Nearly 75% of retailers plan to accept cryptocurrency or stablecoin payments in the next two years, according to a June survey by Deloitte titled “Merchants Gearing Up for Crypto”.
Deloitte surveyed a sample of 2,000 senior retail industry executives representing a variety of subsectors including cosmetics, electronics, fashion, transportation, food and beverage.
While digital currencies like Bitcoin are often only as valuable as users think they are, a stablecoin is a type of cryptocurrency that derives its value from an underlying asset. Stablecoins are often pegged to currencies like the US dollar or a commodity like gold.
Although paying with cryptocurrency is fairly new now, 83% of retailers expect consumer interest in digital currencies to increase over the next year and just over half of them have invested more than $1 million to enable the cryptocurrencies. digital payments, according to the survey.
For consumers, that means they will soon be able to buy clothes, drinks, beauty products, and more with cryptocurrencies.
Although retailers plan to accept digital currency as payment, that doesn’t mean they necessarily plan to keep the virtual assets.
Just over 50% of those surveyed plan to have third-party payment processors convert digital currency into fiat money, which is money that a government sets as legal tender, such as the US dollar, British pound, and euro. This means that the retailers do not plan to actually own the cryptocurrency that is used for payment.
Given the unpredictability of the cryptocurrency market, using this strategy is considered less risky for retailers than holding the cryptocurrency themselves. This approach also makes it faster and easier for retailers to enable digital currency payments, reports Deloitte.
Crypto-curious retailers acknowledge that there are a number of challenges to overcome in order to enable digital currency payments. Nearly 90% cited the complexity of making their existing financial infrastructure compatible with multiple digital currencies as their biggest challenge.
Additionally, the security of payment platforms topped the list of barriers to adoption, the survey revealed, followed by concerns about the changing regulatory landscape and the instability of the digital currency market.
More than half of retailers agreed that certain regulations should be enacted regarding cryptocurrencies, including national guidance on holding digital assets, clarity on the tax implications of using digital currencies, and the ability to hold digital currencies in a bank account.
Despite their concerns, retailers remain optimistic about the benefits of enabling cryptocurrency payments. Nearly half of retailers believe this move will improve the customer experience and increase their customer base.
“We anticipate that new partnerships with industry-established and regulated institutions will help deliver the benefits of digital currencies (eg, convenience and support) and continue to build the necessary foundation of trust,” the report concludes.
While the ability to pay with cryptocurrency may be welcome news for some cryptocurrency users, it is important to remember that these assets can be highly volatile and experts generally recommend investing only as much money as you are willing to lose.