Cashless payment methods are on the rise as governments step up central bank digital currency initiatives, according to a new report based on a survey by the Economist Intelligence Unit, commissioned by cryptocurrency exchange Crypto.com.
Fast Facts:
- Preference for digital transactions and currencies has risen this year, with Covid-19 accelerating the trend to cashless, according to the EIU. The EIU report was based on consumer and executive surveys conducted through February and March this year of more than 3,000 consumer and 200 institutional investor and corporate treasury management respondents across Asia, Europe and North America.
- Cryptocurrencies — in particular open-source ones such as Bitcoin — are the best-known among consumers, with 55% of consumers saying they were aware of them even if they have never owned or used them. CBDCs were the least recognized form of digital currency.
- The majority (76%) of corporate treasury and institutional investor respondents said Covid-19 had accelerated the adoption of digital currencies. Institutional investors appear to be using digital currencies more as a store of value with a deflationary hedge and for portfolio asset diversification than purely as a settlement option.
- “As a notional ‘digital gold,’ cryptocurrencies can hold similar patterns in terms of limited supply, being authenticatable and dividable, and providing a level of diversity in asset allocation and value storage,” the report notes. “However, regulatory, trust and technological understanding concerns linger.”