How Ride-hailing Industry is Affected by Bitcoin in Russia?
The largest ride-sharing company in Russia, Yandex. This news follows Uber’s recent decision to leave the market and accept cryptocurrencies for payments. Check the tips to maximize Bitcoin returns .
6 Positives of Bitcoin that can Benefit the Ride-hailing Industry in Russia.
- It is more transparent for both customers and drivers when it comes to fees
There are zero charges for payments with bitcoin. This means that the customer only pays for the exact amount of money they spent on their ride, without hidden costs or additional taxes.
Also, compare Uber’s service fee in Russia (25%) to Yandex’s. Taxi (20%), it becomes apparent that there is more money for the driver if he accepts payments in cryptocurrency.
Moreover, fees paid by drivers are also much lower than those imposed on Uber’s transactions by payment providers like Visa and MasterCard. This gives Russian ride-sharing companies a better opportunity to increase their earnings, though the figures are still small.
2 . It is an easy way to pay for goods and services for international travelers.
Bitcoin has a higher global adoption rate than any other cryptocurrency, which means that you can use it as your daily payment method in many countries, including Russia.
If you are using bitcoin, there are no risks involved when transferring funds internationally, as you only pay the exact amount of money for your ride. There are also no hidden charges or exchange rates to think about.
3 . It provides quick transactions and is more secure than cash
There is no need to wait for a bank transfer to go through before completing your transaction. Once the driver has received the payment, he can go on with his day or night. Also, paying with cash always involves risks to both parties.
The absence of this risk is yet another benefit of using cryptocurrencies as your preferred payment method.
4 . It doesn’t depend on local currency
The country’s economic situation does not determine the value of cryptocurrency. For example, if you pay for your ride in US dollars, there is a significant chance that your local value will be different from what it was worth earlier on the day.
This is because bitcoin transactions are processed 24/7, so they always have their actual market value at all times during the day.
- You can build your business faster
Settlement systems, such as banks and payment providers, often require a lot of time to process transactions.
In many cases, they also have strict transfer limits. When using cryptocurrencies, transferring funds from one account to another is instant. This gives the customer more control over their money and makes it easier for drivers to keep track of their payments.
- It has the potential to be utilized as an advertising strategy.
Cryptocurrencies are becoming more popular by the day, so it is possible to attract more customers simply by accepting them as rides payments.
3 Negatives of Bitcoin that can Affect the Ride-hailing Industry of Russia.
- Lack of regulation
Bitcoin falls under the list of “decentralized” cryptocurrencies, which means any country or state authority doesn’t control it. The absence of a regulator makes the industry more vulnerable to market fluctuations, leading to significant losses for businesses that accept bitcoin as a form of payment.
For example, when the value of bitcoin dropped by 11% in 2018, dozens of people went online to complain about their problems when dealing with this form of payment.
- High volatility
The ride-sharing industry requires a stable and predictable currency that can be used for transfers and transactions without high fluctuations in its exchange rate. Unfortunately, cryptocurrencies like Bitcoin do not fit this description, making them unsuitable for buying and selling goods. Another problem with bitcoin is that the next prominent cryptocurrency could overtake it before you have a chance to spend your funds.
Despite the benefits that cryptocurrencies offer to businesses, they are not yet suitable for use by ride-sharing companies. In addition, the unstable exchange rate of bitcoin makes it unsuitable as a consistent payment method, especially since you are unlikely to receive the agreed amount of money at the transaction time.
Also, there is no regulated cryptocurrency market out there that could allow you to find exchanges for your cryptocurrency quickly.