Dive Brief:
- Silicon Valley jeweler and gemologist Stephen Silver Fine Jewelry, an early retail adopter of cryptocurrency payment processing, attributes its "tremendous" sales growth in recent years to the blockchain technology, according to a press release.
- The jeweler began accepting payments by cryptocurrency in 2014, and the company said 20% of sales are now being paid by digital currency.
- Cumulative sales for the company through cryptocurrency now total in the millions of dollars, surpassing credit card purchases, chief executive officer Stephen Silver said in a statement.
Dive Insight:
Global retailers have so far been at the forefront of cryptocurrency acceptance, with Asian companies like JD.com, Rakuten and an online mall from MegaX taking bitcoin. Newegg recently expanded its acceptance of bitcoin from the U.S. into Canada. Like all large retailers, Amazon is keeping a close eye on cryptocurrency and recently registered three Internet domain names related to blockchain payments.
The Silvers' clientele includes elite gemstone collectors and successful figures in the technology industry from Silicon Valley and around the world, according to the company. With an international clientele, the blockchain-based payments have the additional benefit of easing cross-border payment issues, such as reliability and processing costs.
Company president Jared Silver (Stephen's son) told JCK the company has done "over eight figures" through cryptocurrency in the last six months.
The immediacy of cryptocurrency transactions is especially appealing to a global clientele, who appreciate the ability to instantaneously purchase important color gemstones. "We've created revenue that the company would not even enjoy without being able to accept cryptocurrency," Stephen Silver said in the press release. "Large sums of money are where we are finding cryptocurrency to be a huge advantage."
Investors can use cryptocurrency to make major purchases of millions of dollars from anywhere in the world, with an immediacy that cuts out third-party wire transfers and credit card processers, said Jared Silver in the press release. They can also save up to 1.5% on purchases made with bitcoin, as they won't incur conversion fees.
There are still plenty of problems associated with cryptocurrencies as well. Volatility is one. Over the course of about three months this year, bitcoin lost an incredible 48% of its value by March, according to Bloomberg. Also, the number of retail outlets and legitimate businesses accepting it and other cryptocurrencies is still quite limited.
The use of bitcoin and other cryptocurrencies in money laundering, illicit trades and black markets — most famously the Silk Road site, which the FBI shut down in 2013 — has made governments around the world wary of them. And fraud in cryptocurrency investment has become so rampant that tech platforms, including Google and Facebook, have banned cryptocurrency-related advertisements.
