Merchant Adoption is Pointless without Regular & Growing Inflows

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Avatar for georgedonnelly
3 years ago

The first thing a new crypto user always asks me when they get some crypto is, "What the heck can I do with this stuff?"

The answer is merchant adoption. We have to have merchants who accept Bitcoin Cash for goods and services that are in demand.

Literally everything is merchant adoption because if you can't spend it, it's not money.

What do Merchants Need?

But what do the merchants need?

We never ask this question because understandably we are focused on our needs.

After 2 years of full-time crypto mass adoption work in 8 Latin American nations, I know what merchants need, and it doesn't take a genius to figure it out.

They want customers. They want income. They want to grow.

If we promise them Bitcoin-Cash-paying customers, they will accept Bitcoin Cash - as long as there are also good liquidity options.

But then what? How many people are spending BCH? How often does the merchant get customers who pay with Bitcoin Cash?

Enter Consumer Adoption

This is where consumer adoption comes in. If you thought merchant adoption was hard, wait till you try getting everyday Joe consumers to buy, hold and use BCH instead of their national fiat.

It's HARD.

Merchant Goes Ouch

So, you've got these merchants, and not a lot of people are spending BCH with them.

Let's rewind. When they agreed to accept BCH, maybe only 1 out of 5 neighborhood merchants said yes. Most of the other merchants gave a quiet no. But there is always one guy, let's call him Hater Troll for short, who says the whole thing is a scam and anyone who accepts crypto is a FOOL!

So our risk-taking merchant who said yes, let's call him Bob, he let us put acceptance stickers up. But no one is paying with BCH. Now his neighbor Hater Troll comes over and starts wearing Bob down. Now Bob feels disappointed. Maybe Bob feels tricked. Where are those new customers? He probably forgot how to use the apps we gave him. His business creates enough stress for him already. Why add more??

We just lost Bob.


OK. Now we know. Without a consistent and growing flow of customers who find it advantageous to pay with Bitcoin Cash, merchants become discouraged and stop accepting.

That's time lost, resources wasted, relationships burned.

My team confirmed this when we reached out in early 2019 to merchants listed as accepting Bitcoin and Bitcoin Cash. Only 1 out of 40 remained active. And that guy was pissed off.

But hold on, there is good news.

Remittances in the House

There is a service people make use of a lot that involves annual cross-border flows of USD$689 billion. Yeah, BILLION. And most of it goes to the developing world.

I'm talking about remittances here. Western Union. MoneyGram.

Consider Gustavo in Miami. He busts his butt for bucks waiting tables at a Cuban restaurant precisely so he can send some cash home to keep the wife and kids fed in Caracas, Venezuela in the middle of a hyper-inflationary crisis.

He can't just wire dollars home. And he left Venezuela because the government broke the economy. So he's no fan of Bolivars.

Gustavo is actively in the market for another currency.

When Gustavo finds out Bitcoin Cash has better rates, is faster and his family can spend it directly for needed products and services in Venezuela (because we did merchant adoption), Gustavo might just give us a chance to blow his hair back.

Which means a new customer for Bob, if he's still taking our calls.

Let's Get this Straight

So, I'm not saying anything against the courageous folks signing up merchants here and there on a volunteer basis. Au contraire, they are our diehards, our pioneers, our heroes.

So, let's get their backs and ensure what they are doing is sustainable. Let's give them a system to plug into that protects and enhances their work.

Merchant adoption alone is a DEAD END.

We need to think bigger. We need to build BCH remittances. We need to incentivize remittance recipients to not cash out all their BCH, and even to spend it directly at Bitcoin Cash merchants.

My team signed up more than 1300 merchants in 2018-2019. And we kept 89% of them even through the darkest parts of the bear market.

But the fact is undeniable: focusing primarily on merchants is not a winning strategy all on its own. A focus on merchant adoption is an important first step. It creates a supply of things you can buy with Bitcoin Cash.

But then we need demand.

Remittances are that demand.

How are we going to make BCH remittances not just painless, but fun?

Who's in for that project?

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Avatar for georgedonnelly
3 years ago


I think a big problem for merchants at the moment is the high volatility of Bitcoin Cash. Companies like BitPay or GoCrypto immediately switch to fiat. So the merchant has no risk. But it is not an option for small merchants in the Philippines or Latin America.

I think that your idea is very good and that it does not require a large investment. If I had relatives in distant countries, this is how I would proceed. I would buy BCH on my exchange with Euro, withdraw it immediately and send it to my relatives' BCH addresses. They would exchange it for peso, bolivar or whatever on their exchange as soon as possible or even keep it in BCH if they wanted to take the risk (but most people don't want to take any risk). The whole procedure would not take long and my relatives would have the money without any risk and almost without any fee (only the fees that are charged at the exchange). I could do it again and again and also send smaller amounts.

Although it is not what Bitcoin was invented for, it is a good application at the moment. Later, when prices stop fluctuating and more and more people own BCH, the merchants will offer their goods for BCH themselves.

$ 0.05
3 years ago

Thanks for your comment!

I ran 1300 merchants for 16 months without the option for automatic exit.

But I did run a bespoke OTC desk for the merchants. Only maybe 15% used it the same day they received some crypto.

So, as long as there is P2P liquidity, the automatic exit is not strictly necessary to begin.

Definitely helpful for the medium term tho.

The ones who need more stability options are the consumers. Without them, they exit to fiat ASAP or just don't buy in. And then they delete their wallets.

I'm sure some day merchants will denominate in BCH, but there is a lot of challenging work to be done before we can expect that.

$ 0.00
3 years ago

Perhaps the merchants are more willing to take risks because they are used to taking risks when doing business. There are simply too few customers who own BCH and want to spend it. If BCH were used for transnational money transfers, as you suggest, many more people would come into contact with BCH.

$ 0.05
3 years ago

Indeed, getting customers to the merchants is how we keep merchants and get more.

How do we get more customers to go to the merchants? After about a year of focused research on that topic, I am seeing remittances far and away as the best vehicle for that.

$ 0.00
3 years ago

I think a major problem for those of us in the USA, is taxability of each transaction. The record keeping is too onerous. We need a tax friendly policy here.

$ 0.00
3 years ago

Sir, I like to read all your posts.

$ 0.00
3 years ago

সুতরাং, আমি স্বেচ্ছাসেবীর ভিত্তিতে এখানে এবং সেখানে বণিকদের সাইন আপ করতে সাহসী লোকদের বিরুদ্ধে কিছুই বলছি না। এগুলি বিপরীতে, তারা আমাদের ডায়ারহার্ডস, আমাদের অগ্রগামী, আমাদের নায়ক।

সুতরাং, আসুন তাদের পিঠ পান এবং তারা কী করছে তা টেকসই তা নিশ্চিত করুন। আসুন তাদের প্লাগ ইন করার জন্য একটি সিস্টেম দিন যা তাদের কাজ রক্ষা করে এবং বাড়ায়।

একা বণিকদের দত্তক নেওয়ার একটি শেষ সমাপ্তি।

আমাদের আরও বড় চিন্তা করা দরকার। আমাদের বিসিএইচ রেমিটেন্স তৈরি করা দরকার। আমাদের রেমিট্যান্স প্রাপকদের তাদের সমস্ত বিসিএইচ নগদ না করার জন্য এবং এমনকি এটি সরাসরি বিটকয়েন নগদ বণিকদের ব্যয় করতে উত্সাহিত করা দরকার।

আমার দল 2018-2019 এ 1300 এরও বেশি ব্যবসায়ীকে সাইন আপ করেছে। এবং আমরা তাদের 89% এমনকি ভালুকের বাজারের অন্ধকার অংশগুলির মধ্যে দিয়েছি।

তবে ঘটনাটি অনস্বীকার্য: মূলত বণিকদের উপর মনোনিবেশ করা নিজস্বভাবে বিজয়ী কৌশল নয়। বণিকদের গ্রহণের উপর দৃষ্টি নিবদ্ধ করা একটি গুরুত্বপূর্ণ প্রথম পদক্ষেপ is এটি বিটকয়েন নগদ দিয়ে আপনি কিনতে পারেন এমন সামগ্রীর সরবরাহ সরবরাহ করে।

তবে তারপরে আমাদের চাহিদা দরকার।

রেমিট্যান্স সেই চাহিদা।

আমরা কীভাবে বিসিএইচ রেমিটেন্সগুলি কেবল বেদনাদায়ক নয়, মজাদার করব?

এই প্রকল্পের জন্য কে?

$ 0.00
3 years ago

I liquity provider that is willing to sell BCH for fiat in either cash or as bank deposits. But it needs to be settled in a non.custodial p2p manner. SO - "someone" that is willing to be a profile on e.g. and be trustworthy that can provide millions in BCH for fiat. So education on how to use and a hint on what profile to buy the BCH from on

$ 0.10
3 years ago

Thanks for your comment!

Indeed, I would like to put some resources into recruiting, training and supporting hundreds of new liquidity providers for in the next few months because we are going to need more liquidity to realize this vision.

Interested to hear any other thoughts you might have.

$ 0.05
3 years ago

You're welcome. Keep up the good fight :-)

$ 0.00
3 years ago

I think it's a cool project and that you understand the cycle really well. I think it's very cool idea that a person getting a remittance can spend it locally. Though I still don't understand how we can help (even after glancing through the business plan.. man it's huge!) I think it needs some simpler steps - like we need this, this and this, in exchange you get a chance to get this and this.

Again, the idea is really cool, but I don't understand the "Who's in for that project?" part :)

$ 0.10
3 years ago

I really appreciate this feedback, thanks.

The vision has a certain level of complexity. I am trying to break it down bit by bit. More content coming soon.

I'm also working on we the BCH Latam team demoing some of what we can do so people can get a more tangible sense of us.

We might also do a kickstarter-like funding campaign.

What do we need? We need funding, we need software developers and strategic partners. We also need lots of eyes on my plans because surely there is room for improvement, things we haven't thought of, etc.

And advice.

Thanks again!

$ 0.00
3 years ago

We need funding, we need software developers and strategic partners. We also need lots of eyes on my plans because surely there is room for improvement, things we haven't thought of, etc.

But what do these people get in return?

$ 0.05
3 years ago

I'm currently debating what to do and seeking advice.

My expertise is Latam, ops, vision, execution, communication. I did do a brief stint as a Chicago investment banker but that was 25 years ago.

The only thing of anything approaching concrete value I see is to issue an SLP token, use it to reward adoption workers (article coming soon on that), get merchants to accept it (not a problem), incentivize remitters with it, and then people who finance us will receive some.

And with all of that, maybe we can get the SLP exchanges to list it, and bootstrap some value.

And should there be profits down the road, we use the dividend calculator to return a percentage.

I can't really promise there will be profits tho I've got my sights dialed in for them very tightly now.

The value we represent is tangible and real. I've spent 2 years of my life on this full-time ++, researching, experimenting, measuring, comparing, and as far as developing world adoption, I am not yet seeing a better plan.

And I'm not greedy. If someone wants to come on, become a partner and play a key role, that is wholly possible.

I never got into crypto to make myself rich.

$ 0.00
3 years ago

Yeah, what I mean is that it should be clear why these people should be doing something. For money, for fame, to help fellow human beings, etc... I'm not saying this should be to get rich, but people need a reason to join.

$ 0.05
3 years ago

I am aim to produce a profit, so there is that.

I'm thinking about how people could pimp their support for adoption teams. Maybe a unique token they can show off on their profiles.

$ 0.00
3 years ago

I for one is amenable with this. Last week, I have distributed leaflets and have received positive feedbacks to some of them, they even shared their ideas on how to make this Bitcoin Cash adoption in my town become successful. I have added my contact information in the leaflet, yet none have contacted me and some are hesitating to accept bitcoin cash as payment for their products (which I understand) because there were very little people using Bitcoin cash here.

To make our dreams possible in making merchants adopt Bitcoin Cash, we should first focus on customers. They are the most important tool here. That is why I decided to talk to barangay officials (head of the Barangay) to organise a talk. It will focus on what opportunities Bitcoin Cash could give and how it should be used. But somehow the problem is that (which you are emphasizing) not most of the people use Bitcoin Cash to spend it for food or clothes or anything. This one really needs attention. But I know, if we continue teaching people to use this to buy things. More merchants will be encouraged to adopt bch too.

$ 0.05
3 years ago

Top remittance-receiving countries:

  1. India (82.2 billion)


  1. the Philippines (35.1 billion)

This topic is extremely relevant to you.

$ 0.10
3 years ago

Yeah, I also agree. That is why I have mentioned in my last article how it will benefit the people in my country here. Especially for those who have families working abroad (OFW or Overseas Filipino Workers) that sends money from where they work to here in the Philippines.

$ 0.10
3 years ago