Author: Syedur Rahman
28 July 2021
2 min read
The rising popularity of Bitcoin is reflected in the fact that many businesses now accept it as a viable payment method. And while it is unlikely that it will soon be accepted by all shops, there are many who believe that this is the inevitable next step.
This view is supported by news that has just emerged that e-commerce giant Amazon is ‘definitely’ looking to accept Bitcoin payments by the end of the year. Amazon is also planning to launch its own native crypto token in 2022. Although no official sources have confirmed the information, the story broke after Amazon published a job advert for a cryptocurrency/blockchain role, seeking someone who can “leverage domain expertise in blockchain, distributed ledger, central bank digital currencies and cryptocurrency”.
It is becoming clear, therefore, that despite the risks, Bitcoin is becoming mainstream. The adoption of Bitcoin by PayPal, Mastercard and BNY Mellon, amongst others, has given it newfound sources of credibility and legitimacy. Even some law firms are marketing their cryptocurrency payment capabilities in line with their growing digital currency practices.
The murmurings regarding Amazon and Bitcoin appear to be not too much more than rumour, at this stage at least. But if the plans that Amazon reportedly has come to fruition, this will be a massive step for cryptocurrency, marking a significant milestone in its development.
Cryptocurrency has changed the way the general population thinks about payments and investments - and Bitcoin is the leader of the cryptocurrency market. Crypto was once considered a novel and bewildering blip, whose high-risk, volatile and speculative nature would mean its time in the spotlight would pass. Many never really expected it to catch on.
However, more than a decade after its creation, Bitcoin and digital currencies in general remain at the forefront of emerging technologies and consistently dominate the headlines. Long gone are the early days of Bitcoin, where it traded at $1 per BTC. At its new peak, the cryptocurrency traded at $63,729.50 per BTC on 13 April 2021.
With its increasing popularity in recent years, it is theoretically possible that cryptocurrency could become more popular than physical currency. Crypto takes away the problems of modern banking, with the removal of transfer limits and the reduced likelihood of hacking. Additionally, there are comparatively low (to zero) transaction costs associated with cryptocurrencies. It is also highly accessible for users as there is no need to supply ID documentation for a crypto wallet account, unlike the procedure for setting up a traditional bank account.
However, it is likely to take years for cryptocurrencies to replace fiat currency altogether. Such a substantial change will require the development of solutions to many regulatory/legal, technical, and economic issues posed by crypto.
One way in which crypto’s move to the mainstream could be achieved is through the use of ‘stable-coins’. These coins are in a better position to become more popular than physical currency in the shorter term, as they are able to provide all the benefits of digital currencies, but without the volatility. Their value is designed to be linked to an underlying asset (such as gold, or ‘normal’ currencies such as the pound). Therefore, unlike Bitcoin, whose value can fluctuate greatly with just a single tweet from Elon Musk, the valuation of stable-coins is free from dramatic fluxes.
But whatever happens in the coming years, it certainly appears that crypto is on its way to the mainstream.
Syedur Rahman is known for his in-depth experience of serious fraud, white-collar crime and serious crime cases, as well as his expertise in worldwide asset tracing and recovery, civil recovery, cryptocurrency and high-stakes commercial disputes.