At its most basic description, sustainable means being able to be maintained or kept going. The borderless nature of crypto makes it one of the most adopted systems that find its usefulness as a financial solution across many frontiers. However, for it to be considered a sustainable payment solution, we must first look at its pros and cons as a payment solution.
Is Crypto a Sustainable Payment Solution 2024?
Pros of crypto as a payment solution
• Less bureaucracy: Crypto as a payment solution eliminates the need for external influence. Users can interact on a peer-to-peer level, facilitating greater trust and improving the payment experience.
• Increased speed: Unlike traditional institutions that take several days to process a cross-border payment, cryptocurrencies do the same job in minutes. It provides an effective way for people to send money from anywhere in the world faster.
• More access: Crypto is an intercontinental currency, i.e., it is not limited to one country. This feature allows more consumers to access goods they would otherwise have been unable to pay for.
• Better security: Payments through blockchain, the technology crypto is based on, protect providers and consumers. Consumers can confirm the authenticity of a product, while providers can be sure about receiving payment.
Also Read; Crypto Payments for Cloud Services: What to Expect
Cons of crypto as a payment solution
• Volatility: One significant feature of crypto is its volatile nature. The price changes that are constantly fluctuating can make providers of goods wary of accepting it as a payment solution.
• Permanence: Once a crypto payment has been made, it is practically irreversible. Thus, when a payment is made, a consumer cannot simply walk to a physical site to ask for a reversal of the funds transferred.
• Tax implications: Transactions made in crypto incur taxes that can be high depending on the fair market value at whatever time it was received.
Bottom line
When something is strong enough to continue existing or happening for a long time, such a thing is said to be sustainable. For crypto to be a sustainable payment solution, it has to go beyond its proof-of-work mining process to a more eco-friendly nature. Crypto’s environmental impacts are frowned on, limiting its adoption among eco-enthusiasts.
This makes it not so different from traditional banking systems that consume electricity in terms of ATMs and corporate offices. By changing the process of producing cryptocurrencies, energy consumption from mining will reduce considerably. A blockchain platform like Ethereum is currently tilting to a sustainable method of making crypto through proof-of-stake.
This method of producing cryptocurrencies can make it stand as a sustainable payment solution.
