January, 2023
To become more familiar with cryptocurrency and its benefits, we added cryptocurrency payments to the Croma Vera website. This article summarizes the key technologies used and our experience.
Was it hard? No.
Our experience setting up crypto to purchase wine online required two distinct sets of skills: Someone familiar with corporate compliance to create the multiple accounts required to process crypto and someone comfortable with using technology to configure the website. Notably, setting up crypto payments required zero programming expertise, just general familiarity with how a website is developed.
Technology
A cryptocurrency (shortened to crypto) is a digital currency that doesn’t rely on any central authority, such as a government or bank, to uphold or maintain it. The most common forms of crypto for payments are Bitcoin and Ethereum.
Croma Vera uses Shopify website management software to manage our website. Shopify is a platform that allows businesses to create and manage their online store, including all the necessary features like adding products, processing payments, and tracking orders. Croma Vera adopted Shopify to power our website and online store at the start of the pandemic, and we haven’t looked back.
Coinbase is a digital currency exchange, which means it's a platform that allows people to buy, sell, and store different types of crypto, like Bitcoin and Ethereum, which are the two cryptocurrencies Croma Vera currently accepts.
To accept crypto, we connect our Shopify website management software to Coinbase using additional software (called a plugin) to the Shopify website.
The Shopify platform enables the store management and the checkout process, while Coinbase enables the actual crypto payment and, optionally, the conversion process to exchange cryptocurrency into US dollars.
Connecting Shopify and Coinbase
If you are already using Shopify, setting up crypto payments requires four steps.
1. Create a Coinbase Commerce account: Creating the initial Coinbase Business account was painless and took about 10 minutes.
2. Provide documentation: We were required to prove the identity of the owners of the company and that the company was properly registered in the U.S. This process required two interactions with the Coinbase team over three days.
3. Complete the Coinbase setup: Once the Coinbase account is approved, provide additional information about the business, including linking a bank account.
4. Install and configure the Shopify Coinbase Commerce plugin: This was the simplest part, completed in 4-5 clicks within the Shopify website administration interface. When completed, Shopify displays the option to pay with crypto during the website checkout process.
Lessons Learned
Setting up crypto payments on our Shopify website was surprisingly straightforward and did not require any programming. Kudos to Shopify and Coinbase for making this work so well.
Online credit card processors, such as Stripe, which we use to process online credit card orders, often make alcohol producers jump through several more administrative hurdles than a regular small business. Coinbase had no additional requirements for an alcohol-related business, so setting up this account was in several respects, easier.
We are not anticipating much in the way of crypto sales, but setting up crypto payments was a worthwhile experiment to become more conversant with the technology so that we can monitor future evolution in the crypto community.
The Future of Crypto and the Wine Industry
While it’s difficult to predict the future of cryptocurrency and the wine industry, the use of cryptocurrency in the wine industry will likely increase in the coming years. These three areas seem to be the most likely.
First, like Croma Vera, we already see many wineries experimenting with crypto payments. If the adoption of crypto continues to grow over time, it’s likely more merchants will come to accept crypto payments.
Second, Non-Fungible tokens (NFTs) are a type of digital asset representing ownership of a unique item or piece of content, such as digital artwork, a collectible, or virtual real estate. These assets are recorded on a blockchain, a digital ledger that records transactions securely and transparently. Some wineries are creating NFTs that are linked to their wine brand or that provide access to wine not available to the public.
Finally, blockchain technology forms the foundation of many cryptocurrencies and NFTs and offers a transparent and secure way for wine producers and merchants to trace the origin and authenticity of wines, potentially reducing fraud and increasing consumer trust. For example, the ownership of a premium bottle of wine over time could be recorded and publicly verified at the time of purchase.