Sunday was Bitcoin Pizza Day, an annual crypto industry holiday commemorating bitcoin’s first known use as a payment currency.
For starters, it’s a lot easier to do on the 12th anniversary. It really started to get easier last year, when Visa announced that more than $1 billion had been spent on crypto cards from companies like Coinbase and BlockFi.
And, while it’s usually celebrated by trying to find a pizzeria that accepts cryptocurrency payments and reminding the buyer how rich he’d be if he hadn’t traded 10,000 bitcoins for two large pies in 2010, this year was different.
But with debit cards from Visa and Mastercard that spend in crypto but pay in fiat growing more common, it seems likely that by next year, Bitcoin Pizza Day won’t involve much of a scavenger hunt at all.
Still, most of that was via gift cards and those exchange-issued debit cards that spend in crypto but pay in fiat. Which arguably isn’t a case of bitcoin really fulfilling its original purpose as “purely peer-to-peer version of electronic cash would allow online payments to be sent directly from one party to another without going through a financial institution.” Bitcoin has largely been used — and usable — primarily as an investment.
Simply put, 2022 is the year that paying by bitcoin — and other cryptocurrencies — started gaining some mainstream traction. An April study by PYMNTS and BitPay found that 23% of U.S. consumers — nearly 60 million — had owned crypto in the past 12 months.
And while its price collapse, on what may be the beginning of a potentially steep recession, has left bitcoin’s reputation as an inflation-proof store of value somewhat tattered, its utility in payments has grown enough that it isn’t just hardcore industry insiders who can spend it. Indeed, 14% of those crypto-using consumers now say they actively bring business to merchants who accept crypto. And it’s getting easier to do.
“We are here to enable customers, merchants and businesses to move digital value — traditional or crypto — however they want,” said Raj Dhamodharan, who heads up Mastercard’s blockchain and digital products, when the payments giant announced in February it would support several cryptocurrencies directly on its network. “It should be your choice, it’s your money.”
Bitcoin Payments Growing Still, the number of merchants who directly accept crypto remains small, even though it is growing.
But that isn’t really shocking, or even surprising, anymore. PayPal added the ability to pay in crypto to its 32-million strong merchant network in 2020, and Block’s Cash App has been doing that since 2018. Companies like BitPay, Binance Pay and Coinbase Commerce, are making it easier for merchants to accept crypto directly. “I think in 2022, you’ll see many more people — that next wave of people — [saying] ‘Let’s try it for a payment,’” BitPay CEO Stephen Pair said at the start of the year. “There’s going to be many more places with that service — that you’ll be able to spend crypto and do it in an in-person setting, which may make people more comfortable trying it out than perhaps if it’s on a website where they’re not sure if they’re doing it right or wrong.”
That said, just four months earlier, Pair noted that getting merchants onboard is about more than the technology. Speaking when BitPay announced a deal with payments technology firm Verifone in September 2021, he said that merchants were still wary of crypto’s volatility. More Choices
A big announcement came on April 7, when Strike CEO Jack Mallers announced that it has made deals with Shopify, prepaid payments provider Blackhawk Network and — possibly most importantly — top global point-of-sale terminal maker NCR to accept bitcoin payments. Like Jack Dorsey’s CashApp, Strike is using the Lightning Network, a Layer 2 blockchain that sits on top of bitcoin, making transactions much faster and cheaper, to make that feasible. A report in April found that payments made via the Lightning Network are up 410% this year.
Twitter has pushed ahead, partnering with payments firms Strike and Stripe to make it possible to give tips and pay content creators in bitcoin and the USDC stablecoin cryptocurrencies. And the crypto exchange Coinbase allows its Wallet users to have paychecks direct deposited. The most recent example of crypto’s usefulness as a way of paying for goods at retail was news on May 17 that the Crypto.com exchange’s Crypto.com Pay gateway had struck a deal with Shopify that will let its 1.75 million merchants accept crypto at their online storefronts.
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