- Cryptocurrencies have become increasingly popular for investment and transactions over the last two years.
- Owing to the growing consumer interest in crypto, online merchants and retailers have started accepting payments in bitcoin and other cryptocurrencies.
- Cryptocurrencies rose to fame as a payment method in the retail and tourism sector. Still, will the bearish blues hamper the future?
Over the last couple of years, the cryptocurrency sector has gone from being a speculative asset class to achieving massive mainstream adoption. Cryptocurrencies such as bitcoin (BTC), ether (ETH), Dogecoin (DOGE), and a few others saw a meteoric rise both in terms of retail and institutional adoption.
Investors’ risk appetite rose when the 2020 bull run took off; since then, cryptocurrency payments have also witnessed a sheer rise in number. As cryptocurrencies rose to fame, in 2021 amid high market euphoria, the top cryptocurrency bitcoin made an all-time high of $69,000.
Consequently, over the last two years, cryptocurrencies have become increasingly popular for investment and transactions. In fact, despite the recent long-drawn bearish market, crypto transactions and investments have become a standard part of the finance landscape.
On 14 January this year, Tesla started accepting Dogecoin as a mode of payment on select merchandise. However, it’s not just big institutions or retail that are inclining towards crypto payments; of late, tourism has also been touched by the crypto wave.
Retail x Cryptocurrencies
Cryptocurrencies have gained traction in the financial world in recent years. A growing number of traditional investors have allowed payments in crypto for consumers and clients.
Bitcoin and a few altcoins are becoming widely accepted as consumers, and online stores realize the potential of digital currencies. A report released by Goldman Sachs in January 2022 predicts that the digital economy is an $8 trillion-dollar opportunity.
It’s no wonder that online merchants and retailers have started accepting payments in bitcoin and other cryptocurrencies owing to the growing consumer interest in the space. This also allows these firms to position themselves as developing brands in the blockchain and Web 3.0 space.
Surprisingly, Microsoft was one of the early adopters of bitcoin in 2014 when it began accepting the cryptocurrency as payment to buy games, apps, and other digital content in the Microsoft Store for platforms like Windows Phone and Xbox.
Interestingly, modern digital payments giant PayPal began accepting bitcoin in September 2014 — three months before Microsoft boarded the crypto train.
Additionally, several retailers like Whole Foods, Home Depot, GameStop, Newegg, Starbucks, and AT&T now accept bitcoin and other forms of cryptocurrency in their retail stores.
Recent data shows that, as of 2022, an estimated global crypto ownership rates at an average of 4.2%, with over 320 million crypto users worldwide. Quite a few global brands, institutions, and retailers have now started to accept or are in plans to shift to crypto payments.
Tourism x Cryptocurrencies
While the retail sector often takes the limelight when talking about crypto payments, retailers aren’t the only ones showing interest in the space; Cryptocurrencies, Web 3.0, and blockchain technology now have use cases across industries, including tourism. Not only has the travel industry embraced digital assets, but the intersection of the two sectors has also given rise to a new genre of operations – crypto tourism.
Crypto tourism includes funded or booked trips using cryptocurrencies or going to crypto-friendly destinations. The phenomenon also includes traveling for crypto and blockchain events, seminars, and conferences which have increased significantly over the last few months after the pandemic subsided.
Interestingly, several airlines, tour operators, and travel aggregators have begun accepting crypto payments. Emirates Airlines had announced that it would soon accept bitcoin as a mode of payment. While Latvian carrier and Air Baltic already accept crypto payments.
Latvian airline airBaltic was the world’s first airline to accept bitcoin payments for its flight tickets in 2014. Now the company also accepts ether and Dogecoin. Moreover, airfare websites like Cheapair.com and Travala.com also accept crypto payments. In addition to that, tours and activity booking sites like GetYourGuide have also started accepting payments in Dogecoin.
In fact, nowadays, crypto geeks are traveling to several crypto-friendly tourist destinations where digital payments are widely accepted. Crypto-friendly destinations include places like the Bahamas, which has its own digital currency called the Sand Dollar.
Is the Future Bright?
Looking at the growth of cryptocurrencies as a payment method over the last five years presents optimism for the future. However, the recent bear market blues have significantly affected the sector, bringing the cryptocurrency market cap down to a low of $887.24 billion at press time from a high of nearly $3 trillion last year.
The bearish sentiment and rising interest rates have made investors skeptical of entering risky asset markets. Nonetheless, looking at the long-term growth, it can be said that cryptocurrencies could play a crucial role in shaping the future of payments.