppose is what happens when you fix what ain’t broke then have to break it again. Stablecoins are cryptocurrencies that are pegged to some real-world value, like dollars or Euros or gold or silver or even, in a delightfully recursive loop, other cryptocurrencies. Stablecoins take the “good” part of crypto – anonymized, electronic, borderless cash – and remove the crappy parts, like crazy volatility and onerous ledger maintenance. Stablecoins are making inroads in third-world cash economies where the adoption of inexpensive mobile phones has outpaced all the payment infrastructure and credit issuance that we take for granted. It’s possible at some point in the next ten years we’ll see one or more stablecoins make their way into global commerce.
Of course, the final hurdle for worldwide cryptocurrency adoption is the bogeyman it was partly created to avoid: The tax man. Anonymous, distributed transactions are anathema to regulation, taxation and half the other things that make most governments run. Government may not be able to stop the tide of cryptocurrency, but it’s absolutely going to be a giant pain in the ass about it. What else is new?
2020 may be a year to forget in many ways, but we’ve been plugging away at some big changes for 2021 that we’re excited to show you very soon. In the meantime, we’re happy to announce that storeBlox CS now supports ShipStation!
Yep, in addition to the roughly six-bajillion shipping options (we might be exaggerating that number, please don’t call your lawyer) currently available in storeBlox CS, you can now integrate directly with ShipStation!
ShipStation is a nifty service for shipping at best available rates, printing shipping labels, tracking shipments and a whole lot more. When you plug in ShipStation to your storeBlox CS company store (and it’s super easy, just see below), your storeBlox CS orders are pushed into ShipStation; when you ship orders the tracking information is synchronized with your storeBlox CS store automatically.
A few fields is all you need to get set up, but as always we’re here to help you through the process. Just drop us a line or give us a shout at 512-867-1001 and we’ll get you set up. Need to learn more about setting up your shipping options? Check out our Video Learning Center for walkthroughs and tips.
When you create technology products, you have to iterate, iterate and iterate some more to get them right. eBlox built the first “virtual sample” product in the promotional products industry about twenty years ago for Norwood Promotional Products. Many things have changed since then; Norwood is now part of Bic, and the kind of technology that was once popular for virtual samples—Adobe’s Flash—has been relegated to the dustbin.
But people still need to present ideas to their clients, so the need for virtual samples is as big as ever. Our longtime client 3M Promotional Markets decided a few years ago that they wanted a virtual sample tool where users could very quickly and seamlessly create sample Post-It® custom printed note pad designs, so we took to pen and paper —ok, not really; we used a bunch of cool programs and prototyping tools. But we made something cool, and you should check it out.
Our primary goal with the 3M Virtual Sample tool was simple: Instant gratification. Most industry virtual sample tools force you to load up popups and deal with a completely different user interface. We wanted something that was built into the existing structure, using the same look and feel as the web site:
Secondarily, we wanted it to be reasonably bomb-proof. Virtual sample and online design tools often turn into miniature versions of desktop graphic design tools—they’re loaded up with options, transformations, clip art and all sorts of other things that distract from getting the job done quickly. So, we stripped out everything we possibly could to simplify the process. Everything you see is what you can do. No hidden menus, buried features or tricky operations. No funky technology that has problems with different browsers or touch devices. Simple and effective.
We added some cool orientation controls as well, since you can take a Post-It® note and turn the adhesive side however you’d like for printing. You can also quickly swap pad sizes to see different layouts:
Finally, we wanted to make sharing easy throughout the process. Most virtual samples let you share them; ours has a one-click PDF spec sheet, with your full sample and all related product information. Each product has a unique ID that can be shared with anyone who needs to see or provide feedback on the sample. And an instant, drop-down Project listing makes it easy to copy and share new projects.
Please go check it out when you get a chance and let us know what you think!