In a recent article, Forbes stated that the global banking sector is experiencing considerable pressure from a new generation of technologies that are empowering an entirely novel breed of banks and average clients. Blockchain technologies have allowed cryptocurrencies and other digital assets to become an acceptable means of payment. Some global names like Walmart, Tesla, Microsoft, and Burger King accept Bitcoin and other cryptocurrencies.
The widespread popularization of cryptocurrencies is notable on a global scale. As of 2021, global crypto ownership rates stood at an average of 3.9%, with over 300 million crypto users worldwide. Over 18,000 businesses accept cryptocurrency payments, allowing holders of such digital assets to leverage their value for everyday needs through specialized cards tethered to bank accounts and digital wallets on the blockchain.
According to the company's proprietary Global Crypto Adoption Index, other estimates given by Chainalysis estimate that cryptocurrency adoption has grown by 880% over the past year. Much of the adoption activity has taken place in emerging and frontier markets that have concentrated activity on Peer-to-Peer marketplaces, exchanges, and the capabilities of the decentralized finance, or DeFi, sector.
Another report by Chainalysis suggests that at the end of Q2 of 2021 total adoption score stood at 24, showing that global adoption has grown by over 2,300% since Q3 of 2019 and by over 881% in the last year. The data presented in the research suggests that the reasons for such increased adoption differ around the world. Many users turn to cryptocurrencies to preserve their savings in the face of currency devaluation, send and receive remittances, and carry out business transactions when it comes to emerging markets. Over the last year, crypto adoption in North America, Western Europe, and Eastern Asia has been powered largely by institutional investments focused on services catering to broad audiences of users in gaming, DeFi, and other sectors with high turnovers.
According to another survey, India ranked second in cryptocurrency adoption, with a user base of 7.3 million, while Vietnam ranked first with 20% of the respondents claiming to have purchased Bitcoin in the last year.
Impact on Banking
Such broad adoption of digital currencies directly impacts the banking sector, which is considerably sidelined by the advent of challenger banks. Such institutions are reeling against the established framework of the banking infrastructure and are opting for novel approaches to doing business. Their approach relies on advanced and innovative technologies, specifically the blockchain.
So-called App-banks give their users broad possibilities for interacting with considerably more convenient and profitable instruments for making investments and operating their accounts. The extensive use of DeFi and integration into the cryptocurrency market is giving App-banks the influx of audiences they need to start challenging the conventional framework of the banking system.
Naturally, applying blockchain technologies within the traditional banking infrastructure would be impossible without establishing a bridge between the old and the new. Such bridges are already fielded by a wide range of companies partnering with cornerstone banking system gateways like VISA and MasterCard. Reliance on bank cards and their various iterations in mobile devices and wearables is the bridge binding the blockchain and banking system.
Debit bank crypto-friendly cards that allow holders of digital currencies to use their cryptocurrency portfolios offer such service providers as Embily. It offers clients a convenient means of making everyday payments using VISA-powered crypto bank cards tethered to bank accounts hassle-free with a host of additional benefits.
Embily cardholders can take advantage of instant crypto transfers, zero commissions for payments and cash withdrawals through ATMs, or access to the Over-the-Counter (OTC) service. Businesses can also take advantage of the Embily financial service by making bulk purchases of cryptocurrencies at low commissions.
The banking system relies on the convenience of its users, and modern times show that their clients find cryptocurrencies usable. Blockchain adoption maintains its pace, and blockchain-powered banks may soon catch up with such service providers as Embily in the battle for clients.
The Digital Transformation of The Banking Sector https://eu.embily.com/blog/the-digital-transformation-of-the-banking-sector
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