Mycelium has announced the launch of a new merchant processor, Mycelium Gear. Merchants can now receive payments directly into a Mycelium or Electrum wallet free of charge by installing a payment widget on their website or by integrating its open-source API into their backend.
In Friday’s announcement on r/Bitcoin, Mycelium Community Manager Dmitry Murashchik states, “Mycelium Gear is a merchant processor which demonstrates something that has never been possible before Bitcoin: the ability for merchants to use a full featured merchant processor to receive payments online, and have the money go straight into their own wallets, even if that wallet is running on their own phone in their pocket.”
According to Murashchik, Gear “generates invoices with unique addresses for every customer, automatically calculates the exchange rate, and sends a payment confirmation to the site’s shopping cart software. Basically, instead of coding a basic thing from scratch on your own, you can use advanced shopping cart software that tracks customers, invoices, addresses, revenues, etc., and add this little plugin to it to allow it to process bitcoin transactions too.”
Gear is built on top of the open-source Straight Server payment processor, originally developed by Roman Snitko in 2014. “It turned out [Mycelium] wanted to build the exact same thing and were looking for people capable of doing that,” said Snitko in an email to Bitcoin Magazine. “They liked that the project was open source and already the most important parts were functioning. So we decided to join our forces on this one.”
Straight Server uses the BIP32 protocol to generate a new bitcoin payment address for each customer order. As a result, merchants are able to receive payments directly from customers without Mycelium ever touching the funds. Once the payment is sent, Gear is able to track it through the Bitcoin blockchain. This capability is the pivotal feature of Gear: it is a tool that watches the blockchain and detects new transactions at the addresses associated with its clients.
From there, Gear offers the same features as most other payment processors: webhooks that notify your website of the transaction, automatic currency conversion, and notification of over- and underpayments. A notable exception to this common ground is that Gear bypasses traditional payout structures associated with other payment processors. Funds are transferred instantly and directly into merchant wallets.
In the comments following the original Reddit post, Murashchik points out that it is also possible to integrate Mycelium Gear with a Trezor hardware wallet, with Ledger support “coming soon.” It is also useful for sites that accept donations in bitcoin.
At the moment, prices can be set in USD and EUR. Bitcoin prices are automatically adjusted based on the price of bitcoin at the time of purchase. Gear has plans to introduce fast EUR withdrawals in the EU in the near future.
“What’s important to emphasize is that there are two things to supporting currencies: setting prices and conversion of received funds,” Snitko explains. “The first one is easier and we plan to introduce many different currencies in a relatively short period of time. The second one is more complicated due to all the regulatory problems and also the fact that by design Mycelium Gear doesn’t touch the merchants money and thus has no ability to convert them at this point.”
Mycelium Gear adds to its trustless, hands-off approach to payment processing by eliminating personal information gathering, approvals, and KYC/AML requirements. According to the company website, “Because Gear doesn’t hold or even touch the money, we don’t need to know any intrusive information about the merchants.”
“Mycelium’s hope is that Gear will encourage even more merchants to adopt bitcoin and completely change the way merchant transactions are done,” Murashchik adds, “thus continuing our goal of decentralizing everything, improving privacy, and eliminating unnecessary third parties in the Bitcoin economy.”
In Friday’s announcement on r/Bitcoin , Mycelium Community Manager Dmitry Murashchik states, “Mycelium Gear is a merchant processor which demonstrates something that has never been possible before Bitcoin: the ability […]