What impact will cryptocurrency have on business payments?

Right now, the world is abuzz with excitement and interest for blockchain.

Sure, many people only have a surface-level understanding of the technology, if any at all, but there’s definitely some hype surrounding this new technology.

And there's reason to be excited, too.

Blockchain technology offers numerous advantages over its centralized counterparts. The number of use cases has continued to grow, with applications that are having real-world impacts even today.

It has now progressed from a rare and underutilized technology to one being used by some of the biggest names in the payment market and beyond.

This interest is then feeding into further development of products and services using the technology, helping to fix common pain points across a wide range of industries.

This brings us to cryptocurrencies. These represent the best known use case of blockchain, and seem to fit perfectly with the needs of many businesses, especially when it comes to their payment strategies.

It’s in this context that we at the AirPlus Global would like to explore exactly what cryptocurrencies can mean for the payment industry and how it may just revolutionize the way businesses make and process payments.

Before we get too ahead of ourselves, let's go over the basics.

What is Blockchain?

A blockchain is a kind of digital ledger – a record that can store information such as transaction data in a decentralized way.

This information is stored in blocks that are all chained together, hence the name. It is thanks to this design that they (the blocks) cannot be changed or altered without then changing every other block before it.

It’s also distributed, meaning it’s not stored in any one place or managed by any individual corporation. Instead, it’s spread out in a network.

This decentralized structure offers many different benefits, such as being secure, immutable and democratic, in that anyone can get involved with a arguably low threshold to entry.

Then there are cryptocurrencies, which are digital assets that operate on blockchains.

These have many different use cases, and can offer utility in specific blockchain networks or work as a store of value or currency, like Bitcoin.

For the purpose of this article, this should be all you need to know. The technology does go much deeper though and is well worth reading into if you are interested.

For now, let’s jump into exactly what blockchain can do for payments.

How can Blockchain be applied to payments?

This is the big question.

The obvious way to bring blockchain to the world of business payments is through the use of cryptocurrencies, as they are currencies in and of themselves. However, they are not all created equal.

Two of the biggest names in the blockchain and cryptocurrency space – Bitcoin and Ethereum – were created as an alternate, decentralized payment method.

Their purpose was to democratize, speed up and reduce the fees associated with the transfer of value by getting rid of intermediaries and middlemen.

Instead, a decentralized network is maintained, as we mentioned before. This is where the ledger aspect comes in, as anyone can download it in its entirety or check individual records from each block of the blockchain.

Ethereum, coming after Bitcoin, expanded a bit further in terms of what it is capable of doing. It arguably played a large part in the modern cryptocurrency scene and helped push forward the development of new projects and trends.

Speaking of trends, one such example is DeFi.

DeFi – Decentralized Finance – is the probably the biggest trend in the industry right now. This utilizes smart contracts, essentially an automated transaction protocol to quickly and trustlessly execute transactions.

As you can imagine, this is where the massive potential for the payments industry is, and why many use smart contract-compatible blockchains like Ethereum to build their payment solutions.

Looking back at the strengths of blockchain and cryptocurrencies, there are some obvious overlaps between the needs of the payment industry and what blockchain technology can offer.

Let’s look into that now.


As always, whenever money is involved, a high level of security is necessary. Who would want to risk losing their money?

What the blockchain offers here is immutability. This refers to how it cannot be changed or tampered with. This is possible thanks to the very nature of the blockchain as a decentralized ledger.

Remember how it is not possible to change data in a stored block without changing every other block in the chain?

Anyway, it is worth noting that security in not 100% impenetrable. There are still some potential weaknesses in the technology, or rather some vulnerabilities.

Saying that, if properly accounted for, these risks can be smaller than the alternatives. Just something worth noting.


I think it’s fair to say that bank transfers aren’t the fastest solution in the world. Trying to send something quickly when a holiday is coming up? That’s a pretty stressful experience.

Thankfully, blockchains are global in scope. The decentralized aspect comes into play here once more as it’s not tied down by any single entity or country, meaning holidays and time zones are not an issue.

At the same time, the lack of centralized third parties in the transfer process also reduces the time taken.

Put simply, the blockchain enables faster payments, being up to 96% faster than traditional bank payments.


Speaking of global bank transfers, the fees associated with making transfers worldwide can get really costly. If your company is making global business payments frequently, then it quickly starts to add up. Thankfully, we have an effective cost-cutting measure at hand.

With blockchain, these fees are reduced significantly. We once again have its decentralized design to thank for that.

The lack of intermediaries reduces the fees that need to be paid. Additionally, everything is done digitally, meaning no manual work that needs to be accounted for.

As an example, it is possible to transfer Bitcoin for less than $1, closer to 10 cents actually. And Bitcoin is not even the cheapest example either.

Easy to Use

Another huge turn off for would-be crypto users is how daunting it can seem. How does blockchain work? How exactly do I pay for things? As always, this kind of friction in the user experience will cause many to avoid it.

But that doesn’t need to be the case. While seamless is a word that gets tossed around quite often these days, payments using cryptocurrencies are starting to get there.

As an example, crypto credit and debit cards are available. These offer a much easier way of paying using cryptocurrencies like BTC and work well with existing digital payment infrastructure.

There are plenty of ‘on ramps’ into the crypto world too, helped by the numerous exchanges.

As you can see, the technology offers many benefits for both consumers and businesses. The speed, security and reduced costs in particular ensure all stakeholders enjoy better value when it comes to payments.

On top of this, the additional security make it more ideal for security-conscious businesses.

There is, however, one major hurdle to consider: the volatility of the cryptocurrency market.

How big of a hurdle is the volatility of the crypto market?

One of the major turn-offs for cryptocurrencies is their perceived volatility. I say perceived, but it is pretty well documented.

Anyone following the market should be well aware of the current drop in the value of Bitcoin and other prominent cryptocurrencies. This isn’t new for the market, but thankfully the trend is generally going upwards.

It’s no secret that many cryptocurrencies see their value fluctuate significantly in the space of days or even hours. However, we should make sure to get our perspective right.

It was just a few years ago in 2014 that Bitcoin was worth around $350, but today it is closer to $37,000. And, we should be widening our view - there’s so much more beyond just Bitcoin, after all. Looking more broadly, you’ll find a whole market of altcoins: cryptocurrencies other than BTC.

While Bitcoin has become the poster boy for the cryptocurrency market, perhaps fairly when considering its dominance, it’s just the tip of the iceberg. There’s a whole ecosystem of different cryptocurrencies, ranging in quality and size.

Ethereum and it’s Ether coin are one example, but there’s also Cardano (ADA), Ripple (XRP) and more. Together, these represent a sizable portion of the market, and are generally highly regarded. But even they are susceptible to some volatility.

Thankfully, a solution has been developed in the cryptocurrency market to counteract the volatility and provide some stability. In fact, there is a whole selection of cryptocurrencies dedicated to providing stability in the market.

These are known stablecoins.

Stablecoins for payments

Stablecoins generally have their value pegged to real-world assets such as fiat currency (i.e. the US dollar). This means they maintain a stable value that goes up and down based on the value of the currency or asset they are tied to.

Of course, there are a number of different mechanisms, such as algorithm-based stablecoins or even crypto-backed varieties, that help stabilize or limit fluctuations the price of the asset.

Basically, whatever mechanism is powering them, they mostly remove volatility from the equation. This makes them much more attractive for businesses to use and accept for payments.

With all that out of the way, we can start to look into the impact of blockchain in the payments industry. The first question is, what does the current situation look like?

Current state of affairs

As mentioned, blockchain technology and cryptocurrencies have made a lot of progress in recent years. In just the last few months, some major breakthroughs have occurred involving well-known brands. This includes:

Paypal announcing its own cryptocurrency platform back in October 2020, now with the ability to withdraw them to third party wallets.

Card network VISA outlining its cryptocurrency plans, placing a lot of focus on the stablecoin side of the market.

We can’t forget the recent news from El Salvador, either. The country announced that it will officially classify Bitcoin as legal currency, the first country in the world to do so. This is great news for the market, as it recognizes cryptocurrencies as more than just assets.

For the time being, El Salvador will make for an interesting case study. Who knows: if it ends up working out, it could be the start of a trend.

This is all just the tip of the iceberg – there’s a lot going on that is highlighting the growing relationship between businesses and cryptocurrencies.

While this positive news is all well and good, there is still a lot of question about the viability of blockchain in business applications.

Its use for end consumers is growing, but many companies don’t want to or don’t have the means to invest in blockchain developments while there is still so much skepticism.

Perhaps the biggest issue facing the mass adoption of cryptocurrencies revolves around regulations. The blockchain technology itself is not an issue, rather it is the classification of cryptocurrencies.

It seems that every country has their own take on the legality of crypto and whether it is a means of payment or just a commodity.

As you can imagine, this is difficult to predict, and so it’s understandable that businesses are holding off.

Are blockchain payments on the cards for businesses?

There is no saying how the future will turn out. In such a dynamic industry as FinTech, where disruption through new technologies is commonplace, there’s a constant battle between cost, speed and regulation.

That last point is a contentious issue, as regulations surrounding Bitcoin and other cryptocurrencies is always changing.

While some have been welcoming to digital currency, other countries have banned it outright. There’s plenty of middle ground there too.

Then there is the safety aspect – any activity involving the exchange of money should follow the strictest security protocols.

Education may be a hindrance here as well, but the innate security mechanisms of the blockchain prove their worth in this area.

Of course, another big draw here is the reduced costs associated with blockchain-based transactions.

Sending money across borders almost always comes at a cost, and a pretty steep one at that. Cryptocurrencies ignore country borders, being truly digital, and therefore global.

So then, how viable is the adoption of blockchain and cryptocurrency technology in the business payment world?

Based on current trends, it does seem to be an inevitability. To what extent? There are a lot of variables at play.

Many countries are slowly moving towards the adoption of mobile payments right now, while places like China have already seen high penetration of this. Could we see a similar localized usage for crypto in these early stages? With what we've seen in El Salvador, it appears that way.

It seems to be a case of building trust, stability and a strong product that fits the needs of the corporate payment market.

Some are doing just that, with others seeing success in the consumer-side payment market.

In the end, it probably won’t be as drastic as a change many people made it out to be, or perhaps hoped for it to be. Rather, we'll see a slow progression and incorporation of blockchain technology into the business payment realm. But could 2022 be the year cryptocurrencies explode?

For more interesting insights into the world of B2B payments and more, subscribe to the AirPlus Global Blog so you don't miss out.


[i] Banner photo by JJ Ying on Unsplash


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