If you’re still wondering where we’ve reached with the convergence of fashion and technology, then there’s a lot of catching up to do. There is no denying that the lines between the two have started to blur and is reflected in multiple trends such as 3D printing, artificial intelligence, robots, virtual realities and now cryptocurrencies.
One of the latest, most talked about and equally confusing development has been the Bitcoin technology. Before we understand the massive impact this concept can have on the fashion industry, it’s imperative we break it down into simpler terms and gauge its influence on currency transactions in general.
What is Bitcoin? Is it the future of currency transactions? Is it currency at all?
Bitcoin is a digital currency invented by Satoshi Nakamoto in 2008, but made public only in 2009. It is used to make payments of any value, without having to pay fees for it. It works on a public ledger known as blockchain that carries a decentralized record of all the transactions made and held by the users of the network. Unlike other paper currencies, bitcoins can only be mined, and not minted. Only 21 million bitcoins have been created to date.
How is this technology relevant to the fashion industry?
Bitcoin, or other cryptocurrencies, carry the potential to revolutionize the way payments are made in the retail industry. People are increasingly adopting it and finding places to spend their bitcoins. How safe or unsafe it is, is where the concern really lies. Regardless of what many might say, the rise of bitcoin technology is inevitable and cannot be ignored.
It is taking over the digital marketplace and many retail giants including Amazon, Dell, Microsoft and Subway have already adapted to this cryptocurrency technology to appeal to a larger audience and it is only a matter of time before the others also take the plunge and start accepting bitcoins as a new form of payment.
However, this does not rule out the unpredictability, uncertainty and risks that come with this virtual asset. The primary reason why retailers are accepting this form of currency today is because it eliminates the processing fees that are associated with the transaction and merchants can, in turn, rake better profit margins.
Another advantage of using the bitcoin technology is to battle counterfeiting. Unique microchips using this technology when fitted in each product can tell for certain if the product is original or imitated. Counterfeiting affects brands and consumers alike. This technology will be able to gauge the authenticity of products, tell brand and product stories and communicate with consumers who are shopping for similar items in the proximity.
With bitcoin setting its foot slowly but firmly into the market, people will now be able to transfer money internationally with utmost ease and safety without worrying about any monetary limitations and having to pay extra fees for such transactions. In a way, this is a blessing in disguise for the fashion and luxury sector, as money would now be easily transferable and individuals would be at the liberty to spend more.
Cryptocurrencies, primarily bitcoins, entered India much later but peaked in the last year and a half, thanks to demonetization and the urgency to understand the importance of a digital economy. In a cash-first country like India, it would’ve been difficult to imagine the extra nudge towards digital dependency. India’s added interest in this technology also suggests the government’s push towards a cashless economy in order to combat black money, making it more validated. The incessant increase in the value of bitcoin has also let to excessive traffic on India’s leading bitcoin company Unocoin, after demonetization. However, the Reserve Bank of India still cautions users of virtual currencies like bitcoins.
The possibilities of fashion technology in India are no longer overwhelming and unimaginable. Besides everything else that we have achieved by bridging fashion and technology, the influence of cryptocurrencies on retail is also on the rise. As on July 2017, Cyankart India Pvt. Ltd announced the inclusion of bitcoins as a legitimate payment method, making it India’s first fashion and lifestyle store to do so. Another way people are converting their bitcoins into fashion are by platforms like Bitfash that helps spend bitcoins on apparel from premium brands such as Zara and Forever 21.
Bitcoin is slowly becoming the next big thing in investment, however, the level of risk involved is still uncertain. The accelerated momentum behind this technology has made it a hot commodity now, one that people would at least be fascinated to learn about, if not actively participate in. It is making the fashion industry more susceptible to bigger risks, and at the same time, positioning it to a global, more advanced market. Fashion has a lot to benefit from the bitcoin technology, if adopted with utmost transparency and accountability.