The value of the cryptocurrency market reached $2 trillion in early April. Bitcoin, the most popular digital currency, accounts for more than 50% of the entire market capitalization.
1. Elon Musk announced on Twitter that Tesla has suspended car purchases with bitcoins, over concerns about the increasing use of fossil fuels in the production of cryptocurrencies
. 2. Three Chinese state organizations (National Internet Finance Association, China Banking Association, and China Payment and Clearing Association) have issued a warning to stop accepting or using crypto -currencies as means of payment. The Asian country is concerned about the speculative risks that cryptocurrencies pose to its financial system and social stability.
The volatility of cryptocurrencies is not new, which is why most people consider digital currencies as a tool for speculation in trading activities rather than an alternative means of payment. Even so, cryptocurrency adoption is spreading across the globe, with the purchase of luxury goods leading the way. Several factors show us that digital currencies are revolutionizing the modern economy. However, many experts are still uncertain about their future.
WHAT IS A CRYPTOCURRENCY?
A cryptocurrency is a digital asset that can be used to purchase goods and services through a decentralized computer network. Cryptography helps protect transactions, control the creation of additional coins, and verify the transfer of coin ownership. The technology behind cryptocurrencies is called blockchain. The luxury industry has been at the forefront of cryptocurrency adoption, which is why one of the most common questions we receive from our customers is:
“Cryptocurrencies represent- they the future of payments for the luxury industry?“.
1. Major payment service providers promote cryptocurrencies: Payment systems like Visa and Mastercard are building strong alliances with fintech players and central banks to drive cryptocurrency adoption: Visa has partnered with Coinbase to launch a debit card that lets customers pay with cryptocurrencies. Mastercard has launched a testing platform to help central banks test their digital currencies.
2. Cryptocurrency payment providers are spreading around the world: When it comes to cryptocurrencies, another question we get asked is: “Is there already a payment provider that can help me manage cryptocurrencies? “. The answer is yes and here are the main ones:
Blockonomics, BtcPay, CoinGate, and CoinPayments are examples of the leading payment gateways in the market. They allow merchants to accept various cryptocurrencies and convert them in real time. Bitpay offers an online payment solution where merchants can create an invoice and share it with the customer. The customer can pay in bitcoins, then Bitpay converts the payment into the merchant’s local currency. Lunu offers a mobile payment terminal that allows retailers to accept payments in cryptocurrencies.
3. Acceptance of cryptocurrencies is a reality in any type of industry: Blockchain technology is revolutionizing the way we pay and transfer money. According to BitPay, more than 100,000 merchants worldwide accept cryptocurrencies: Wikipedia accepts bitcoin donations; Microsoft allows the use of bitcoins to recharge its accounts; Burger King, KFC and Subway accept bitcoins for payment of their products. There are casinos in Las Vegas where customers can exchange bitcoins for cash to bet on the tables or later convert their winnings into bitcoins. There are a few ATMs where you can convert currency into bitcoins or withdraw bitcoins cash in local currency.
The list of examples that can be given is long, but what about the luxury industry?
4. The luxury sector is at the forefront of cryptocurrency adoption: Consumers can already shop on several e-commerce sites such as BitDials, BitLuxuria, and CryptoEmporium, where they can pay with bitcoins to buy luxury goods. Currently, the luxury industry is one of the main sectors to adopt cryptocurrencies as a new method of payment. The reason is very simple, cryptocurrencies offer considerable advantages over traditional payments: Funds can be transferred anywhere in the world in minutes and securely. Transaction fees are significantly lower than traditional payment methods Customers and retailers in the luxury sector have serious fraud problems due to the average purchase amount. The level of security offered by the blockchain removes the risk of chargebacks, as transactions cannot be undone.