August 17, 2013 01:18 am GMT

Adding Bitcoin Payment Processing to Your Website

Bitcoin has definitely started to become more mainstream, and with its global reach and minimal fees, it is a payment method worth considering.

In this article, we will take a look at what Bitcoin is, as well as how to start accepting them in your applications.

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What Is Bitcoin?

First things first, what is Bitcoin? For the un-familiar, Bitcoin is a peer-to-peer currency, developed to remove the need for a third party trusted authority, and instead rely on intrinsic security by means of cryptographic hashes.

By removing a central authority (A government, bank, etc..) you reduce fees and lower requirements. There is no need to fill out forms or pay people's salaries, so in a sense, the money secures itself.

I'm not going to get into the specifics, but essentially each time a transfer of currency takes place, the money is signed with the two parties keys and then hashed, and these transactions are appended to the global log. This allows coins to be publicly traced back, and to see if the money really belongs to someone or not.

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Advantages & Disadvantages

Now let's take a look at some of the advantages and disadvantages associated with using Bitcoin:

Advantages:

• Anyone can use it globally.
• Somewhat anonymous.
• Minimal fees.
• No setup required.

Disadvantages:

• The worth of the coins fluctuates.
• Not as mainstream as other options (CC, Paypal).

The advantages all follow a similar pattern, in that because there is no central authority, anyone can use it at any time without needing any confirmations or acceptance, plus the fees are pretty low.

Now the disadvantages are varied. Since it is not as mainstream as other payment options, I don't think it is quite where it needs to be, in order to make it your only payment option. But by all means, if you are a huge supporter and want this to grow, you can be a Bitcoin-only service, but I would suggest, for now, using it alongside another service, which accepts credit card.

The other disadvantage is the stability of Bitcoin's value; at the beginning of this year, the worth of one bitcoin was around 12-14$ each, in just a couple of months the coins went up to almost 240$ in April and are currently worth around 110-115$ each. This is in huge contrast to traditional currencies, for your money to have a 2000% increase in worth and then a 50% decrease, all within a few months seems like it should be a red flag.

courtesy of blockchain.info

It's hard to say for sure, if this is just a bi-product of having a decentralized currency, or if it is due to the infancy of the program, but it is definitely a concern.

Luckily most Bitcoin processors, like the one I will be using in this article, allows you to instantly convert the Bitcoins or a portion of them into regular currency, like dollars, right away. You can for instance setup that 80% of the Bitcoins that come in should be immediately converted and transferred to your bank account, removing this risk element.

Ultimately, you can both gain and lose from these fluctuations, so it's up to you to decide whether you want to gamble and leave more of it in Bitcoins, or remove all the risk and convert all of it.

Their are a couple popular services around that work like Coinbase, BitPay, etc. but the one I will be using in this article is BIPS.

The Premise

In this article we will be building a simple landing page, where you can enter in your email and click 'purchase' which will take you to the payment page. On the payment page, you will be given a Bitcoin wallet address which you can send the money to, and once you pay, you will receive the item you purchased via email.

These three stages are completely separate, as in all payment options, but it stands out more here, since you can't pay directly from the purchase form and need to pay from your own personal Bitcoin wallet.

For this app, I will be using Slim to provide a little structure, Mandrill for sending the product and, like I mentioned, BIPS as the payment processor to implement the Bitcoin side of things.

The Setup

So to install Slim, create a composer.json file with the following:

{   "name": "bitcoin app",   "require": {       "slim/slim": "2.2.0"   }} 

Then run composer install (assuming you have composer installed) to install the dependencies.

Next, create a public folder with an index.php file inside of it, and a views folder.

Your structure should look something like this:

public/    -> index.phpvendor/views/  composer.json

Now open the index.php file and let's setup the Slim app:

<?php   require "../vendor/autoload.php";   $app = new \Slim\Slim(array(       "templates.path" => "../views"   ));

We are requiring the autoloader, and then instantiating the Slim library, so far just boilerplate. Next, let's add the home route which will be a standard HTML page with the form to start a purchase:

$app->get('/', function() use ($app) {   $app->render('home.php');}); 

And then we need to add the home.php view file itself to the views folder:

<!DOCTYPE HTML><html><head>    <title>Bitcoin App</title>    <style>        body {            font-size: 1.6em;            text-align: center;            padding: 130px;            font-family: sans-serif;        }    </style></head><body>    <h1>Buy This</h1>    <p>This is a great offer you should purchase this thing</p>    <form action="/" method="POST">        <input type="text" placeholder="Enter your E-mail" name="email"/>        <input type="submit" value="Purchase !">    </form></body></html>

Nothing too fancy, basically just a form to submit the user's email.

The last piece of setup we need to complete is to sign up for both BIPS and Mandrill (if you are using it) and generate API keys for both. In BIPS, you go to the Merchant tab and generate an invoice API key, and for Mandrill you go to the SMTP & API Credentials page to generate a new API key.

Creating an Invoice

So far we have a basic form which will submit a user's email via a POST request, the next step is to take that email and generate an invoice for it.

Let's add a post route to the index.php file, which will generate an API call to create a new invoice and redirect the user to it:

$app->post('/', function () use ($app) {    $email = $req = $app->request()->post('email');        if ($email) {        $token = "BIPS_API_KEY";                $ch = curl_init("https://bips.me/api/v1/invoice");        curl_setopt($ch, CURLOPT_POST, true);        curl_setopt($ch, CURLOPT_RETURNTRANSFER, 1);        curl_setopt($ch, CURLOPT_HTTPAUTH, CURLAUTH_BASIC);        curl_setopt($ch, CURLOPT_USERPWD, $token . ":");        curl_setopt($ch, CURLOPT_SSLVERSION,3);        curl_setopt($ch, CURLOPT_SSL_VERIFYPEER, FALSE);        curl_setopt($ch, CURLOPT_SSL_VERIFYHOST, 2);        curl_setopt($ch, CURLOPT_POSTFIELDS, array(            "price" => 20,            "currency" => "USD",            "item" => "PDF Book",            "custom" => json_encode(array(                "users_email" => $email            ))        ));        $invoiceUrl = curl_exec($ch);        $app->redirect($invoiceUrl);    }}); 

There are a couple of things to notice here, for one, the API token you generated for creating invoices, is the 'username' in the HTTP authentication. The POST fields we are sending are as follows:

• price – the price of the object (an int or float value).
• currency – a currency abbreviation like USD, GBP, EUR or BTC for prices in Bitcoin itself.
• item – the item's name, this is optional but it will show up on the invoice.
• custom – a JSON encoded string containing any custom data you want attached to the invoice. Whatever gets specified here will be passed back once the user pays, so you can put internal reference numbers or keys to a database, in our example I just put the email in since we aren't storing any other data.

The API call will return just the URL to the invoice itself, so we can just get the response and redirect straight to it.