FIS Worldpay – one of the leading global fintech providers – recently released a joint report with Crypto.com covering attitudes around cryptocurrency as a medium of exchange. It found great interest among merchants and customers in using cryptocurrencies to transact in 2022.
Consumers 'hungry' for cryptocurrencies
According to report, titled “Crypto for Payments”, there is currently a ~10X disparity between customers and merchants transacting in cryptocurrencies. While 40% of customers would like to use their cryptocurrencies to buy things, only 4% of merchants actually accept it. On the other hand, 60% of customers and merchants showed interest in using/accepting cryptocurrencies this year.
However, actual adoption is likely to be much slower than that. The steep learning curve of cryptocurrency and the complexities of coordinating these new payment systems across in-house teams will be onerous challenges for institutions. If they are overcome, the report claims that merchants can benefit from lower transaction fees and dispute costs, while appealing to a wider customer base.
A possible contributor to the customer-merchant disparity is the price volatility that cryptocurrencies are prone to. Merchants may be hesitant to sell their products for these assets for fear that their value will drop substantially the next day.
As such, solutions such as Visa and Mastercard prepaid crypto cards have emerged. Users can load these encrypted cards and use them to purchase products anywhere traditional payment processor cards are accepted. Each will convert users' funds into fiat currency on the backend, before putting them into the merchant's account.
Currently, 65% of crypto.com members use the crypto.com Visa card, clearly demonstrating customer demand for cryptocurrency purchases.
The study specifically surveyed 110,000 Crypto.com customers and over 1.5 million WorldPay FIS merchants. A similar study by Visa found that 25% of small business owners plan to accept cryptocurrencies this year.
Where is the interest most concentrated?
Perhaps unsurprisingly, the report found that merchants are more interested in accepting USDC and large-cap cryptos for payment. Customers felt the same, but with additional interest in using crypto.com’s native Cronos token – although this is likely due to biased sampling.
Across industries, luxury goods merchants showed a strong interest in accepting cryptocurrencies for payment (80%). Customer interest was more balanced across market sectors, showing slightly more interest in using cryptocurrencies for travel – although merchants seemed less accommodating in this space.
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