According to Bitpay, one the most prominent cryptocurrency payment processors, bitcoin’s use as a currency has fallen significantly. While bitcoin was the dominant currency for payments in the 2020s, it is now less popular. This has opened up space for new currencies and tokens like ethereum to compete with the Bitcoin market.
Bitcoin use for payments is declining in 2021. Bitpay States
Bitcoin’s use as digital payments currency has dwindled since 2020. Bitpay, a leading cryptocurrency-based payment processor, came to this conclusion after reviewing last year’s market numbers. Bitpay informed Bloomberg that Bitcoin’s market dominance for bitcoin purchases fell from 93% to 65% during 2020 to 65% in 2021. The entry of new currencies to the payments arena has caused a loss of nearly a third of the bitcoin’s dominance.
Stablecoins’ popularity and some of the meme coins’ success last year have also reached the payments market, though in a limited way. Bitpay said that the users pay 15% with ether for purchases and stablecoins 13%. Others newcomers such as shiba Inu, dogecoin and litecoin made up 3% of payments.
In general, Crypto Payments are Rising
While bitcoin (BTC), the most popular cryptocurrency for payment, declined in 2021. Bitpay saw an overall 51% rise in payments volume for 2021, compared to last year. This increase is due to cryptocurrency’s popularity and also the market’s rise last year. On this, Bitpay’s CEO Stephen Pair stated:
The price of our business affects how we do business. People tend to spend more when it is lower. This pullback has not caused a significant drop in our volume.
Bitpay is a well-known crypto payment company that has large sales volumes and manages high volume transactions. However, it still falls short of traditional payments companies such as Paypal and Visa. Pair is young, and it is well-positioned for the future. He declared:
It is a great strategic location. The space is very new. The timing of events is a major factor. The next two years will see a lot of growth.
Some traditional businesses have also entered crypto payment. Paypal stated that it will begin processing crypto-based payments in March.
How do you feel about Bitcoin’s declining use for payment? Comment below.
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