Pay and dump? How businesses accepting crypto payments influence adoption
Cryptocurrency enthusiasts often argue that businesses need to start accepting crypto as payments for adoption to grow — boosting usability and potentially creating strong demand for these currencies.
Some crypto communities often focus heavily on growing business adoption, with maps now compiling businesses worldwide that accept different cryptocurrencies as a payment method.
But if a business accepts cryptocurrency payments only to dump them on the market, it may undermine the entire effort, as the assets are just being sold back on the market right after payment.
Moreover, a business accepting cryptocurrency payments through a third-party processor isn’t adhering to the cryptocurrency ethos of managing their own private keys, meaning controlling their wallet fully.
On the flip side, proponents argue that the mere act of enabling cryptocurrency payments opens up new avenues for consumers to transact in crypto, bringing in a new, long-awaited use case.
On its surface, a business accepting cryptocurrency payments would boost adoption. Still, if the digital currency received is immediately sold back on the market, it’s generating as much demand as it is supply. This simultaneous buy-sell cycle may not significantly contribute to cryptocurrency adoption.
Additionally, it isn’t clear how relevant a business accepting cryptocurrency payments can be for actual adoption, as users are unlikely to go through the process of buying cryptocurrencies if they can just pay in their local fiat currency.
The essence of adoption doesn’t merely reside in the act of acceptance by businesses; it fundamentally lies in the ease of access and willingness of consumers to transition to cryptocurrencies for their transactional needs.
A study by leading
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