I’m not promoting Paypal, just hazarding a prediction. Many retail shops in Melbourne have signed up to accept payment from walk-in customers with Paypal accounts via its smartphone ‘wallet’ app. The ease of implementation and use, relatively low merchant fees and the high public take-up of Paypal are compelling retailers to sign up. I reckon it will catch on so well that I will soon be able to leave my credit card at home, and just take my mobile to pay for stuff.
But there is a catch: the merchant knows who you are. They can charm you by addressing you by name at the checkout. If they are motivated, they can instigate loyalty based advertising based on your patterns of activity with the shop. This is the secret weapon for Paypal, who will charge merchants for that information.
On the other hand, cryptocurrencies like Bitcoin offer the same anonymity in the transaction as cash. So the café you visited last week won’t be profiling you and sending you a follow-up email with a discount offer to entice you back. I’m getting sick of all that from the supermarkets and online retailers.
Unfortunately, only a handful of shops in Melbourne have taken up Bitcoin. This is despite the absence of fees on retail transactions—fees are only charged by exchanges for conversion to and from national currencies. There is no central Bitcoin organisation, which sounds great in theory to those of us who deplore the unaccountable power of financial institutions. But nobody is coordinating the promotion of Bitcoin, and the movement is stalled.
This week, the Australian Tax Office echoed the American IRS in its decree that cryptocurrencies are tangible assets but NOT currencies. This may kill the cryptocurrency golden egg goose, as accounting for them becomes a nightmare. Bitcoin may remain in limbo, continuing only as the underground currency for purchasing psychotropic substances online.
And with Paypal here, there and everywhere, we will descend into perpetual ad bombardment hell.
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