Crypto Payment Shines Again

Crypto payment has long been deemed an inglorious niche within the blockchain industry. However, recent headlines have brought this sector back into mainstream attention. From supporting regulation, new institutional innovations, and initiatives to the rising stablecoin market and consumer adoption, crypto payment is making waves.

It is hard to ignore the spotlight on Crypto Payments!

In mid-September of this year, Louisiana State Treasurer John Fleming announced a partnership with Bead Pay and local partners, enabling residents to pay for state services with cryptocurrencies. This partnership streamlines payments by converting crypto to US dollars and depositing them directly into a state government bank account, providing more payment options for residents while relieving the state from managing these assets.

Paypal and Venmo have introduced support for Ethereum Name Service (ENS) names, allowing users to send crypto using simple nicknames like 'bob.eth' instead of complex crypto wallet addresses. This is expected to boost crypto payment adoption by reducing the risk of errors.

Donald Trump reportedly made his first crypto payment using BTC on the Lighting Network at a New York City bar and restaurant to pay for his burger.

The Rise of Stablecoins: The Biggest Catalyst for the Crypto Payment

As of 7 October 2024, the total market capitalization of stablecoins exceeded $170 billion, marking its highest point since November 2022. While we have yet to recover from the ATH mark of $190 billion in March 2022, the stablecoin market cap has steadily grown since September 2023.

Stablecoins have undoubtedly risen in popularity in the past few years. As the name suggests, they offer a “stable” means for users to explore the crypto world. Unlike typical cryptocurrencies, which often experience wild swings in value, stablecoins are pegged to traditional assets like fiat currencies, making them far more predictable.

Unsurprisingly, stablecoin’s values and impacts reach far beyond the crypto market. A recent Castle Island Ventures and Brevan Howard report highlights the growing use of stablecoins in emerging markets for savings, currency conversion, and cross-border payments.

The survey of users in Brazil, Nigeria, Turkey, Indonesia, and India found that 69% had converted local currency to stablecoins, and 39% used them for goods, services, or cross-border transfers. Stablecoins are simplifying transactions for those with limited banking access.

Stablecoins are also crucial for business, with 30% using them for business transactions and 23% for paying or receiving salaries. This highlights their role as a reliable medium for income, especially in regions with volatile currencies.

This is exemplified by the partnership between Circle, a global stablecoin issuer, and local banks in Brazil and Mexico to integrate USDC into their respective national real-time payment systems. This allows businesses to directly access USDC from local financial institutions without international wire transfers.

Furthermore, both TradFi and crypto-native are looking to launch their own stablecoins. Over the past few months, there have been many reports of major players like Revolut, BitGo, and Ripple announcing their entry into the stablecoin space.

Regulatory Catalysts: Paving the Way for Broader Adoption

With stablecoins on the rise, governments worldwide are waking up to the power of cryptocurrency and blockchain to boost financial inclusion, transparency, and efficiency. They're rolling out more precise regulations that balance oversight with a push for innovation in the crypto market.

Take the European Union's Markets in Crypto-Assets (MiCA) initiative as an example; it seeks to establish a robust regulatory structure for cryptocurrencies within the EU, focusing on safeguarding consumers while promoting technological advancement. In contrast, the United States strives to refine its approach toward crypto taxation, offering clearer instructions to consumers and enterprises.

Above all, the United Arab Emirates takes a bold leap forward, announcing a VAT exemption for cryptocurrency transactions starting November 15 this year. This strategic move cements the UAE's status as a premier hub for blockchain and crypto innovation.

How Businesses Can Prepare for the Future of Crypto Payments

As the crypto payment landscape evolves, businesses that want to stay ahead must prepare for these significant shifts.

With stablecoin’s growing traction, accepting crypto payment is no longer a nice but a must-have. This is where payment companies like Boomfi come in to help businesses and merchants embrace digital currencies as a legitimate payment method. One practical benefit of stablecoins is removing the high fees and delays associated with traditional banking systems. This is especially valuable to global e-commerce businesses looking for a way to operate more seamlessly globally.

Whether to gain access to a global group of crypto consumers or cut costs, Boomfi is there to help. Boomfi’s platform is simple and user-friendly, allowing merchants to integrate crypto payments seamlessly without requiring in-depth technical knowledge. From setup to settlement, offering your customers a secure and smooth crypto payment experience is just as simple as click and drop.

Another crucial strategy for businesses is to keep up with the emerging regulations. Navigating this constantly changing landscape can be daunting, especially when governments around the world are still in the process of refining their rules book. Thus, having a regulatory-compliant payment partner like Boomfi is crucial, allowing businesses to stay agile and responsive to the changing crypto landscape while positioning themselves as a trustworthy leader within the sector. This empowerment to stay ahead of the regulatory curve should give businesses a sense of control in the evolving crypto landscape.

Parting Thoughts

The evolving regulations and increasing demand for stablecoins are shaping the future of crypto payments. As the industry advances, the significance of crypto payment companies like Boomfi will continue to grow. They are facilitating the adoption of stablecoins and Web3 by bridging the gap between traditional Web2 companies and cryptocurrencies, empowering businesses and retail consumers to recognize the advantages and potential of these technologies.

The time to act is now!