Tuesday , September 26, 2023

How OLB Group Hopes to Win Over Merchants for Cryptocurrency Acceptance

Betting that consumer demand to use cryptocurrency as a payment vehicle will rise over the long term, payments provider The OLB Group Inc. announced Wednesday that its SecurePay payment gateway will support the acceptance of Bitcoin and other digital currencies at the point of sale regardless of the merchant platform.

New York City-based OLB says its decision is based on what it sees as young consumers’ growing affinity for digital currencies. “There are young consumers that don’t like bank accounts and the fees associated with them,” says chief executive Ronny Yakov. “We don’t expect consumers to stop using cards or cash to pay for purchases, but we do see consumers wanting to pay using cryptocurrency, and we want to be positioned to support it. A year ago, contactless card acceptance was a tough sell, now merchants are asking for it.”

OLB, whose merchant portfolio is evenly split between physical and e-commerce merchants, is supporting acceptance of all cryptocurrencies, including Bitcoin, Ethereum, USDC, and DAI, across all merchant platforms, as well all cryptocurrency wallets, including MetaMask, Coinbase Wallet, Crypto.com, and Trust Wallets. To initiate a purchase, consumers open their cryptocurrency wallet and scan a QR code that appears on the merchant’s POS device.

To make cryptocurrency an attractive payment option to merchants worried about value fluctuations, OLB will support stablecoins, which are cryptocurrencies collateralized against a fiat currency, such as the dollar, to reduce their volatility. The coins will be collateralized by a licensed cryptocurrency provider, and merchants will be paid in dollars, OLB says.

Value volatility has long been a stumbling block to merchant acceptance. Historically, merchants and processors couldn’t be certain of a crypto coin’s value at the time of purchase, which makes it difficult to know what percentage of a coin’s value to debit for a purchase. Bitcoin’s value, for example, surpassed $40,000 earlier this year, quadrupling since October.

Merchant resistance to accepting cryptocurrency does appear to be easing. PayPal Holdings Inc., for example, announced it will enable cryptocurrency as a funding source for purchases beginning this year. PayPal users will be able to use their cryptocurrency holdings to make purchases at PayPal’s network of more than 26 million merchants, with funding to merchants occurring in fiat currency.

News of OLB’s announcement sent the company’s stock price soaring more than 80% in premarket trading. OLB, which went public on the NASDAQ exchange in August, has also applied for a cryptocurrency license in the state of New York.

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