As part of a wide-ranging interview Bitpay chief commercial officer, Sonny Singh, has explained how Bitcoin is becoming a workable method of payment around the world – and how that’s being driven by regions where confidence in fiat currency is not so strong.
Speaking to Chinese cryptocurrency site 8btc, cryptocurrency payments processor Bitpay – which began life in 2011 and, it says, processed $1.2bn dollars of business during 2017 – has outlined how markets outside of Europe and America are driving adoption of cryptocurrency as a method of payment.
While that impressive amount of trade represents a good amount of business for BitPay, it is dwarved by the kind of trade going on across exchanges where the price of bitcoin and other cryptocurrencies are used for speculation and profit. For example, recent days have seen $5bn of Bitcoin alone change hands between traders within 24hrs – and that kind of trading volume is low compared to when the price of BTC was booming early in the year.
Discussing the perception of Bitcoin in the US, Singh commented that “Even the tech people and college kids [that] bought bitcoin, they’ll not spend it.”
“They bought it only for speculation,” he adds, “if you ask them about bitcoin, they can tell you about the price but nothing else, because they treat it as an investment tool.”
“We need to get these people to actually start to spend bitcoin.”
However, he Bitcoin’s natural home as a method of payment outside of regions where there is almost-unquestioning confidence in the native fiat options.
“In America,” he says, “everyone trusts the US dollar, no one has any other currencies in their back pocket in their home.”
“In China,” on the other hand, “no one really trust the Yuan.”
“People are moving money out of the country for other currencies. That’s why the rest of the world outside of America are such great places for bitcoin.”
“If you [are] in China or Korea,” he adds, “and you have to pay an invoice to America, let’s say a million dollars, and you use bank services, it’ll take you 3-to-5 days for that payment to happen and it will cost 3% to 4% in fees.
“We can do the whole thing in one day for 1% fee by bitcoin. That’s how bitcoin solves a real pain point. It’s cheaper and quicker than bank wire in most regions of the world.”
In previous interviews and talks, Singh has outlined spoken of the ‘HRA’ tech cycle, which he defines as ‘Hype – Reality – Acceptance/Adoption’. Now he believes Bitcoin is in the ‘reality’ phase, but that acceptance and widespread adoption could be just around the corner.
“Four years ago, we asked everyone, but four years later, they all come to us and saying ‘please can we sign up?’ because now there are so many people spending bitcoin. Some of our merchants are doing between 1 million and 10 million dollars a month, which is very exciting.”
“We do a transaction at BitPay every 10 seconds in the world. We see it grow rapidly and we are really excited about the opportunity that bitcoin is now and going to the future,”
“Next year is the A phase, which is the adoption and acceptance phase. That’s when companies like Fidelity, Square, Visa and Goldman Sachs roll out products for mass people to use, bigger than what Coinbase and BitPay could do…”
“This year we’ve seen the price go up 10% and go back down again because there’s nothing sustaining except rumors,” he says, “There’s rumor like Goldman Sachs’ new CEO likes bitcoin, so the price went up; there’s rumor that ETF might happen, price goes up.”
“You can’t keep doing this rumour-based trading,” he concludes, “You either have to have next year real adoption by real companies or next year nothing happens and you start to see the price really start dropping then. And people will be discouraged that it’s been 2-to-3 years with no real products being developed.”
“Well next year, the price will go up based on real fundamentals, real companies with real products. I’m excited about that.”
You can read the full interview here.