Crossing The Rubicon From Trading To Commerce Cryptos

Cryptos, Crossing The Rubicon From Trading To Commerce


Bit by bit, coin by coin, cryptos are crossing the Rubicon from speculation, from trading on exchanges … toward everyday spending.

The Thursday (May 13) earnings report from Coinbase shows that volatility still reigns, that bitcoin and its brethren still have volatility as a hallmark. But the exchange’s numbers show just how eager people are to trade cryptos — and by extension, become more familiar with them.

Of the total transaction-related revenues of $1.5 billion, more than 94 percent came from retail holders. Bitcoin still remains the dominant, go-to name (of sorts) in the space, as it accounted for 62 percent of total assets on the platform, and 39 percent of trading volumes. Monthly transacting users in the most recent quarter came in a 6.1 million, up from 1.3 million a year ago, and up from 2.8 million in the fourth quarter of 2020.

In broadening the crypto ecosystem, as reported late last month, PayPal users can link their wallets to Coinbase, the newly-publicly traded exchange, so that they can buy cryptocurrencies, including bitcoin (among others).

And in joint research from PYMNTS and BitPay, via The Cryptocurrency Payments Report: How Consumers Want To Use It To Shop And Pay, we found that not only is interest in cryptos ascendant, but the intention to use these digital offerings as a conduit in everyday commerce is on the rise.

Real-Life Commerce 

Extrapolate the findings, and a sense of familiarity and, indeed, real-life interactions with cryptos emerges: The data, gleaned from more than 8,000 individuals earlier this year, extrapolated, implies that 12 percent of consumers (a projected 30 million) currently own one or more cryptocurrencies, 4.5 percent (11.5 million) have owned them in the past and 17 million non-owners may acquire cryptocurrency for making purchases in the near future.

A majority of those who own, or have owned, cryptos — at 57 percent — have made at least one purchase with their digital coins through the past year. And, signaling intent, 59 percent of those who have never owned cryptocurrencies want to use them to make purchases at some point in the future.

Take those numbers into account, then, and it seems we are moving well beyond simply trading the coins, and using them as trading vehicles.

As to just where the spending may occur: the PYMNTS/BitPay report found that 46 million consumers, or about 18 percent of the population, would use crypto for retail purchases, regardless of whether they own cryptos at this moment or not.

The ownership cuts skews a bit younger and toward the middle and-upper class. Our research shows that about 19 percent of owners are millennials (and that more than 27 percent of all millennials and bridge millennials have owned cryptos or currently own them), and 16 percent of holders make between $50,000 and $100,000.

And everyday commerce might see crypto spent across categories like groceries, gaming and clothing. Roughly a quarter of owners who have used cryptocurrencies to buy goods and services have spent their holdings in at least one of those categories.

Drilling down a bit, the top five things current and former millennial cryptocurrency owners would consider paying for with cryptocurrencies would include are travel and leisure (62 percent), real estate (60 percent), professional services (58 percent), furniture and appliances (57 percent) and financial services (56 percent).

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May 14, 2021 at 04:14PM