The credit card system currently used in America is getting old. Billions are spent on avoidable transaction costs every year. Coinbase came out yesterday (February 7, 2024). an interesting report.
Crypto exchange report shows shocking results
Coinbase is one of the largest crypto exchanges in the world. It produces crypto-related reports four times a year. The report from the last quarter of 2023 deals with an interesting topic. Research shows that Americans are increasingly dissatisfied with the current payment system.
Currently the costs for a transaction are very high. This is partly because there are many intermediate steps. The bank itself charges a commission (often entry costs + a percentage) and there are also switching costs.
When expressed in numbers it becomes even clearer. US credit card users will spend at least $74 billion on transaction fees in 2022. Coinbase points out in its report that almost all of these costs could be avoided by using a blockchain.
On the other hand, merchants pay $126 billion annually to process credit card transactions. These costs are mainly due to additional steps (which are unnecessary with cryptocurrencies).
Not only the different costs, but also waiting times and opening times play a role
Other advantages of crypto over the current system are the waiting times. While people have now become accustomed to the speed of the Internet, many banks still operate in an “old-fashioned” manner with opening hours, a difference between weekends and working days, and additional delays in international transactions.
Nowadays people are used to the speed of the internet; Available 24/7 and a response within seconds. However, many banks still operate with opening hours and weekend days.
The report shows that 70% of Americans want faster transaction times. For Americans who own cryptocurrencies themselves, this percentage is even higher; 90%. This group knows that a transaction with a blockchain can be made within seconds, while a waiting time of one to six business days at a bank is not uncommon.
From older reports Coinbase shows that more than half of Americans ages 18 to 40 have little or no use of the traditional system. It also appears that most Fortune 100 companies are developing payment systems that use blockchains. This offers a positive vision of the future where transactions become easier, faster and cheaper.
