Avnet Inc., a technology supplier for industries as diverse as automotive, communications, energy, and wearables, quickly has found that accepting Bitcoin via BitPay Inc. is a hit, especially with the Bitcoin mining industry.
Atlanta-based BitPay announced this week that Phoenix-based Avnet uses it for Bitcoin and Bitcoin Cash transactions.
With more than 2 million customers worldwide, Avnet says Bitcoin acceptance can be cheaper than traditional money transfer options, especially for cross-border payments, Sunny Trinh, vice president of demand creation, tells Digital Transactions News. BitPay lists a 1% transaction fee on its Web site with daily bank settlements in dollars, euros, and the peso. It was especially apt to add BitPay because many Avnet customers wanting to pay with Bitcoin are in the cryptocurrency industry, Trinh says.
Adding the cryptocurrency acceptance method was a simple technology change for Avnet, Trinh says, but took a little more work for the company’s internal processes to adapt. “It took about three months to get to this point,” Trinh says.
Its Bitcoin transactions are between $100,000 and $1 million, Trinh says. A transaction begins when an Avnet customer decides to use Bitcoin or Bitcoin Cash to pay an invoice. Within the BitPay system the customer and Avnet will agree on a conversion rate from the digital currency to U.S. dollars. That rate is valid for 15 minutes. If no action is taken, a new rate is generated. The conversion into U.S. dollars happens within BitPay’s network. Avnet receives its funds in dollars.
Previously, a customer paying in the cryptocurrency had to log onto a Bitcoin exchange, find the conversion rate, and complete the transaction manually, Trinh says. “What this really helps is our customers,” he says. “They don’t have to do the conversion.”
Trinh’s advice to merchants considering adding Bitcoin acceptance is to ensure there is enough demand to warrant it. If so, adding acceptance is not so daunting. “It’s not as hard as you think,” Trinh says. Just make sure it fits your business model, he advises.