Bitcoin is a cryptocurrency that operates on a decentralized peer to peer network. No single institution controls the Bitcoin network. No entity or government prints new Bitcoins like dollars and euros as they are produced by people and businesses using computers and software around the globe to “mine” new Bitcoin. Ticket Sales operations and professionals such as Ticket Brokers sell tickets. A very high percentage of ticket sales occur online and Bitcoin is an electronic form of money easily transmitted from one entity to another via the internet and Blockchain. Perhaps there is merit in analyzing how Bitcoin could fit into the market for both primary ticket sales and the secondary ticket market.
Ticket Brokers are very familiar with merchant processing fees, fraud protection issues and costs, and chargebacks. Bitcoin may offer brokers and other organizations processing payments appeal in terms of merchant processing fees. Companies providing payment processing services with Bitcoin are in some cases offering the service without any fee for certain transaction volume and in other cases fees no higher than 1%. This compares very favorably with merchant processing fees that can approach 3.5% for some transactions using credit and debit cards.
Studies have shown that fraud costs businesses about $2.70 for every dollar of fraud that occurs. Fraud related to purchases made from other countries can occur at a rate four times the rate of domestically based fraud. There is no need for identity verification when using Bitcoin and thus no risk of compromising customer data. Bitcoin also works internationally without the need to transact directly with multiple currencies which also reduces fraud exposure.
Chargebacks are a major headache for businesses and can lead to fines and other fees if chargebacks rise above certain levels as a percentage of total transactions. A chargeback occurs when a consumer goes through their bank or credit card provider to force a refund. This occurs in a fraudulent manner or perhaps due to indecision, but either way it is a major cost and hassle. Bitcoin transactions are “pushed” only in one direction. Once a customer “pushes” the Bitcoin to a business there is no way for any entity to “pull” funds back from the seller, in this case a ticket broker.
Since launching in 2009 Bitcoin appeared in the headlines for a variety of reasons and continues to plug away with an emerging ecosystem supporting it. However, there is still the chicken and the egg dilemma. Even if Bitcoin might make a lot of sense in terms of using it to collect payments, how many consumers in the market for tickets want to use Bitcoin to purchase tickets? Only time will tell the answer to that question.