If you talk to someone who's new to crypto, chances are the first wall you’ll hit is, “can i actually use it in the real world?” Because the truth is, you can believe in the genius of the technology, you can believe in its potential as an investment asset, but it’s often not until you see it being used in the real world that the penny drops.
Throughout the making of the Pennydrop initiative, we heard a variety of reasons why people first began to believe cryptocurrency was the future. The vast majority of these answers were theoretical – “I realised Bitcoin was the future when I understood that it could do this.” But what of the ways that it is changing the world in the here and now? How is it impacting people’s lives on a practical level, solving problems that you encounter every day?
Payments and purchases
When Satoshi first published the Bitcoin whitepaper, there was a key problem that it solved. One that many others before had looked to solve in their own, failed incarnations of digital case. This is the ‘double spend’ problem – the issue that digital assets are relatively easy to duplicate and use again. The key word here is spend – a verb. Cryptocurrency was built to be used, to add new functionality to cash and improve on the financial system as we have always known it.
This is no longer just a hypothetical. Cryptocurrency has long been accepted by major retailers for a number of years, and this is only increasing. New startups such as Flexa have introduced slick crypto-payments platforms for retailers. More importantly, there are now a diverse array of retailers both big and small, willing to integrate their services. Among them are Whole Foods Market, Office Depot and Nordstrom. Starbucks has also announced that they’ll be integrating Bakkt’s crypto-payment service in the first half of 2020. Starbucks owns almost 30,000 outlets across the world.
We spoke to Vinny Lingham, founder and CEO of Civic. His aha moment was when he realised he could receive payments in cryptocurrency more securely than traditional banking methods.
“I ran a company called Gyft, it was a mobile payment company,” he explains. “When we started accepting payment in cryptocurrency, it meant people could pay us from anywhere around the world and we were guaranteed payment. Before that, we had credit cards, but the credit cards could be reversed and so people could claim there was fraud or people could use stolen credit cards on our service and we would lose the money.
“In the case of Bitcoin, once the coins are sent and we receive them, we know that no one can take them back and we can ship the goods. So, from a global digital currency perspective, the penny dropped for me when I recognised that digital money and the equivalent of being able to pay online without reversibility was the key to building out a crypto ecosystem.”
And it works the other way too, with a number of people seeing it used for a payment method jumping into the crypto market. Sonya Kuhnel, CEO of Blockchain Academy, has her moment when she witnessed someone seamlessly purchase a car without going through a bank. James Lanigan, Head of Marketing at Luno, had a similar experience. He was searching for a black cab on a chilly London evening in 2017. Upon getting into the cab, he discovered that Bitcoin could be his payment method. Manenga Mungandi first understood the power of Bitcoin when he realised he could send money across the world to any country. “I have family across the world,” he explains. “It’s always been really tough to send money to them. This makes it so much easier, and I love it.”
Seeing something you’re not used to, like Bitcoin as a payment method, in a place or situation that you are used to, can really start to make you think. Whether it’s buying a car or paying for a cab, people are starting to realise the uses for cryptocurrencies.
Lorien Gamaroff, CEO of Centbee, remembers reading about it in 2011 in an article about using Bitcoin as a payment method. “That was when the penny dropped because I though, if this can be used in a transactional way, if people can actually use this to buy things online, then this is going to definitely work.”
Is this your moment?
How’s your exploration of the world of cryptocurrencies going so far? Let us know what you think! Maybe you’ve seen the practical applications of it in real life. If so, we’d love to hear about it. Drop us a line with your pennydrop moment on any of our social channels with #pennydropmoment