The initial vision for Bitcoin was to be a peer-to-peer electronic cash system. The Bitcoin whitepaper states that the technology was designed to facilitate decentralized online payments without intermediaries. Although Bitcoin does operate outside of the traditional financial system, the primary use cases for Bitcoin appear to be as a store of wealth and a hedge against inflation. Furthermore, many investors see Bitcoin as a long-term investment like gold or stocks. Now, if you’re one of the many people who are wondering, “what can you buy with Bitcoin?”, read on!
In this “What Can You Buy with Bitcoin?” article, we’re going to explore some of the best ways you can spend your Bitcoin. Also, we’ll discuss some of the issues surrounding Bitcoin payments. Plus, we’ll look at some of the solutions that could help Bitcoin gain adoption.
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What is Bitcoin?
Before answering the question of “what can you buy with Bitcoin?”, let’s first take a look at the underlying asset itself. Bitcoin is the brainchild of pseudonymous developer(s) “Satoshi Nakamoto”, and the first blockchain and cryptocurrency. It operates as a peer-to-peer electronic cash system outside of any central authority.
The Bitcoin network uses a series of nodes to confirm transactions on a distributed ledger using cryptography and computer science. Furthermore, Bitcoin has a fixed supply of 21 million coins. Each Bitcoin enters circulation through a process known as mining. Bitcoin mining rigs are highly sophisticated computers that require a great deal of electricity to verify transactions. Miners can earn newly created Bitcoin rewards as they expend computational resources to compete for the right to append a block full of transactions to the blockchain.
Each node in the network holds an identical copy of the Bitcoin ledger. This contains all of the transactional data on the blockchain. Each transaction interlinks with the previous transaction. As such, the more activity that occurs on the Bitcoin network, the more computational power is needed to attack the network. Furthermore, Bitcoin has become a valuable store of wealth as an investment asset. Many even liken the asset to “digital gold” due to the properties it shares with the precious metal. Moreover, Bitcoin is scarce, fungible, and permissionless. It facilitates cross-border payments that are censorship-resistant.
Despite tremendous volatility, the price of Bitcoin increases year after year, almost every year historically. However, Bitcoin transactions require more technical knowledge than most traditional payments providers. Complex wallet addresses are easy to copy and paste incorrectly. Also, because Bitcoin is decentralized, you can lose your assets forever if you make a mistake.
What Can You Buy with Bitcoin?
Historically, Bitcoin has often been viewed as a store of value. However, despite the Bitcoin whitepaper stating that the cryptocurrency is designed as a “peer-to-peer electronic cash system,” many believe that Bitcoin is less suitable as a payment method than it ought to be. Furthermore, several other cryptocurrencies are designed to reduce friction in online payments. Accordingly, Bitcoin may not even be the most suitable cryptocurrency for executing online payments.
Relatively few retailers or stores accept crypto. Nevertheless, many shops, service providers, and retailers have begun accepting Bitcoin for payments. The growing popularity of Bitcoin and other cryptocurrencies is prompting an industry-wide shift towards the acceptance of cryptocurrencies. Not only does this provide greater flexibility for shoppers when paying for goods and services, but it also stands to disrupt the traditional financial sector by offering a viable decentralized alternative.
Now, let’s address the question of “what can you buy with Bitcoin?”. Below, we’ll take a look at some of the different types of goods and services you can pay for with Bitcoin. This includes both inside physical stores and online sellers.
Online Retailers
Several prominent online retailers accept Bitcoin for a range of goods and services. However, the majority still do not accept Bitcoin as payment. Despite this, a number of online retailers do accept gift cards that can be purchased using cryptocurrencies.
Big-name stores that accept Bitcoin include the home improvement giant Home Depot and e-commerce platform Shopify. In addition, tech giant Microsoft enables users to “top up” their accounts using Bitcoin.
Service Providers
Many different service providers are now looking to expand their user bases by accepting cryptocurrency payments. This includes several prominent email and virtual private network (VPN) providers such as NordVPN, ProtonMail, and ExpressVPN. Also, website and content management platform WordPress accept crypto payments, as does web hosting platform Vultr.
Furthermore, you can pay for online news subscriptions with Bitcoin from various media outlets based in the U.S. This includes Bloomberg and Chicago Sun-Times. Moreover, you can use Bitcoin to pay for cellular services from AT&T or for premium features on the social media platform Reddit.
Video Games
Crypto gaming platforms are becoming increasingly popular. Also, the rising utility of non-fungible tokens (NFTs) in blockchain gaming platforms is helping to drive mainstream adoption of cryptocurrencies.
However, some traditional gaming platforms are also getting on the bandwagon by accepting crypto payments. If you’re a gamer, you can pay for Xbox games and Xbox Live subscriptions. Also, you can buy games from other stores, including Humble Bundle and Big Fish Games.
Restaurants
This includes Whole Foods Market’s chain and also the Burger King and Subway fast-food chains. However, not all of these outlets accept crypto payments. Also, the KFC fast-food chain ran a “Bitcoin Bucket” promotion using the BitPay payments service.
Vacations
The travel industry has become more competitive than ever before. Some travel companies now accept Bitcoin and other cryptocurrency payments for flights and accommodation to address this. If you’re looking to get away this summer, you can pay for flights with Bitcoin using airBaltic or accommodation using Expedia.
Also, Expedia plans to introduce a crypto payment option for flights and activities. However, for the ultimate Bitcoin vacation, you could head towards the moon with Virgin Galactic, the first-ever commercial spaceship line which also accepts Bitcoin payments.
Luxury Items
Various luxury retailers and brands now accept Bitcoin payments for high-end goods. Be extravagant and splash out on a flashy new car but want to pay in Bitcoin? If so, online marketplaces such as BitCars and Auto Coin Cars accept various cryptocurrencies. Also, if you live in the south of England, check out the Prestige Cars Kent dealership.
If cars don’t quite scream “crypto billionaire,” then perhaps you might consider a yacht. You can purchase yachts with Bitcoin from Denison Yacht Sales. Alternatively, take to the skies with a private jet from Aviatrade. Or, find your perfect mansion using the Swiss real estate marketplace, Bithome.
Sports Teams
Perhaps you want to use your Bitcoin to enjoy sporting events or support your local team? More and more sports teams are embracing crypto every season. Athletes are getting paid in Bitcoin. Plus, several teams are gaining sponsorship deals with crypto firms in multiple popular sports.
If you’re from the Florida area, you can pay to see the Miami Dolphins by using Bitcoin. Also, for soccer fans in the U.K., Real Bedford FC is a Bitcoin-positive football club sponsored by crypto exchange Gemini. Also, Real Bedford accepts Bitcoin donations. Plus, the Oakland A’s are the first Major League Baseball team to begin accepting Bitcoin and other cryptocurrencies for ticket purchases.
Disadvantages of Using Bitcoin for Payments
Despite several upgrades to improve the transaction processing ability of the Bitcoin network, transactions are still relatively slow, particularly when compared to other cryptocurrencies on other blockchains. Also, Bitcoin transaction fees are more expensive than many other networks. That said, the Bitcoin network is arguably the most secure computing network in existence. Accordingly, many other crypto payment methods lack the robust security of the number one blockchain.
Despite the initial vision of an electronic cash system, Bitcoin is widely viewed as a long-term investment asset like gold. This is because the price of Bitcoin has outperformed the price of the U.S. dollar; thus, the asset can help to preserve wealth. However, a substantial portion of the Bitcoin community would like to see Bitcoin’s true purpose become a reality.
The introduction of the segregated witness (SegWit) protocol and Lightning Network suggests that this may be achievable. Plus, many projects are already adopting Lightning Network to propel Bitcoin further into the payments sphere. However, these advancements still fall short of what many in the industry expect. Moreover, the Bitcoin network can only process seven transactions a second. When you compare this to the 65,000 TPS that Visa can process, it’s clear that we still have a long way to go. Also, the Bitcoin network becomes more expensive and slower during times of congestion.
Lightning Network
Lightning Network is a Bitcoin scaling solution that uses state channels to facilitate almost instant transaction confirmations with minimal transaction fees. However, the adoption and development of Lightning Network are relatively slow. That said, tangible development is underway, with payments providers such as Cash App recently announcing support for Lightning Network payments.
Moreover, the intention of this scaling solution is to make Bitcoin a viable solution for small, everyday purchases such as groceries. If this is to become a reality, Bitcoin and Lightning Network could heavily disrupt the legacy payments sector.
Why Spend Bitcoin?
Although making payments with Bitcoin is becoming more accessible, many investors would prefer to spend their government-issued fiat currency and instead hold on to their Bitcoin. One reason for this is the fixed supply of Bitcoin. Whereas fiat currency can be printed at any time, there will only ever be 21 million Bitcoin that enter circulation. Also, many of these are already lost, making the asset even more scarce.
With that said, there are many reasons for wanting to spend Bitcoin. For example, some national currencies that suffer from hyperinflation are more volatile than Bitcoin. In some struggling economies, Bitcoin is a safe haven and a hedge against inflation. Even if it is less convenient than traditional payments services, it bypasses the need to hold onto currencies that regularly fall in value.
Furthermore, Bitcoin is censorship-resistant. Anyone with an internet connection can make a Bitcoin transaction from anywhere in the world. Plus, holding Bitcoin as a long-term investment means that you could potentially have more dollar value than you would if you were holding cash. Moreover, to truly be your own bank and operate outside of the legacy financial system, a decentralized currency such as Bitcoin is the ideal solution.
What Can You Buy with Bitcoin? – Summary
So, what can you buy with Bitcoin? Well, apparently, quite a lot of different things. Also, the technologies enabling Bitcoin payments to become more accessible are already being put into action by major payment providers. As such, processing crypto payments is becoming increasingly attractive for more retailers than ever before. However, different geographies have varying degrees of support for crypto payments. Moreover, it is against the law to use Bitcoin for payments in some countries.
Also, the infrastructure for Bitcoin purchases is far from ideal. However, the development and progress in the space show promising signs. Accordingly, we can expect to see more retailers and service providers opting to support cryptocurrency payments in the coming months.
If you want to become a blockchain developer, check out the Bitcoin Programming 101 course at Moralis Academy! This course teaches students how to use the “Script” programming language to interact with the Bitcoin blockchain. Furthermore, our Lightning Network 101 course teaches students about the infrastructure that is transforming the Bitcoin blockchain to facilitate frictionless payments.
Become blockchain certified with Moralis Academy! Also, don’t forget to follow us on Twitter @MoralisAcademy! Furthermore, after this “What Can You Buy with Bitcoin?” article, see our “Blockchain in Supply Chain” and “Web3 Browsers” articles for further reading!
