LockTrip Launches Credit Card Payments Support!
We are very excited to announce that LockTrip is the first company in the world to offer real-time credit card payment support for its unique travel service.
You can now use your debit or credit card to book any of the hotels we are offering on our marketplace.
In this article we want to provide more info about this feature.
Opening up the mass market
For a business, it is very important to focus on usability and to make processes as simple as possible. This essentially is a requirement for high conversion rates and quick adoption. Any business that disregards this key factor will quickly feel the hampering effects of the usability barriers they have not taken care of.
Dealing with technical tasks such as setting up a blockchain wallet is a no-go for most of the people around the world. This is why the fiat payment feature was at the core of our project from the beginning.
With this new feature, booking a hotel will become as easy as on any other booking website. If you can make a credit card payment, you can book on our marketplace.
The role of LOC in this process
Some might think that booking with fiat will reduce the demand for LOC. In fact, the contrary is true.
If you book a stay for $500 and pay with credit card, this $500 will automatically execute a “buy LOC” order on exchanges and thus buy the equivalent amount of LOC. Upon buying, those LOCs will be sent to the same booking smart contract we are using for other payment methods.
They will stay there until you checkout from the hotel, thus making the smart contract an “escrow account” for your payment. This means that for the period between booking and checkout, the LOCs in smart contract are taken out of circulation, reducing the supply on exchanges and putting upwards pressure on the price.
The more bookings are stored in the smart contract simultaneously, the more LOCs will be out of circulation!
So regardless of your payment method, you are always paying with LOC when booking something on our marketplace. The only difference is that you do it either directly by using the LOC payment method, or indirectly as a background process.
Below, you can see an example of how you can choose between different payment options.
If you want to pay with LOC, the price is fixed in fiat and dynamically converted into LOC every 10 seconds (see the countdown). The LOC price is calculated by fetching real time order books across multiple trading pairs on exchanges. The best price will automatically be determined and presented to the customer, which can also include a mixed buy order from two or more trading pairs. This makes the system immune against price manipulation happening on a single exchange or trading pair.
If you want to pay with Credit Cards, you are taking advantage of a premium feature and thus have to pay a small fee. The fee might show small variations, but should always be at around 2,5% (depending on the exchange availability).
In the example above, you can see that this is reflected in a price difference of approximately 2% ($180 vs $176) between LOC payment and fiat payment. This difference (fee) results from the following factors:
- Fee from the third party payment provider
- Exchange fees from fiat to ETH (or BTC) conversion
- Exchange fees from ETH (or BTC) to LOC conversion
- Transaction fees on the blockchain
- Small commission to cover the operational costs of LockTrip
The combination of those factors results in a dynamic fee that can slightly differ for each price update happening once every 10 seconds. Our algorithm is designed to minimize the combined effect and reduce fee volatility by intelligently calculating slippage effects in advance.
The payment mechanism itself is made up of 13 separate elements that are all interconnected to ensure a smooth experience.
We believe that this new technology is very unique in the blockchain industry and will push us significantly ahead when it comes to real world adoption. So far, there are very few projects that took the step to reach beyond the blockchain community. For us, this feature embodies a central element of our expansion strategy.
Payment options to be added soon
While you are currently able to pay with debit and credit cards only, we will also add support for local payment methods such as Sofort and other alternatives such as PayPal or Skrill.
In total, you will be able to use more than 150 different payment methods around the globe.
We will gradually add more and more of those options to further improve accessibility and ease of use.
Not only that, but we will also integrate payment with Bitcoin or Ethereum, which should open up a completely new customer base.
Together with the integration of 300,000 additional hotels and the launch of flight tickets until the end of this year, our marketplace is quickly becoming a very competitive place for travel related services.
During the last few months we have observed a steady rise in booking rates. With this new integration, we expect the booking rates to get another boost as our community is ready to spread the word to their friends and family.
More importantly, there is number of business travelers who were waiting for this feature in order to promote it across their networks and businesses.
To get an idea of how booking rates are linked to the LOC economy, we recommend to go over this article.
Stay tuned for more updates and thank you for your patience!
LockTrip is the first marketplace with 0% commission where you can save on average 20% on your hotel and rental bookings compared to anywhere else. Learn how to buy LOC tokens to enable access to our marketplace and its lower prices here!