We have been selling some of our products on Cryptothrift – an auction site specialised in cryptocoins. You can check our feedback here.
As you may notice, the amount of orders is relatively low compared to sales via our store. It’s because escrow is a required service by Cryptothrift and we don’t prefer this method.
So why doesn’t Coaex prefer escrow service?
When dealing with escrow, we should wait the payment to be released at least a week, given the delivery time to our customers. During that time, it is likely the price of cryptocoins and precious metals change. This may lead to a loss or a profit for both merchant and customer perspective. For small orders, we can compensate these losses considering it as a marketing effort but for large orders, these losses may lead our business deteriorate. Therefore, to avoid this possible problem, our first preference is instant payments via our store. We hope that you understand our concerns in this regard.
Below you can find a case scenario where we may encounter a loss.
1) Buyer places an order on 15.02.2013 which has a total of 50 USD where the price of Bitcoin is 550 USD.
2) According to the conversion rate on the purchase date, the seller will recieve 0,909 BTC.
3) The delivery takes 10 days and the price of Bitcoin drops to 450 USD on 25.02.2013.
4) Buyer releases the escrow on 25.02.2013 and seller get 40.90 USD (9,10 USD loss from the sale price) according to the conversion rate.
A similar scenario might be beneficial for the merchant if the price of the relevant coin rises through the escrow release date but we offer discounts and cashbacks to our customers if we believe we profit much. Ensuring fair trade and customer satisfaction is more important than our profit.