Cryptocurrency is fast gaining mainstream acceptance as consumers look for innovative ways to diversify their savings, protect against inflation, and save on transaction fees.
Big-name brands are taking note: PayPal, Starbucks, AT&T, AMC Theatres, Microsoft, and Whole Foods are among a growing battalion of organizations that now accept payment in cryptocurrencies. In fact, nearly 16,000 venues around the world accept cryptocurrency payments, according to Coinmap.org. And the cryptocurrency market is expected to grow from $1.6 billion in 2021 to $2.2 billion by 2026, according to a report published by MarketsandMarkets.
At the same time, cryptocurrency presents an opportunity for companies to create new and innovative offerings around these digital assets. Examples range from mobile apps that allow consumers to get started with cryptocurrency quickly and easily to platforms that automate bitcoin purchasing for fledgling investors.
But while staking a claim in today’s cryptocurrency market can drive customer engagement and competitive wins, the right set of tools and talent are required to hurdle obstacles that include consumer fears, technology headaches, and compliance concerns.
Crypto market demand
Consumer demand isn’t the only driver of enterprise cryptocurrency adoptions. Digital assets such as bitcoin, ethereum, solana, and avalanche, are based on a distributed ledger called blockchain. This decentralized approach means data is stored in an individual’s crypto wallet rather than in a centralized depository where data breaches can occur.
A blockchain general ledger is used to verify and record every transaction, making cryptocurrency transactions not only more secure than credit and debit card payments, but faster by eliminating the need for time-consuming third-party verification. “We’ve seen increasing demand from merchants—from supermarkets to fast-food chains—that want to accept crypto because it truly is a win-win for consumers and merchants,” says Sara Xi, chief product officer at Prime Trust, a fintech infrastructure provider with API crypto integration.
Lower transaction fees are another advantage of cryptocurrencies. “Crypto really needs to be adopted just like any other fiat payment rail. When consumers pay for stuff, they can simply pay with crypto and bypass conversion to a fiat currency as an intermediary,” says Xi. “Credit card processing fees will be irrelevant for merchants or consumers.”
In addition to cost savings, cryptocurrency is enabling businesses to access new target demographics. Take, for example, The Pavilions Hotels & Resorts group, a Hong Kong-based hospitality group. The Pavilions is one of the first international hotel chains to embrace digital currency payments. Customers can book rooms in many of the hotel chain’s global destinations, based on the currency and location they are situated in at the time of booking, using bitcoin, ethereum, or 40 other digital currencies.
According to Scot Toon, managing director of the Asia region of The Pavilions Hotels & Resorts, accepting cryptocurrency payments has helped The Pavilions Hotel Group to nurture lucrative crossover markets, such as luxury travelers who also happen to trade in cryptocurrency.
Joseph Lupo agrees. Lupo is a general manager with CoinBits, which helps businesses and investors securely build, manage, and protect their money in a private bitcoin portfolio. “We saw a demand for higher net-worth individuals and businesses who want to invest in this new asset class,” says Lupo. “They need an on-ramp and someone they can trust since bitcoin doesn’t have a team or headquarters, so we started Coinbits Reserve to help businesses and higher net worth individuals invest in bitcoin. We manage their investments but also focus on education and what this new
By: MIT Technology Review Insights
Title: Cryptocurrency fuels new business opportunities
Sourced From: www.technologyreview.com/2022/06/08/1053056/cryptocurrency-fuels-new-business-opportunities/
Published Date: Wed, 08 Jun 2022 14:00:00 +0000
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