Cryptocurrency has been around for a while and has seen a boom in recent years. Many have already acquired a fortune in terms of digital assets. Since crypto is still not a widely accepted payment option, there's not much to do with it, unless you have enough to buy a Ferrari.
Using Crypto to Buy a Real-Life Vehicle
Currently, cryptocurrency is still at an early stage since it's basically just an asset you wish would grow and cannot spend. All a person can do is buy it at a lower price, wait for its value to increase, and sell it for more. However, businesses are slowly starting to accept crypto as payment.
One of those businesses is the famous car manufacturer Ferrari as it now accepts crypto as payment, specifically Bitcoin, Ether, and USDC. The company is working with BitPay for the payment method, which is already available in the US.
Other places like Europe are still months away since it is expected to adopt the same method in 2024, as reported by Engadget. Other regions where the car manufacturer is operating will likely follow Europe as it expands the alternative payment option.
Ferrari Chief Marketing and Commercial Officer Enrico Galliera says that the company accepting BitCoin and other cryptocurrencies is a way to reach "people who are not necessarily our client but might afford a Ferrari."
Since the digital currency is still not as stable as businesses and companies hope, BitPay will immediately convert the crypto payments into traditional currency the moment the transaction is complete. This avoids the possibility of the company getting less than what the purchase was worth.
Data Shows BitCoin is Barely Used as Currency
It's nice that cryptocurrency is finally used for some purchases, but it's still not even close to how much traditional currency is used. While a lot of people already have digital assets in the form of crypto, most of the world still sees it as nothing but a fad.
The point of cryptocurrency, specifically Bitcoin, was for it to be used as "a purely peer-to-peer version of electronic cash" that would "allow online payments to be sent directly from one party to another without going through a financial institution."
According to The Conversation, the number of people currently holding digital currency is around 10% to 20%. A survey conducted by the Reserve Bank of Australia shown in the June 2023 report shows that cryptocurrency is only being used by 2% of adults.
Mostly, the problem still lies in its volatility. The fluctuations in value are so frequent and unpredictable that businesses would constantly have to update their prices to match the current value. It could also become a loss once the value decreases after it was used as payment.
While this dilemma was supposed to be solved by the creation of stablecoins, that also proved to be a disaster after the fall of Terra. Crypto firms are yet to figure out how to actually make stablecoins "stable," or just all cryptocurrencies in general.
