Opinion – It’s time to pay with crypto
By Phillip Lord, President, Oobit
If you conducted a survey today at any crypto conference and asked the crowd, “Who among you trades with cryptocurrencies” most people would likely raise their hands.
But if you ask the same group, “And who pays with crypto?” you’ll likely see most hands go back down. This raises the question of why even daily crypto users pay with fiat while Bitcoin and other cryptocurrencies remain trading commodities.
Although the adoption of paying with crypto started before the pandemic, with a few supermarkets and coffee shops starting to accept crypto, the everyday user is yet to embrace digital assets as a form of payment. But this should not be confused with an aversion to progression in payment technology, as the use of Apple Pay and Samsung Pay has spread globally. Countries like China have begun moving towards a completely cashless society as early as 2022.
So why the delay in adopting cryptocurrencies and digital assets as a payment method?
The advantages of using crypto to transact are obvious – efficient payment rails, enhanced security through blockchain and, most importantly, total control over your funds. The issues arise when looking at how governments approach adopting digital assets. Look towards the West, and you see a sense of hostility towards this evolving ecosystem, with major Web3 companies moving out of the region. But look towards the East, and regulations are being created to grow the adoption of this industry every day.
Global Adoption Requires Global Coordination
The issue of adoption comes down to the varying regulatory standards that the industry is facing around the globe. Conflicting opinions on how digital assets are classified, stored, and used are suppressing the ability to effectively integrate this revolutionary tech into everyday use cases. To combat this, regulators across different regions must create standardized and globally recognized protocols that safeguard consumers who choose digital assets as their transaction method.
As regulators move from hostility to adoption, the next step would be investing in and developing secure and reliable forms for consumers to use cryptocurrencies the same way fiat is. This could come in the form of working with institutions like banks to set deposit token technology in place, using wholesale CBDC technology to smoothen monetary flow among governments and banks, or working with the growing number of fintech companies that are developing reliable and easy-to-adopt methods of paying with crypto.
Addressing The Crypto Concern
The questions about the volatility of cryptocurrencies are understandable. Governments want to ensure that the public is adequately protected when entering new and untested markets. Past events have proven that regardless of how big or well-known the company is, things can go wrong.
But does this mean that digital assets should be met with hostility?
The argument could be made that there would be no advancement if you approach every new piece of technology or advancement with aggressiveness instead of openness. Regulators should be working to enable progress and provide users with the safest way to access these assets, much like the moves currently seen in places like Hong Kong or Singapore. Through awareness and education, cryptocurrencies could be leveraged to completely change how everyday users transact and even significantly improve the financial states of many regions suffering from faltering economic systems.
It’s Time to Pay With Crypto
The good news is, despite the divide seen in the regulatory landscape today, the development of digital assets has continued. The number of cryptocurrency holders has consistently risen over the past few years, and considerable adoption is still taking place, especially in Asian regions.
For example, The Luckin Café franchise in China has accepted digital payments since it was founded in 2017. Even though the company adopted a very forward-thinking approach to payments, it now operates over 10,000 coffee stores across China. Cafes, pizzerias and even luxury hotels, like the Palazzo Versace in Dubai, have been accepting cryptocurrencies for some time now.
As the space develops, it becomes evident that digital assets as a form of payment are the natural next step in the fintech and payments industry. As regulators work to build reliable infrastructure to provide users with safe and secure access to cryptocurrencies, a little bit of innovation and imagination will be required to bridge the gap between cryptocurrencies and traditional industries. ***