REAL CLEAR CRYPTO: Solana, USDC, and Modern E-Commerce


By Evan LaMontagne, Analyst Sarson Funds, Inc

The Dawn of a New Digital Commerce Era

The landscape of the digital economy is constantly changing. The days when cryptocurrency discussions were limited to niche tech enthusiasts and libertarians are gone. Today, digital currencies are steadily integrating into our everyday purchases and commerce. This is evident from the introduction of USDC payments on Shopify through Solana Pay, and the collaboration between Visa and Solana for a USDC-based settlement pilot program. Such advancements have profound implications for users, merchants, and the overarching financial environment.

Deciphering the Terminology

USDC (Circle’s USD Coin): A stablecoin that is pegged to the value of the US dollar, offering stability against the volatile nature of other cryptocurrencies.

Solana Pay: A system built on the Solana blockchain, initially designed for physical point-of-sale transactions but has since evolved for online vendors. Solana’s blockchain is the perfect solution for this because of its speed, scalability, and cost-effectiveness.

Shopify: A major e-commerce platform, accounting for a significant chunk of global e-commerce activity.

Visa’s Involvement: Originally, Visa explored stablecoin settlements using Ethereum’s USDC, providing Australians with more efficient cross-border transaction opportunities in conjunction with Now, they’re leveraging Solana’s fast blockchain technology to further enhance this system.

Perks for the Everyday Consumer

Universal Access: Cryptocurrencies, especially stable ones like USDC, offer a global reach with the stability of the US dollar This is invaluable for individuals in regions with unstable banking systems or fiat currencies.

Cost-Efficiency: Solana’s negligible transaction fees mean more savings for the user, especially when weighed against traditional banking and cross-border transaction costs.

Merchants and Processors Stand to Gain

Broader Audience: Embracing USDC payments allows businesses to attract a wider audience, both domestically and internationally, while needing fewer intermediaries.

Swift Transactions: Solana ensures rapid global settlements, bolstering cash flow and reducing transaction times significantly.

Lesser Fees: Merchants often face fees from traditional payment providers such as credit card fees, and cross-border wire fees. Solana’s minimal fee structure can help businesses increase profit margins while offering this additional innovative payment option with minimal startup costs.

Challenges Still Exist: While the benefits are immense, there’s no denying potential hiccups. The volatile nature of the broader crypto world and regulatory uncertainties are genuine concerns. Merchants must be well-versed in managing their assets and navigating potential regulatory challenges. Platforms like Shopify could begin to offer guidance, but businesses ultimately bear the responsibility.

Redefining E-Commerce

This evolution is about more than just a few key players. The larger e-commerce platforms are realizing the undeniable advantages of integrating cryptocurrency payment rails. It’s a nod towards preparing for the future where digital payments might begin to capture market share of traditional methods, like credit card transactions.

Envisioning the Future of Online Purchases

USDC payments on Shopify via Solana Pay are a testament to the shifting paradigms in our financial systems. They signify a move towards a decentralized, user-friendly, and an inclusive financial future. While the road might still have its obstacles, the horizon for crypto in e-commerce seems promising. It points to a future where our online shopping experiences are enhanced by blockchain technology.

Further Exploration

Dive into how Solana Pay’s USDC integrates with Shopify [here].

Learn more about Visa’s innovative USDC Solana Pilot Program [here].

Disclosures: Not investment advice. Talk with your financial advisor before making any investment decisions or have them contact Sarson Funds directly at [email protected]