Crypto payments

Aussies buy fuel and chips with crypto across 175 fuel outlets

Commenting on the rollout, Crypto.com’s Karl Mohan tipped the adoption of an AUD-backed stablecoin as being the catalyst to make crypto payments mainstream in Australia.

Convenience store and petrol station brand On The Run (OTR) has launched crypto payment support across all 175 of its petrol stations and convenience stores across Victoria, South Australia (SA), and Western Australia (WA) as of Thursday.

As previously reported, the move is part of a collaboration between OTR, Singapore-based exchange Crypto.com and DataMesh, a Sydney-based payment systems provider.

The exchange has provided its Pay Merchant service as a payment settlement layer, while Datamesh has provided the point of sale terminals.

Speaking with Cointelegraph, Crypto.com’s Asia & Pacific general manager Karl Mohan noted that it only took “eight weeks to from the time of proof of concept to the point of actually getting a full scalable production-ready environment.”

Mohan noted that while 175 OTR stores have initially been outfitted with the infrastructure, the crypto payments service is operationally ready to scale much further.

“What happens now is any merchant, whether you’re a cafe owner or someone who runs thousands of stores, could just plug and play,” he said.

Adding to the 175 stores, OTR’s parent company Peregrine Corp intends to roll out the crypto payments service to another 250 retail sites across the country such as Subway, Oporto and Krispy Kreme.

Mohan also stated that Crypto.com charges zero fees on the transactions in this context. However, there will be fees on the merchant’s end, which will set their own rates. Such may suggest that transaction costs could be similar to that of card payments with fiat.

Questioned on what is needed to make crypto payments widely adopted in Australia, especially given the tax obligations of paying with crypto assets, Mohan opined that the utilization of an Australian dollar-backed stablecoin could be the key:

“So of course, Bitcoin and Ethereum because of their market capitalization are already on the top of the list. But an overwhelming number of consumers have said they are ready to accept and actually start paying with Australian stablecoins.”

“We’ve made the system available and if you’ve seen ANZ announce the Australian dollar stablecoin, and we see these types of stablecoins becoming available, I really believe that it will become mainstream,” he added.

Related: Australian Securities Exchange takes step towards tokenized asset trading

So far, the ANZ bank has pilot tested its A$DC stablecoin purely for private institutional purposes, but if it eventually does get opened up to the retail market, Mohan stated that “we would love the opportunity to work with any financial or any Australian deposit-taking institution that is keen to introduce a stablecoin.”

Buterin: Layer-2 scaling will make crypto payments ‘make sense’ again

“It’s a vision that has been, I think, forgotten a little bit and I think one of the reasons why it has been forgotten is basically because it got priced out of the market,” Vitalik Buterin said.

Ethereum co-founder Vitalik Buterin has argued that crypto payments will once again “make sense,” as transaction costs will soon fall to fractions of a cent due to layer-2 rollups.

The Cointelegraph team currently on the ground at Korea Blockchain Week (KBW) quoted Buterin as stating that the final hurdle to getting transactions down to fractions of a cent at scale is blockchain data compression. 

He pointed to “solid work happening” with rollups at the moment such as Optimism’s layer-2 scaling solution for Ethereum, which has worked to get the size and cost of data in blockchain transactions down by introducing zero byte compression:

“So today with roll ups, transaction fees are generally somewhere between $0.25, sometimes $0.10, and in the future with roll ups with all of the improvements to efficiency that I talked about. The transaction costs could go down to $0.05, or even maybe as low as $0.02. So much cheaper, much more affordable, and a complete game changer.”

Despite primarily functioning as a speculative store of value, Buterin emphasized the key use case of Bitcoin (BTC) presented in its white paper from 2008 was to provide a “peer-to-peer electronic cash system” that was cheaper than traditional payment methods.

While that was true up until 2013, according to Buterin, however, this became no longer the case in 2018 when adoption increased and blockchain transactions became too expensive.

“It’s a vision that has been, I think, forgotten a little bit and I think one of the reasons why it has been forgotten is basically because it got priced out of the market,” he said.

In the Ethereum co-founder’s view, BTC and other assets will soon be able to provide this use case once again as scaling solutions — such as the Lightning Network in the case of BTC — gradually bring the costs down to fractions of a cent.

Crypto payment use cases

Buterin outlined a couple of different areas that cheap crypto transactions will be particularly important. Firstly he pointed to “lower income countries or places where the existing financial system is not very effective,” as it will give citizens access to vital payments structure over the internet, something which is already adopted despite the cost of international remittances.

Related: 60 million NFTs could be minted in a single transaction: StarkWare founder

Secondly, he noted that in the context of Ethereum, cheap crypto transactions will also help ramp up adoption for non-financial applications such as domain name system (DNS) servers, humanity proof-of-attendance protocols and Web3 account management services:

“You need to actually send a transaction to create a DNS name, you need to actually send the transaction to recover your account, you need to actually send a transaction to meet some of these adaptations. If doing each of those operations costs like $11, then people are not going into it.”

“Scalability isn’t just like some boring thing where you just need like cost numbers go down scalability, I think actually enables and unlocks entirely new classes of applications,” he added.

Gucci becomes first major brand to accept ApeCoin payments

Gucci has ramped up its Web3 initiatives by allowing crypto nerds to purchase its products with ApeCoin in its stores, adding to a list of 12 other digital assets it accepts for payment.

High-end Italian fashion giant Gucci has become the first major brand to accept payments in the form of the Bored Ape Yacht Club-affiliated ApeCoin (APE).

The move was announced on Monday and could provide the ApeCoin project with significant mainstream exposure along with bringing further utility to the cryptocurrency.

Gucci customers in the United States will now be able to purchase items in-store with APE, while the payment infrastructure will be provided by BitPay, a firm that has helped big names such as AMC Theaters accept crypto payments in the past.

Despite the ongoing crypto bear market, the fashion brand has taken a serious plunge into the crypto sector this year.

In February, Gucci kicked things off with the “SUPERGUCCI” NFT collection in collaboration with vinyl toy brand SUPERPLASTIC. The following month, Gucci rolled out the “Gucci Grail” NFT collection targeted toward owners of top NFT projects such as the BAYC.

In May, the firm then went on to announce plans to accept 12 crypto assets as payment methods across 111 stores in North America. The list included Bitcoin (BTC), Bitcoin Cash (BCH), Ether (ETH), Wrapped Bitcoin (WBTC), Litecoin (LTC), Shiba Inu (SHIB), Dogecoin (DOGE), and five U.S. dollar stablecoins.

BAYC collectors seem to have shown strong support for Gucci’s crypto moves so far, with pseudonymous Twitter personality NBATopShotEast claiming to be the first person to pay for Gucci items in ETH at the brand’s Wooster Street location in New York City in July. Another two BAYC members claimed to be the second and third people to do so.

In response to the latest APE announcement, NBATopShotEast outlined plans to once again be the first person to use the asset in the Wooster Gucci store.

The Apecoin community

APE was launched following much anticipation earlier this year in March. Its accompanying decentralized autonomous organization (DAO) and governance community has since remained highly engaged and has overseen important decisions such as the vetoing of a proposal to port APE from Ethereum to a new blockchain in June.

Last month, the DAO voted in favor of several notable proposals, such as studying the feasibility of hosting an NFT conference and festival and providing APE funding for the Bored Ape Gazette to become a 24-hour news site. Additionally, the project is working on rolling out APE staking in response to a strong push from the community.

At the time of writing, APE is priced at $6.74 after pumping 11.4% over the past seven days. APE has shown a strong resurgence of late, due in part to positive developments in the affiliated Otherside metaverse project, with the price increasing by 49.1% over the past month.

Related: Tiffany & Co turning CryptoPunk NFTs into $50K custom pendants

Its current market cap of roughly $2.06 billion makes APE the 33rd largest asset in crypto. However, APE is still down 74.8% from its all-time high of $26.70 on April 28.

Accepting Bitcoin for your business just like Tesla: Report

Merchants that accept crypto rather than credit cards for payments can expect to save as much as 3.5% — or more.

Tesla temporarily embracing Bitcoin (BTC) as a method of payment for its products was conceivably one of the catalysts that pushed asset prices to record highs last year and put the spotlight on crypto legitimacy — particularly in the realm of payments. Moreover, crypto enthusiasts had lauded the fact that Tesla even set up its own node to accept BTC and stated that it wouldn’t swap its holdings for fiat, implying high confidence in the crypto’s long-term prospects.

But despite having backtracked and ceased its Bitcoin acceptance a few months after due to climate concerns, Tesla was only a cog in the adoption machine of 2021. Starbucks, Whole Foods and AMC Entertainment were just some of the other juggernauts that made their foray into crypto last year. However, what’s apparent is that headlines play favorites to household names. For other businesses that want to hop on the trend, it’s a question of how to start.

Cointelegraph Research’s latest report provides answers. The 35-page paper goes over the booming trend in crypto acceptance and practical ways any business can integrate cryptocurrencies into their operations. Additionally, the report also looks at the future of crypto in payments, particularly concerning regulation, and a lot more.

Why should businesses accept crypto?

Cryptocurrencies are believed to be in a phase of hyper-adoption, and the 178% increase in the global crypto population is further evidence of that. For businesses, accommodating this growing demographic would mean an expansion of their potential client base. Receiving payments in crypto is also a lot cheaper when compared to TradFi methods, which may improve a company’s bottom line. Merchants could save up to 3.5% in fees — or more — if the payment method is in crypto rather than credit or debit cards.

Download the full report here, complete with charts and infographics

Chargebacks are also another drawback with TradFi payment methods, costing e-commerce merchants $125 billion in 2021. Chargebacks are a type of payment reversal where the merchant returns the sum of money to the customer due to a transaction dispute or if the customer returns the purchased product. However, chargebacks can also be outright fraud, as some customers may dispute a transaction to secure a refund despite having zero issues with the product or its delivery.

The process of accepting crypto

Whether a company sets up its own node like Tesla or opts for a payments processor to facilitate the transaction, the way to do it is more or less the same but differs under the hood. For instance, certain payments processors can allow a merchant to receive crypto but would also enable real-time settlement in fiat. This effectively removes price volatility while giving the merchant the flexibility to accept digital assets. Of course, the downside is that it subjects the company to the often drawn-out procedures in TradFi.

The other side to this is to accept the actual crypto-asset wholeheartedly, and there are various reasons for doing so. Long-term price appreciation is the most common argument, but companies can also hold on to crypto assets for rainy-day situations. Merchants can also earn additional revenue by utilizing the avenues available within the crypto space, such as locking cryptos in DeFi protocols to earn yield from staking or lending.

Ultimately, the deciding factor on the channel to receive crypto assets will depend on the merchant. The factor that needs to be considered is whether the objective is to hold cryptocurrencies or tap into the growing crypto customer base — or maybe even both.

Download the full report with more detailed information, complete with charts and infographics on the Cointelegraph Research Terminal.

This article is for information purposes only and represents neither investment advice nor an investment analysis or an invitation to buy or sell financial instruments. Specifically, the document does not serve as a substitute for individual investment or other advice.

75% of retailers eyeing crypto payments within 24 months: Deloitte

Improving customer experience, increasing the customer base and the hope their brand is perceived as “cutting edge” were the biggest reasons given for a desire to adopt crypto payments.

Three-quarters of United States retailers plan to accept crypto or stablecoin payments within the next two years, according to a new survey published by Deloitte.

It also found that more than half of large retailers with revenues over $500 million are currently spending $1 million or more building the required infrastructure to make it happen.

The information was revealed in Deloitte’s “Merchants Getting Ready For Crypto” report released in collaboration with PayPal on Wednesday.

A large majority, around 85%, of the surveyed merchants said they anticipate that cryptocurrency payments will be ubiquitous in their respective industries in five years.

The survey polled 2,000 senior executives at U.S. retail organizations between December 3 and December 16, 2021, when crypto prices were still riding high, but the results have only just been revealed. The executives were distributed equally among the cosmetics, digital goods, electronics, fashion, food and beverages, home and garden, hospitality and leisure, personal and household goods, services and transportation sectors.

Small- to medium-sized companies are also getting into the acts, with 73% of retailers with revenues between $10 million and $100 million investing between $100,000 to $1 million to support the needed infrastructure.

Source: Merchants Getting Ready for Crypto: Merchant Adoption of Digital Currency Payments Survey

According to Deloitte, the spending won’t stop there and is only expected to increase over 2022. More than 60% of retailers said they expect budgets of more than $500,000 to enable crypto payments in the next 12 months to December.

Consumers push for crypto payments

Consumer interest is driving merchant adoption, with 64% of merchants signaling their customers have expressed significant interest in using crypto for payments. Roughly 83% of retailers expect interest to increase or significantly increase over 2022.

Source: Merchants Getting Ready for Crypto: Merchant Adoption of Digital Currency Payments Survey

Nearly half expect their adoption of cryptocurrency will improve the customer experience, around the same amount believe it will increase their customer base, and 40% hoped their brand would be perceived as “cutting edge.”

Related: Corporate evolution: How adoption is changing crypto company structures

Retailers optimistic on digital currencies

Of the retailers already accepting cryptocurrency, 93% have reported a positive impact on their customer metrics.

Source: Merchants Getting Ready for Crypto: Merchant Adoption of Digital Currency Payments Survey

Carriers and challenges to adoption cited by merchants include the security of the payments system (43%) changing regulations (37%), volatility (36%) and a lack of a budget (30%).

The complexity of integrating cryptocurrencies with legacy systems and the complexity of integrating multiple cryptos was the greatest challenge, according to 45% of the surveyed merchants.

Deloitte said it expects “continued education” would create further clarity for regulators, allowing wider adoption across a broader set of products and services.

Taco tokens: Chipotle adds crypto payments via Flexa

Nearly 3,000 Chipotle restaurants across the U.S. will accept 98 cryptocurrencies as the Mexican-style fast-food chain partners with Flexa to support crypto payments.

The popular Mexican fast-food chain Chipotle is now accepting cryptocurrency payments through digital payment provider Flexa at all of its over 2,950 United States-based restaurants.

Flexa announced the partnership on Wednesday which will see Chipotle accept all the 98 cryptocurrencies Flexa currently supports including Bitcoin (BTC), Ether (ETH) and seven U.S. dollar-pegged stablecoins like USD Coin (USDC). Chipotle’s website does not contain any information on the announcement, however.

The fast-food giant is the latest Flexa partner joining other large businesses such as cinema operator Regal Theaters and Bancoagrícola, El Salvador’s largest financial institution, where Flexa enables both retail and merchant Bitcoin transactions for the bank’s customers.

Chipotle has briefly experimented with cryptocurrencies in the past. In April 2021 to celebrate National Burrito Day, it gave away $100,000 worth of Bitcoin along with free burritos and claimed it was the first U.S. restaurant brand to offer a crypto giveaway.

For the so-called “chiptocurrency” giveaway, Chipotle partnered with former Ripple chief technology officer Stefan Thomas, creating a game where players guessed a code possibly winning either a burrito or up to $25,000 worth of Bitcoin.

The game parodied Thomas’ experience of losing over 7,000 BTC due to forgetting the password for his crypto wallet which today would be worth over $208 million.

Other fast food names have explored or signaled interest in crypto and metaverse applications for their brands. Burger King partnered with trading platform Robinhood in Nov 2021 and gave away free Dogecoin (DOGE) BTC and ETH with meal purchases.

Related: How can the Metaverse help the food industry?

McDonald’s, known for poking fun at Crypto Twitter, filed multiple trademark applications in February including plans for “a virtual restaurant featuring actual and virtual goods” in the Metaverse and “operating a virtual restaurant featuring home delivery.”

With crypto adoption in the U.S. remaining high despite market turbulence, merchants have expressed a desire to implement payment solutions to capture the growing interest.

A Crypto.com global survey of merchants released in February showed only 4% were already accepting cryptocurrency payments, but nearly 60% of merchants responded with interest in accepting crypto payments within the next year.

Although enthusiasm from merchants overall was high, only around 25% of the hospitality industry respondents were keen on crypto payment adoption.