Why some corporations are struggling with crypto payments
3 Min Read
Tesla, Dell, and KFC are among some companies that abandoned their pursuits of acquiring crypto payments for products.
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Bitcoin's long processing time makes it an unlikely pick for payments
Companies that initially showed interest in accepting Bitcoin as payment for its goods have now retracted their positions due to Bitcoin's unstable value.
The half an hour processing time is another reason why it is more impractical than other forms of payment.
South African developer and crypto expert Andre Cronje told AFP that "no one's going to walk into a KFC to buy a chicken burger and then have to wait 30 minutes for a payment."
However, other cryptocurrencies have more stable prices and faster processing times, and experts say the total market value has topped $2 trillion.
Microsoft has taken an approach that keeps its shareholders unexposed to the fluctuating crypto prices, while PayPal and Apple have made similar promises to shareholders.
To keep cryptocurrency off its financial sheet, Microsoft teamed with Bakkt, a company that allows clients to convert crypto assets into items such as Xbox gift cards or charge their Starbucks payment card.
Bakkt, went public last year, and a flurry of major collaboration announcements with companies such as Mastercard drove its share price skyrocketing.
But then it took a plunge as it announced rising losses and its operations were scrutinized.
Meanwhile, PayPal has received a lot of attention for its "checkout with crypto" option, which was released in the US and UK last year.
PayPal's mechanism transforms customers' crypto-assets into money before transferring funds to suppliers.
However, market watchers believe it is too soon to tell how the future will look.
John Freeman of CFRA research said his view is "to not get too excited yet but just watch the jockeying."
Developer Cronje said using services like BitPay and BitRefill allows crypto to be spent anywhere from Amazon to Uber.
However, he admitted that his less tech-savvy pals would go broke "very quickly" if they relied on the blockchain, the technology that powers cryptocurrency.
Instead, he sees a future in which consumers continue to use credit cards and banks, but back-end functions are mainly automated on the blockchain.
"This is a technology that conservatively is going to save them between 20 percent and 25 percent of their overheads and their costs," he stated.
The Pavilion hotels chain stated that after partnering with a payments firm last year to enable customers to use cryptocurrency, they found no difference in their business.
Tim Sargeant, the Pavilions spokesman told AFP that it seemed bitcoin was more of "an investment tool than something people wish to part with for payment."
