The headlines surrounding cryptocurrency tend to be focused on the price swings of bitcoin, and the increasing scrutiny of regulators.
But earnings season, and recent PYMNTS research, help to shed a light on the use cases and the inroads that cryptos have made in retail and commercial settings.
PayPal stands as a tell, of sorts, on the strides some firms are taking in the bid to make cryptocurrencies such as bitcoin a payments choice in mainstream commerce. As has been detailed in past months, the company has made it possible for digital wallet holders to buy and sell and store crypto. Moving ahead, crypto will be spendable at the tens of millions of merchants linked to PayPal beginning next year.
Read more: PayPal Becomes Latest Big Tech Firm To Hop On The Crypto Bandwagon
During the company’s most recent earnings call, CEO Dan Schulman said that “we continue to be really pleased with the momentum we are seeing in crypto,” and the company remains in the midst of open banking integration.
Related: Venmo Volumes Grow 58 Pct YoY To $58B
Beyond PayPal, of course, lie the efforts of other firms, such as Visa, which has said it has inked pacts with more than 50 cryptocurrency platforms and exchanges to allow end users to spend digital currencies at 70 million merchants globally via crypto-linked cards.
More: Visa Expands Ecosystem For Crypto-Linked Cards As Spending Tops $1B
Moving Beyond Retail
Beyond retail, it’s important to note that institutions have been getting on board with crypto, and the blockchain technologies that underpin the transactions themselves. Multinational firms, marked by global reach and complexities of operations, may seem a natural fit for an embrace of the blockchain.
In fact, in new PYMNTS research, 58 percent of these multinationals have used cryptos, and the settings have been more transactional in nature, where once the cryptos had mostly been held on balance sheets for investment purposes. Only about 10 percent of financial institutions (FIs) grant those multinationals access to cryptos, but 73 percent of FIs intend to expand access to those digital holdings, so it seems clear that the financial services sector is gearing up to be ready to satisfy anticipated demand, especially as multinational firms are six times more likely to use cryptocurrencies to conduct transactions than they are to hold them as investments.
See more: 58 Percent Of Multinational Firms Are Using Cryptocurrency
Exchange operator Coinbase signaled a bit of this investment-to-transaction mindset shift in its own results on Tuesday (Aug. 10). In its earnings materials, the company said that “institutions are becoming more sophisticated and are seeking to do much more than buy, sell, and store Bitcoin. Increasingly, our institutional customers see Coinbase as a one-stop shop for the services they need including trading, custody, lending, yield generation, data, and more across a broad spectrum of crypto assets.”
Also from Coinbase, with insight into the retail landscape, and in particular detail on Coinbase Card and Coinbase Borrow (the borrowing function allows people to borrow using bitcoin as collateral; the card allows users to spend on their cards wherever Visa is accepted), CEO Brian Armstrong stated that those offerings are evidence of the “expanding crypto economy.”
Read also: Coinbase Monthly Transacting Users Surge 44 Pct
But none of this is to say that the path ahead is free and easy and clear. A slew of agencies are quickening their efforts to examine the space — focusing on everything from taxes to security to how cryptos should be handled by banks. If some activities are curtailed, then we might see a dampening of demand across retail use cases or institutions or across the board.
See more: From Taxes To Trading, Federal Scrutiny of Crypto Regulation Is On The Rise
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