Bitcoin Is The Future of Payments
Bitcoin offers a new way to think about the future of your business payments.
A challenge at any business is deciding how to best allocate valuable resources to bring the types of change required to manage through the crises of today and be successful tomorrow.
Accelerated by the global pandemic, the turn to a cashless society and the growing role of payments as more than a simple exchange of value for goods and services is creating a once-in-a-lifetime opportunity for the payments industry. By becoming a cornerstone of the global economy, payments can catalyse economic growth and inclusion which Bitcoin will (and already is) almost certainly playing a major role in.
Every business needs to decide what its role will be in this evolution. Firms must understand what they need to do and how quickly they need to do it in order to stay relevant, improve the customer experience and contribute to a better societal goal.
Digital tokens or electronic records that represent a virtual form of currency, along with cryptocurrencies, are expected to have the largest disruptive impact over the next 10 years.
Frustration with the traditional banking system, both cumbersome and expensive in a world of instant, low-cost payments, has led to the intensification of non-bank providers. New players and solutions are competing with the bank and card-based solutions at scale.
Bitcoin, the original decentralised cryptocurrency, has quickly started to replace account-based payments with a tokenised system of non-sovereign payment practices since it was first launched in 2009.
Decentralising Traditional Finance
Uncertainty within the central banks about the potential of cryptocurrencies to threaten the conduct of monetary policy may begin to change, as some have recently said they are prepared to facilitate the use of such cryptocurrencies.
BIS recently conducted a survey that showed 60% of central banks are considering a digital token of sorts and 14% are already in pilot tests. Many believe China could be the first to launch its digital Renminbi at the Winter Olympics next year in what would be seen as the start to the decentralisation of finance as we know it.
The shift to digital is well-underway whether people like it or not, with digital wallets already playing a major role in day-to-day finances. These wallets are pivotal as a payment “front end” as shown by the likes of Apple Pay, Google Pay, and WeChat who are leading the way. The use of digital wallet-based transactions increased by 7% in 2020 alone according to FIS, a finance tech group, who predicts that digital wallets will account for more than 50% of all eCommerce payments worldwide by 2023. This is as customers shift from card-based to account and QR code-based transactions.
As a result of these figures, banks and card companies have been desperately scrambling to partner with or invest in digital wallet businesses to build payment platforms.
If in 2 short years, over half of worldwide eCommerce transactions will be digital, how will your business be affected? It’s going to be very interesting to see this play out… I know which side I’m on, do you?