Overstock.com made waves when it became the first major online retailer to accept payment in Bitcoin back in 2014. It also became the first to accept Bitcoin from around the world. It has been almost a decade and digital currencies are now more mainstream than ever.
In their study, Crypto.com noted that as many as 220 million people are using cryptocurrencies around the world today. These customers are using crypto to pay for just about every product imaginable. In less than ten years, where there was once suspicion and distrust, has now evolved into increasing adoption among consumers and retailers.
Cryptocurrencies And Stablecoins
According to a study conducted by Deloitte., merchants are keen on adopting not just one but two different types of digital currencies. These are cryptocurrencies and stablecoins. But what are the differences between the two?
Cryptocurrencies are known as digital assets that are both developed and managed on a decentralized blockchain which can also be used as a “medium of exchange.”
Meanwhile, stablecoins are considered one form of “asset-backed cryptocurrency”. Their value is tied to the value of an “underlying asset”, such as the U.S. dollar or another currency.
Merchants Are Geared Up For Digital Currencies
Since the introduction of the first digital currency, Bitcoin, back in 2008, it has been consumers that have propelled the use and adoption of these cryptocurrencies. In fact, the study found that 64% of the merchants surveyed indicated that their customers have a considerable interest in paying with digital currencies. And as much as 83% of merchants expect consumer interest in paying with cryptocurrencies will intensify over the next 12 months.
As a result of these significant trends, more than 85% of companies are giving “high” or “very high priority” to adopting cryptocurrency payments. Around 83% of merchants are also giving stablecoins a go.
Furthermore, almost 75% of those who were surveyed had plans to accept cryptocurrencies or stablecoins as soon as the next 24 months.
Benefits Of Integrating Digital Currencies Into Businesses
Most merchants agree that incorporating digital currencies as payments gives them a competitive advantage within the market (87%). In actual fact, those who are currently accepting cryptocurrencies as payment (93%) have seen a favorable effect on their business. This was seen in their “customer base growth” and “brand perception.” They also believe that this would be the case in the following year.
There are many merchants that are eager to jump on board and accept cryptocurrencies as payment. They realize that the market is changing at break-neck speed and that customer preferences for payment methods are evolving as well.
Merchants expect to benefit from the adoption of cryptocurrencies as payment in the following ways:
- The improved customer experience (48%)
- Increased customer base (46%)
- The brand is seen as cutting-edge (40%)
In addition, merchants are also driven by the possibility of having immediate access to funds (40%), taking part in the latest in blockchain-based innovation with decentralized digital finance (39%), and enabling “in-house management” of their revenue cycle (39%).
Accepting crypto payments was once viewed as just another innovative marketing strategy to bring in more sales. Not any longer. Beyond marketing, merchants have discovered that accepting cryptocurrencies as payments will mean enjoying the speed of payments as well as cost efficiencies.
Merchants are definitely allowing their money to do the talking. More than 60% of merchants have reported that they have as much as $500,000 in their budget in order to facilitate digital currency payments in the next 12 months.
Facilitating cryptocurrency payments are not without its challenges. Many merchants have expressed concern about keeping their customers’ information secure (43%), the evolving regulatory landscape (37%), and the volatility of the digital market (36%).
Another challenge expressed was more on the technical side. About 45% of merchants expressed concern about the sheer complexity of integrating digital currencies with the current financial structure they have.
Other challenges to digital currency adoption that merchants expressed were: lack of leadership support (31%), unclear ROI (31%), and a lack of budget (30%).
Is Paying With Crypto The Future?
However, in spite of these concerns, merchants remain positive about making the acceptance of digital currencies their priority. The key is to develop partnerships with more established and regulated institutions to help support merchants in their digital currency adoption.
With more education, there will be more aware of how cryptocurrencies work. This would lead to more trust in this digital currency, which could lead to increased adoption.