—TechRound does not recommend or endorse any financial, investment, gambling, crypto, trading or other advice, practices, companies or operators. All articles are purely informational—
Over the past few years, cryptocurrencies have been used in an increasing number of ways, even in mainstream areas like travel and retail. As crypto becomes more common in finance, more businesses are beginning to utilise it for their products and services. This is one reason why crypto is becoming more usable.
Now, by using exchanges like Kraken to buy Bitcoin, travelers may be able to pay with crypto and make use of its speed, security and flexibility.
Growing Use of Crypto in Travel Payments
As travel climbs back up to pre-pandemic levels, a rising number of travelers are calling for more payment methods, especially those that would cater to today’s larger population of tech enthusiasts. This growth coincides with the general increase of crypto adoption rates worldwide, further expanding the demand for greater payment flexibility.
In response, some travel agencies have begun to accept digital assets, especially as stablecoins, whose value is pegged to fiat currencies like USD, are now more widely available. Online travel agencies (OTAs) are currently the leaders in using cryptocurrency in the travel industry. This is partly because cryptocurrency is decentralised, which means that travelers can book flights, hotels, and other services from anywhere.
Some major airlines have also begun to accept popular cryptocurrencies like Ethereum and Bitcoin, both of which can be exchanged on platforms like Kraken, to pay for tickets, in turn giving travelers more options when checking out.
Benefits for Travelers and Service Providers
Using cryptocurrency as payment has a number of benefits for both travelers and service providers. This is why it is becoming more popular and widely used by both groups.
One of the best things about it is that it cuts down on exchange fees and conversion problems, which can happen when you use fiat currencies in other countries. As Coinspaid explains, “Cryptocurrency transcends borders, making it ideal for international customers,” adding that “this seamless cross-border functionality opens doors for travel agencies to cater to a broader audience and remove friction from international transactions.”
Crypto transactions are also processed significantly more quickly than traditional ones, allowing for more convenient user experiences and circumventing the transaction fees that come with going through intermediaries like banks. In turn, travel agencies receive payments faster while customers spend less time waiting for payments to process.
Service providers, in particular, benefit from the security and lower risk of chargebacks or fraud that come with using blockchain technologies like cryptocurrency. Blockchain is inherently built with security and transparency features that can help travel agencies lower the challenges that come with credit card payments. Agencies have more financial security because confirmed cryptocurrency payments can not be undone.
Significant Examples and Market Changes
Many crypto payments in the travel industry go toward low- to mid-level trips. The luxury industry has also seen a lot of crypto use, as it often handles big transactions. High-end travel agencies can process these transactions faster, safer, and more privately with crypto than with regular money. This ease will probably keep attracting more high-value customers.
Specialty tour companies that offer niche services like eco-tourism also use crypto. In these instances, providers accept crypto as a means of attracting more environmentally conscious, tech-forward travelers who see blockchain’s decentralisation and transparency as part of a commitment to sustainability.
Challenges and Regulatory Considerations
Although it carries a number of valuable advantages, crypto is by no means a perfect payment solution. As always, crypto is inherently volatile and can quickly rise or fall in value over the course of a day, sometimes drastically so. This volatility can make the value of one’s crypto somewhat uncertain, which is why stablecoins are popular in these situations.
Another important thing to think about is regulatory uncertainty. This is because laws about crypto can be different in different countries, which can change how crypto can be used in a certain place. Also, laws about crypto taxes are still not very clear, which is why some travelers are hesitant to use it without knowing what will happen if they do.
Despite these concerns, adoption persists worldwide, especially in crypto-forward locations where regulations are notably friendly toward cryptocurrency as a payment method.
Cryptocurrency and Its Outlook for Travel
In the last few years, a lot of people in the travel industry have started using cryptocurrencies, but there are still a lot of markets that have not yet adopted them, which means there are still a lot of chances for more crypto use.
As the crypto industry grows and Web3 and other technologies become more common, it may be possible to plan trips in the future on decentralised platforms, either in part or in full. In doing so, travel agencies would be able to offer decentralised loyalty programs for frequent travelers or even implement NFTs as digital passports or tickets.
Using cryptocurrency as a payment method is already an impressive step toward improving accessibility, but with the advent and widespread application of technologies like smart contracts, Web3, or even decentralised autonomous organisations (DAOs), there is no telling where the travel sector could go next.
—TechRound does not recommend or endorse any financial, investment, gambling, crypto, trading or other advice, practices, companies or operators. All articles are purely informational—
