Travel is truly an international business and travel providers are accustomed to their products and services being available on a global scale. That scope of availability means providers and online travel agencies need to accept forms of payment that are popular and easily accessible. Credit cards such as VISA, MasterCard and American Express are the mainstays when it comes to online payment acceptance and the majority of businesses in the travel marketplace utilize these brands of charge cards. While credit card usage continues to rise, so does the adoption of cryptocurrencies as consumers seek a global currency alternative. Big travel markets are represented in The 2022 Global Crypto Adoption Index as India and the United States log in at numbers 4 and 5 while Russia and China round out the list at 9 and 10. Today’s technology can provide conduits for travel businesses to accept and manage popular cryptocurrencies such as Bitcoin and Ethereum, which could attract a new group of clientele.
Cryptocurrencies Are a Technology Driven Asset
The flagship cryptocurrency Bitcoin just surpassed the $65K mark, setting new price records and suggesting that these ‘digital assets’ may be much more than a passing fad. But what exactly are cryptocurrencies and how do they exist in the financial world? The core of the technology is based on a database called a blockchain. This is a publicly accessible ledger which displays each transaction in succession within the currency’s individual ecosystem. Entries in the cryptocurrency’s blockchain cannot be erased or edited which is intended to add a layer of security and confidence among users of the ‘coin’. For additional security and ecosystem integrity, blockchains have ‘nodes’ that lead to individual private computers. The users at the nodes perform checks and verifications of transactions as well as vote on administrative concerns. Consumers that adopt cryptocurrencies must also engage certain technologies such as managing online or physical digital wallets that store and secure currency ‘hashes’ that identify the owner and amount owned of a particular asset. Purchasing in cryptocurrency also requires some user intuition as hashes and processes can be complex and transactions are irreversible.
Digital Assets Streamline The Payment Process
OTAs and travel providers that accept any of the major credit cards are required to pay fees that can range from 1.5% to 5% of the total transaction. Online travel marketers have no other options as online payments are traditionally completed with a major credit card. The evolution of cryptocurrencies and the technology around them now allow merchants to deliver another method of payment to their clientele that completely eliminates ‘middle-man’ charges. Cryptocurrencies are a peer2peer technology and payments and deposits are made directly between users and do not transfer through a banking institution or other currency holding facility. On larger purchases, this peer2peer process can save hundreds of dollars on each transaction. The consumer facing process can also be simplified with technology by providing intuitive interfaces that allow clients to easily enter information correctly to complete the transaction. Accepting cryptocurrencies does not require any new software or major changes to existing consumer portals and travel providers can quickly adopt the ability to conduct business with digital assets.
Cryptocurrency is Real World Payment Solution
Popular digital currencies such as Bitcoin, Ehtereum and Solana are traded daily and prices fluctuate depending on technical and fundamental market inputs. Innovative market technologies can display dynamic pricing for product and services that is based on real time valuations at the time the display request is made. Technology can allow the clientele to view pricing in the cryptocurrency of their choice (based on which assets the provider decides to accept) and see up to the minute pricing. The back end of the technology will use a referred set price in the provider’s home or desired fiat currency and make instant and dynamic calculations to convert pricing to the chosen crypto unit. Major OTAs such as CheapAir.com and Bitcoin.travel utilize this type of technology to offer the best and most up to date pricing to their customers.
A Global Currency for a Global Business
When Bitcoin first came on the scene, users would be able to accumulate these ‘digital coins’ for free through faucets and performing small online tasks. The flagship cryptocurrency recently surpassed a unit price of $65,000, setting new records on a daily basis. To say adoption of cryptocurrencies continues to surge is an understatement. Thes digital assets have shown resilience in the face of market turmoil and governmental regulation and are here to stay. Travel, being the global market that it is, can utilize technology to accept global currencies such as Bitcoin and Ethereum. Software and interfaces can simplify the process for clientele that utilize digital assets and potentially increase market presence in areas where credit card penetration is low. Adoption and acceptance of cryptocurrencies by travel providers provides another marketing tool that can be a differentiator from market competitors.