Globally, business models are undergoing a significant transformation, and a similar transformation is happening with paper currencies too. Paper transactions are not attracting the kind of attraction they used to get. The emergence of digital currencies, especially the acceptance of cryptocurrency payments, signifies a pivotal development in the evolution of commerce. A revolution led by Bitcoin a mere decade ago has become a pivotal entity in finance, reshaping how businesses operate and compete.
As 2024 is upon us, cryptocurrency is making another shift after getting “wintered over” and is now ready to make a run for the bears in the market. As was previously predicted by many payment giants and financial experts in the industry, it can change how businesses handle money, which still holds true as we move ahead in 2024. More and more companies see cryptos as good for customers due to their growing use and trust after facing hesitation from the market.
There are many cryptocurrency payment trends that we are witnessing now, and that is what we will discuss today. By staying current with these trends, businesses can be at the top of their knowledge and stay ahead in the crypto field.
This move towards cryptos comes from more acceptance of non-traditional money systems. As buyers get used to using digital money to shop, businesses see the need to change or be left behind. Recent reports highlight that crypto payment gateways could see a growth of 17% CAGR by 2029 as the demand in the market for safe ways to accept and deal with crypto money rises.
Cryptocurrency Payment Trends – Key Takeaways
- Persistent Adoption of Cryptocurrency as a Payment Option: The increasing use of cryptocurrency as a payment method is a response to the issue of chargebacks that merchants face. More and more businesses are opting for cryptocurrency transactions, particularly involving Bitcoin, due to the lack of chargeback risks. Known companies like Microsoft, BigCommerce, Hostinger, Starbucks, and Subway are actively embracing cryptocurrency transactions, signaling a shift in payment preferences.
- Dominance of DeFi in the American Market: DeFi is gaining traction in the American market as a prominent model for cryptocurrency-based exchanges and financial services. It’s decentralized, and the nature of its focus on empowering individuals sets it apart. The DeFi market is expected to witness growth, with an estimated increase of 9.07% by 2028, reaching total earnings of $37.04 billion. The US stands out as a prominent player in the DeFi market, with projected earnings of $12.53 million in 2024.
- Rising Popularity of Crypto Payment Gateways: The use of payment gateways is on the rise as they serve as digital currency payment processors that help diversify available payment options. As cryptocurrencies become widely accepted, these gateways address merchants’ concerns, contributing to their increasing popularity. The demand for methods to accept and handle cryptocurrency payments is increasing, with a projected 17% growth rate by 2029. Businesses and customers are showing interest in this trend.
- StableCoin Poised to Grow in 2024: In 2024, Stablecoins are expected to see growth, offering an option in volatile markets. These coins provide stability against currencies or commodities, acting as a safeguard against inflation. Both individual and business investors are attracted to them for risk mitigation purposes. The Q3 of 2023 saw $5 trillion worth of stablecoin transactions boosted by clearer regulations, investors’ involvement, and advancements in blockchain technology. Collaborations with institutions and technological developments like PayPal’s introduction of its stablecoin (PYUSD).
1. Companies Are Persistent On Accepting Cryptocurrency As A Payment Option
Chargebacks are a headache for merchants, siphoning off revenue, jeopardizing accounts, and demanding significant time and effort for proper resolution. While e-commerce businesses are often eager to embrace tools or strategies to curb chargebacks, one option has met resistance: cryptocurrency. Cryptocurrency transactions, such as those involving Bitcoin, operate without the risk of chargebacks. These transactions utilize escrow services, holding funds until both parties confirm the transaction. Once completed, the transaction becomes irreversible.
This inherent characteristic aligns with Bitcoin’s original purpose—to function akin to virtual cash, ensuring permanent and challenging-to-trace transactions. The same holds true for newer stablecoins, which, by pegging their value to an existing currency like the US dollar, mitigate price fluctuations associated with cryptocurrency speculation. Cryptocurrency serves as a preventive measure against certain chargebacks by offering a payment method immune to such disputes. When customers opt for cryptocurrency over credit cards, any issues that arise must be resolved directly with the merchant.
While chargebacks aren’t the sole reason merchants accept cryptocurrencies, their substantial financial impact, costing businesses billions annually and on the rise, undoubtedly plays a significant role. Accepting cryptocurrency payments has evolved beyond mere novelty or proof-of-concept, evidenced by major corporations such as Microsoft, BigCommerce, Hostinger, Starbucks, and Subway adopting cryptocurrency transactions. This trend extends to numerous small businesses, signaling a broader shift in payment preferences.
Another recent example of companies being persistent in accepting crypto is Watches World, which is a front-runner in e-commerce selling, buying, and trading luxury watches.
Watches World’s CEO, Rudy Esposito, recently emphasized the pivotal role of sourcing exceptional timepieces in the company’s success. This commitment ensures their discerning customers have access to the most desirable and prestigious watch models. Esposito highlighted their dedication to innovation and exceptional service through the continued acceptance of cryptocurrency payments, aligning with the positive momentum in the crypto market in 2024.
2. DeFi Has The Highest Market In America
Decentralized finance (DeFi) is a developing framework for orchestrating and facilitating cryptocurrency-based exchanges, financial services, and transactions. At its core, DeFi operates on eliminating centralized authority, distinguishing itself from the conventional models of finance for fiat currency within the cryptocurrency markets. In centralized models, a central authority holds sway over transaction flows and often manages the custody of assets.
DeFi adopts a decentralized approach where authority is distributed, aiming to empower individuals with greater control. Transactions, including selling, buying, payments with cryptocurrency, and loans, free from the influence of a central authority, are identical to the P2P approach.
There’s some excellent growth expected in the next few years. The numbers suggest a yearly growth of about 9.07% by 2028. That means we could see the total money earned reach $37.04 billion. It’s all thanks to people liking and using DeFi solutions everywhere. In 2024 alone, the average cash a user could make in the DeFi market is up to $1,378. Compared with other countries, the US is ahead of everyone, with $12.53 million in 2024. America is a big player in the DeFi market.
3. Growing Popularity Of Crypto Payment Gateways
A cryptocurrency payment gateway functions as a digital currency payment processor, comparable to traditional payment processors and credit card-acquiring banks. These gateways empower businesses to accept digital payments and instantly receive fiat currency in return. As cryptocurrencies gain acceptance as a valid payment method by an increasing number of merchants, these companies play a crucial role in dispelling uncertainties or reservations that merchants may have about cryptocurrency, thereby expanding the range of payment options available.
The rising popularity of cryptocurrencies fuels the expansion of the crypto payment gateway, as we have mentioned early on (17% CAGR), the increasing number of businesses working with crypto payments, and the growing regulatory clarity surrounding digital currencies.
Companies offering cryptocurrency payment options can attract new customers and boost sales. Simultaneously, businesses providing crypto-based financial services like crypto lending and trading stand to benefit from the surging demand for these offerings. These factors contribute to the growth of the crypto payment gateway market, presenting various opportunities for businesses to capitalize on this evolving landscape. This is also because they expect clearer rules around cryptocurrencies, along with tech improvements like tokenization, smart contracts, cross-border payments, and NFT integration. These trends will keep fueling this booming market.
4. StableCoin Poised To Grow In 2024
Stablecoins are set to skyrocket in 2024. The main reason why most publications are talking about it is because they help individuals who don’t want to “gamble” in shaky markets. Both people and businesses today are trying to avoid risk by spreading their investments around. That’s where stablecoins step in. They stay steady against multiple currencies and goods. These factors make stablecoins a strong shield against inflation.
They protect money from steep up-and-down jumps in regular markets. What’s more, stablecoins aren’t just for individual investors. They’re also useful for big companies needing to square up accounts across borders. Thanks to stablecoins, transactions in different currencies are faster and safer. They make global finance smoother and less of a headache. So, it’s no wonder that stablecoins are tagged for huge growth.
By the third quarter of 2023, $5 trillion stablecoin transactions were made, showing a substantial rise. There were a few reasons for this rise, like more clear regulation, institutional investors, and new ways to use stablecoins. For most of the year, stablecoin transactions went up. People believed more in their steadiness and trustworthiness.
But the end of the third quarter brought some big news that made things take off. Partnerships with big financial firms, getting together with common payment platforms, plus progress in blockchain tech. This should make stablecoin transactions safer and more efficient. All this has made folks in the market more hopeful. They think stablecoins could become a standard way to move and keep wealth. An example of such is PayPal, which launched its own stablecoin – PayPal USD or PYUSD.
Conclusion
In 2024, cryptocurrency payments will be shaped by these key trends, and businesses must keep track of them. The ongoing use of cryptocurrencies, thanks to the inability for chargebacks, is crucial for sellers. Major players, such as Watches World, highlight this through their focus on crypto payments, following the upbeat trend in the crypto domain. DeFi’s rise in the US market shows a change in finance systems as it offers decentralized options and is growing at a fast rate. Analysts expect this growth to go on, with about 9.07% annual growth predicted by 2028, to a total of $37.04 billion.
The increased use of crypto payment portals plays a part in reducing doubt about digital currencies. These gateways, projected to grow by 17% annually by 2029, help businesses pull in new customers and tap into the growing need for crypto financial services. Stablecoins offer security and consistency in 2024, appealing to individuals and businesses searching for a safe investment. The $5 trillion transactions in stablecoins in 2023’s third quarter show increasing faith in their stability and efficiency. Links with finance firms and progress in blockchain tech all contribute to a hopeful future, setting stablecoins as a possible norm in wealth transfer.
By following these trends, businesses can remain on top in the ever-changing crypto world. They can adapt to the shifting needs of customers and tap into the chance offered by the crypto sea change.
