In recent years, the acceptance and adoption of cryptocurrencies have grown rapidly. Alongside an ever-increasing number of users transacting with digital currencies, there also has been an overwhelming boost in demand for using crypto as a standard medium overall. Merchants and consumers alike have been mainstreaming this once-novel payment method through sheer demand.
To better understand this shift in consumer behavior, Crypto.com and WorldPay from FIS recently surveyed over 110,000 Crypto.com users across geographic areas, ages, and income levels, alongside FIS’ global base of 1.5 million+ merchants in Q4, 2021. This newly published joint report uncovers the key factors behind the growing desire to use cryptocurrencies to pay for goods and services.
Here’s a quick overview of the report:
- Of the total surveyed Crypto.com users, 75% have expressed interest in paying for goods and services using cryptocurrencies.
- Despite the prevailing disparity between customers and merchants who currently transact using crypto, more than 60% of Worldpay’s merchants are willing to accept crypto payments in 2022.
A Dynamic Change in Consumer and Merchant Behavior
In addition to the increasing acceptance of cryptocurrencies overall, the 2022 Crypto for Payments Report indicates that both customers and merchants prefer to conduct transactions using the same set of tokens. Bitcoin (BTC), Ethereum (ETH), stablecoins like USDT, and exchange-native tokens like CRO are among the most preferred cryptocurrencies.
The report further suggests that tokens from new layer-1 blockchains and layer-2 scaling solutions will play a key role in creating a more diverse range of acceptable tokens that will, in turn, cater to customer and merchant preferences like low cost, speed, and security.
Retail and luxury goods businesses are more likely than others to accept cryptocurrencies as payment in the short term. On the other hand, customer preferences are evenly distributed among all industries.
The majority of the surveyed Crypto.com users said that they would like parity between online and in-store crypto payment options, while the FIS WorldPlay merchants stated that they are more focused on supporting online payments.
Preferences Vary by Industries
The report also found that customers are more than ready to start paying for goods and services using cryptocurrencies, and the merchants are those that need to catch up with changing consumer behavior. While most merchants are willing to include online crypto payments options, the enthusiasm is comparatively less for the automotive, travel, and hospitality industries.
When compared to industries that are trying to recover from the turmoil of the COVID-19 pandemic, businesses that are not in survival mode or undergoing independent technology upheavals have a much greater appetite for crypto adoption. According to the report, 80% of the total surveyed merchants from the luxury goods sector and 80% of the retail and grocery sector are willing to start accepting crypto payments as soon as possible.
Luxury goods and retail industries are both interested in accepting crypto payments, with the former taking advantage of the authenticity and providence features offered by NFTs, while the latter is eager to utilize the higher average transaction value of customers who spend dollars in crypto.
On the consumer side, the preferred industry for utilizing crypto for payments is the travel industry. Unfortunately, merchants in this field have ironically shown the least interest in this shift; only 25% of merchants from the travel sector are willing to accept cryptocurrencies at this time.
Lastly, merchants are considering crypto settlement opportunities in 2022 and prefer self-custody to third-party custody. Crypto education and the changing regulatory landscape will ultimately shape merchant preferences, resulting in an inevitable increase in crypto transactions and overall adoption.
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