Chainalysis’ latest analysis of geographic trends in cryptocurrency adoption and usage offered data explaining that global adoption of cryptocurrency payments has grown by over 2,300% since Q3 2019 and over 881% in 2021.
The blockchain market size for retail alone is set to reach USD 4.6 billion by 2028, as more industry players make an effort to align their offers with market demands. More in-depth, Coindesk estimates that big corporations will be joined in this race in a significant amount by SMEs diving into the crypto pool, considering there has been a global 75% increase in customers and suppliers asking for cryptocurrency as a payment option.
When it comes to the array of payment methods at the checkout, crypto has seen a radical change in optics and trust from the greater public and retailers. With increased focus on security, authentication protocols, and a recently fuelled mobile payments popularity, experts estimate crypto to become a payment method as common as credit cards.
Central, Northern, and Western Europe stand at the top of the charts when it comes to global crypto adoption, receiving over USD 1 trillion worth of cryptocurrency over 2021 (25% of the world’s total). Europe is followed by North America, having received over USD 750 billion in cryptocurrency between July 2020 and June 2021, as per Chainalysis rankings.
In spite of the spurt in adoption and technology keeping up with demand, the rest of the world is divided between legalisation, country-wide bans (in some Asian countries), or some governments’ logistic or regulatory incapacity to keep up with the organic growth of their markets. Several countries in emerging markets, including Kenya, Nigeria, Vietnam, and Venezuela register significant transaction volumes on peer-to-peer (P2P) platforms when adjusted for PPP per capita and internet-using population.
Local and global regulation concerns
Starting from the top down, the world has been trying to cut a path for crypto to find its way among legitimate and safe payment methods in the last year – which was affluent in crypto regulation news. The World Economic Forum’s Digital Currency Governance Consortium (DCGC) came out in July 2022 with research and analysis of the macroeconomic impacts of cryptocurrency and fiat-backed stablecoins, signalling a ‘timely and precautionary evaluation of the possible macroeconomic effects of cryptocurrencies and stablecoins and corresponding policy responses’.
While the EU launched the Markets in Crypto-Assets (MiCA) provisional agreement in June 2022, the US saw the release of the Framework for International Engagement on Digital Assets. Among the main purposes of both these large-scale regulatory frameworks is to protect consumers, investors, and businesses working with crypto, while mitigating risk and supporting the responsible development of digital assets.
Between bans and legalisation
While some countries trouble themselves with finding ways to make crypto safe, others do not take any risks. In July 2022, two major markets started discussing complete bans. The Reserve Bank of India is proposing strong regulation or a total ban of cryptocurrencies in the world’s second-largest Internet market. Furthermore, India already proposed a 30% tax on crypto and NFTs incomes in February 2022, giving bankers, traders, and financial institutions mixed feelings regarding its onboarding with crypto assets. In the same month, Russia supported the adoption of a bill banning payments for goods and services using digital financial assets (DFAs) within the country.
On the opposite side of the coin, following the ongoing war in Ukraine and the aid received by the Ukrainian government in cryptocurrencies, the country’s President, Volodymyr Zelenskyy, has legalised the use of crypto.
Shopping with crypto in 2022
While Meta announced in July 2022 that it will discontinue its digital wallet for cryptocurrencies, Novi, announcements regarding big brands and ecommerce platforms and marketplaces accepting crypto payments in their stores or networks have been more abundant than ever before.
From Shopify announcing in May 2022 that it will enable Crypto.com Pay within their network to eBay and Farfetch accepting crypto in their merchant ecosystems, the news did not stop there. Luxury brands such as Balenciaga or Gucci also joined ranks with either Bitcoin or a wider range of digital coins as valid payment methods in their stores.
Upping the ante in terms of the latest trends, Japanese retailer Rakuten has announced the launch of an NFT marketplace, which will allow users to not only purchase NFTs, but also sell them in a range of areas, including music, sports, entertainment, and anime.
Crypto-payments company MoonPay (backed by a slew of famous investors) has raised approximately USD 87 million in its latest funding round in April 2022. Late in 2021, the startup raised USD 555 million in a Series A round that valued the company at USD 3.4 billion.
At the same time, crypto platform Binance.US raised more than USD 200 million in its first funding round, valuing the company at USD 4.5 billion. Binance.US will reportedly use the new funds to develop new products and services, as well as kickstarting ‘educational initiatives to bridge the knowledge gap’.
This article was first published in Payment Methods Report 2022, the most updated overview of trends and developments in the payment methods space and the innovative technologies that these methods work upon, emerging consumers habits, and strategies on how to win at conversion and retention.
About Alexandra Constantinovici
Alexandra is Senior News Editor at The Paypers. A passionate writer, Alexandra has an extensive background in journalism – as a graduate of Journalism and Communication studies –, as well as editing, publishing, and marketing. She coordinates the news coverage at The Paypers and, together with the team of editors, she strives to bring forward the latest trends for our readers, while investigating and sharing with our community the upcoming innovative industry shifts.
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