Incentives For HBD to Become Desireable as a Payment Method
I wonder if we are approaching the whole HBD adoption as a payment method the wrong way.
Without being at the heart of the phenomenon, it seems to me we are approaching businesses thinking they may be interested in a couple of new customers they might receive that already use Hive and who would be interested in this payment method.
Maybe small businesses are attracted by such a deal, but big ones, that already have dozens or hundreds of customers daily, maybe not so much.
What if we approach things differently, at least in some cases?
No Fees
I know we've been saying "so fees" left and right and it doesn't seem to work.
But maybe we haven't found the right ways to say it yet.
What does every store, physical or online, have to pay VISA, and I assume all other major and minor payment networks? That's right, a fee. For VISA, it's 5% per transaction. Some fees are supported by the stores, but included in prices, others are paid directly by customers. On payments online you can often see that 5% fee for VISA, but not always.
Well, Hive doesn't have any fee. 5% per customer when you have hundreds of customers daily amounts to something.
Then, if it's a physical store, it needs a POS (or more) and a business bank account. I know someone who had to do both recently and wasn't very happy. They are prohibited from being paid in crypto (!), or I would have suggested HBD to them. Not that it would have helped much with many of their clients.
If we are talking about cash (as much as I love its privacy feature), it needs increased security measures, special transport, etc., none of these services or employees being free or voluntary.
Hive solves all that. You don't need a POS, a business bank account, enhanced security measures, and special transport for cash. Everything is taken care of by a normal smartphone, the Hive network, and its applications like Hive Keychain or V4V.app (from what I know at no costs/fees on these apps because they are paid by the Decentralized Hive Fund).
Fight Against Inflation of Your National Currency
As we know, HBD is quite well-received by a relatively wide network of businesses in Cumaná, Venezuela.
The Venezuelan Bolivar had an almost 190% inflation rate in 2023. That's an almost unimaginable inflation rate in well-established countries, even less over a prolonged period. I experienced a similar inflation rate in the early 1990s after communism fell in our country, so I can relate, even though I was only a kid back then.
I checked what the biggest business that accepts HBD in Cumaná was doing with it last year. Other than paying for a few services, they just sat on it until the year-end. They didn't even move it to savings for the extra 20%. When you lose 190% in a year on your national currency (and I assume the main currency they use), holding the US dollar-pegged token for as long as you could was the smartest thing to do.
I know from experience, that with such hyperinflation, money needs to be spent almost immediately to not lose value. But a hypermarket? How can they not lose due to inflation? Maybe they have deals with suppliers in USD instead of Venezuelan Bolivar. I don't know... Hard times... Why not have deals in HBD, btw?
Anyway, I don't know how much it meant this cash on hand for Hola Supercenter, but they surely could hold on to the HBD for the entire 2023 without losing any of that terrible 190% their national currency lost to inflation.
An interest may or may not be interesting to a business in a country with hyperinflation, but protection against inflation is surely something they are interested in.
Other countries experience hyperinflation, and their businesses could use HBD as a protection against it.
Why Not Use Bitcoin Instead of HBD?
Especially in the bull market, people would say it's wiser for businesses to use Bitcoin (Lightning) instead of HBD as a payment method. After all, Bitcoin goes up in a bull market, and HBD remains relatively constant in dollar terms.
These are two different things in my opinion. One is an investment or speculative decision, the other is a commercial decision. As long as commerce is done mainly in USD, you can't use a volatile coin in commerce, may that be Bitcoin or Hive. It needs to be a stablecoin.
Otherwise, of course, with complex strategies that involve hedging, I don't see why a volatile coin compared to USD wouldn't be used.
Better Visibility, Publicity, or Bonuses to Use HBD Payments
If I were a business that didn't lose 190% in a year because of using HBD, would I be interested in more of my customers using this payment method? I would say yes. And retailers know how to offer incentives to push their customers in a certain direction.
If I were a business paying fees and fiat-related services and jobs left and right, would I be interested in not paying them anymore (or at least fewer)? I would say yes.
HBD offers a lot of advantages. Maybe its only drawbacks at the moment are that it's too small and too little connected.
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I believe HBD will gain more adoption if we promote it to business that already acept Bitcoin Lightning Network. With v4v.app they can accept BLN and receive a stablecoin without the risk of volatility.
That makes sense from the time the price was set to the time of the payment. What happens after the purchase? They'd have to:
option 1) watch for the price of Bitcoin all the time, learn about its cycles, get scared when there's a pullback, or
option 2) sell it every time they get it, which is kind of inconvenient, or
option 3) become experts in the markets and hedging, even though they sell meat, for example.
Otherwise, I've already seen HBD leveraged as a payment option where BLN was accepted, but that doesn't make HBD more attractive, it just represents a way of spending the HBD we earn over here.
Thanks for dropping by!
You missunderstood my point, business that accept BLN can be introduced to HBD as solution. They charge the client BLN but receive instead HBD and protect themselves against volatility holding a decentralized stablecoin and earning some interest in the process if they send HBD to Savings.
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I have thought about these things, and how to make HBD work in the Philippines. The biggest hurdle I am facing, is how they can convert their crypto to Fiat. Small businesses tend to have lesser capital, so their sales are usually used to buy the ingredients and materials they use. You mentioned Hive doesn't have fees, but converting crypto to Fiat usually do. I have thought of offering the conversion service, but one would need a lot of liquid funds for that.
You make a good point about the existence of crypto->fiat offramp fees. I wonder if p2p no-fee exchanges would work for this purpose.
What if these small shops onboard some of their customers to Hive and offer them HBD for PHP. The incentive for customers would be a small discount for paying with HBD, for example, other than the additional benefits of having a Hive account (someone could offer free accounts for the shop), and the shop owner gets fiat to buy what it needs to supply the shop.
Those are good options. p2p no-fee would definitely be helpful, that is why I was considering it before. But the one providing the Fiat is taking most of the risk, since they're taking a stablecoin that has little upside, and will incur the fees if they want to convert it to Fiat themself. I can technically put the HBD to the savings, I just don't have enough funds or liquidity to steadily provide the Fiat haha. There is also the option of the store making a Hive account, and making me a small beneficiary in their rewards.
As for other discounts, I was actually thinking that the store can encourage the clients to make a Hive account, and post about their order and experience. The store and I can upvote it [with what little upvote power we have] to get them started, and maybe ask HivePH for some support as well. The store can give a discount on their order for their efforts [or I can pay for the discount].
There are a lot of options, but no funds haha.
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The Latin American countries may have a better chance, but the problem is the overall ecosystem is SO SMALL that HBD is on virtually nobody's radar. It is not far from the 1000th position in marketcap and has an extremely low marketcap.
You may be able to onboard a shop or two, but it's going to be hard. In the US, you might as well count it out.
Hivelist has been accepting HBD for 4 years on their online store, and virtually nobody uses it. The last few orders were paid in fiat and few in Monero, and those orders were from customers that weren't not in the Hive ecosystem and came from Twitter referrals.
I agree. The size of HBD is a big problem if we want to deal with bigger retailers or on advantageous conditions. And highly regulated countries like the USA, or those in Europe (and not only) are unlikely to sit back and allow this in their yards.
That's bad to hear about Hivelist. If we don't use HBD in online stores from our own backyard, will we do it elsewhere? Anyway, the point was to attract outsiders, but here's where the size of HBD stands in the way probably.
One thing is that anyone who went through the collapse of UST in the last cycle has PTSD when you mention an algorithmic stablecoin.
But yeah, the community has pretty shown me what they think about e-commerce and building real world use cases. Most only want a token to turn around and dump.
The HBD 20% savings plays a big role in this too. Keeps people saving instead of spending.
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Hbd like in a credit card to pay on shops and stuff would be a dream, and much more people would onboard hive
HBD directly on a credit card (or even a debit card) I don't see happening any time soon.
Most crypto cards that are out there use crypto to top up a regular fiat debit card, most often VISA.
But I would see something like "5% (Extra) Discount for Payment via HBD" shown by certain retailers which would put HBD in the spotlight. The question is if we want this kind of spotlight, lol.
I think there are some downsides but I still think we need to promote HBD if we want HBD to succeed. I guess we could do something similar to what v4app is doing with lightning but most people there just won't know about Hive or HBD then.
Yes, that's piggybacking off BLN network, but other than using its distribution network, Hive will show up anywhere.
@yecier made an interesting comment which I didn't understand at first, on why don't we use this relationship in reverse? Someone can pay with BLN but the shop owners can receive and hold HBD, a stablecoin, instead of the volatile BLN.
The problem is that we need to onboard business owners, the BLN network doesn't help at all in this case, other than potential customers for the respective businesses.
This might be a massive change to see HBD as a payment method 🎆🎆🎆
Very very informative thank you 🍀🌿🍀
It is a payment option here and there. Especially in Venezuela and a little in other parts of Latin America.
Waiting to see it happen in Asia 🌏
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Hope that day will come soon. Thanks for sharing!
Well, when we were on the other chain with the "stablecoin" there, nobody would have dreamt of where we are now with HBD...
HBD will still be one of the top stable currencies after it becomes stable
I’m sure it is just a matter of time
I don't think there are plans to make it more stable.
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