Crypto Spending on Luxury Goods Jumped in 2021 - BitPay
Crypto payments processor BitPay says that the bitcoin (BTC) payments at merchants who use the company’s services dropped to 65% of all processed payments last year -- a decline from 92% in 2020.
In addition to bitcoin, other assets that generated a significant share of the payments BitPay processed in 2021 included ethereum (ETH), with a 15% stake, and stablecoins, which generated a total of 13%, company representatives told Bloomberg. The increased popularity of stablecoins in crypto payments is partly due to the fact that more businesses have started to use them for cross-border payments.
BitPay did not provide specific numbers. Last April they claimed that the company processed "over a billion dollars a year," meaning that "people are spending crypto." Sonny Singh, the company’s Chief Commercial Officer (CCO), pointed out a difference, however -- that four years prior, 95% of the above number was coming from bitcoin, while that percentage has been falling in the recent years.
A contributing factor to the decrease in BTC's share could also be that BitPay added support for additional coins last year.
Another trend BitPay observed was related to increased crypto spending on luxury goods such as jewelry, watches, cars, boats, and precious metals. The firm’s transaction volumes related to luxury goods expanded by 31% in 2021, Stephen Pair, Chief Executive Officer at BitPay, was quoted as saying. The company’s total 2021 payment volumes increased 57% year-on-year.
Bitcoin price is struggling to mount above USD 43,500 as of pixel time (11:05 UTC), marking the beginning of another rough week for the coin.
With this in mind, Pair admitted that bitcoin’s recent price drop could have an impact on the company’s operations, but that the overall declines in the crypto payments volume were much smaller than the recent reduced volume of luxury spending.
“Our business ebbs and flows to some degree with the price, when the price goes down, people tend to spend less,” he was quoted as saying. Pair added that the company hasn't experienced "as much of a decline in volume" with the recent pullback. "It’s probably just a reflection of more and more companies that need to use this as a tool to conduct payments," he concluded.
CryptoNews
