But digital assets have always served as a lightning rod for consumers.
“What happened through 2022 was a lot of layoffs, companies going under and consumer losses,” Brendan Berry, head of payments products at enterprise crypto provider Ripple, told PYMNTS.
“We are coming out of that period with a healthy skepticism separating what was a large amount of hype and speculative investment driving bull market activity, from real companies and technologies solving real customer pain points,” Berry added.
Because of that healthy skepticism, it has never been a better time to be a “builder” in the space, he said.
“This is the time to roll up your sleeves and create with a focus on driving real utility in contrast to many of the ‘technology in search of a problem’ approaches that we saw during the winter pullback,” he explained.
Crypto and Blockchain for Payments
Research in the PYMNTS report “Cryptocurrency, Blockchain and Cross-Border Payments: Selecting a Blockchain Technology Partner” found that while many businesses see blockchain payments technology as important to streamlining cross-border payments, more than half worry that it comes with regulatory risks.
Berry said Ripple is focused on “enabling value to move at the speed of information,” highlighting that many of crypto’s most enduring real-world utility benefits are within the payments space.
“There’s been significant adoption and interest from businesses [around using crypto to facilitate instantaneous cross-border transactions] that is only continuing to accelerate,” he said.
Berry explained that enterprises aren’t turning to crypto just for the sake of technology, but rather that crypto’s utility “solves for real customer problems.”
As for what those problems are and how crypto can help companies solve them?
“The problems that the promises of blockchain are already delivering on include reducing the cost to move funds, increasing the speed with which you can move funds, increasing transparency, all while increasing the availability of being able to move funds 24/7/365,” Berry said.
Supporting this notion, PYMNTS data showed that there is an ongoing opportunity to provide more education around the use of crypto for payments.
Cross-Border Payments Illustrate Blockchain’s Impact
“The important thing to emphasize is that [blockchain] technology is super nascent; the innovation is just getting started,” said Berry. “We’re at a paradigm now where you can ask, ‘What is it doing?’ And it’s solving real pain points and problems. Cross-border payments in particular are an incredible space where you can see that impact here and now.”
He compared crypto’s runway to an “analogously transformative technology like the internet.” There were many market cycles, but what drove adoption and changed behavior was where the internet was able to solve real problems.
“You’re absolutely seeing that in payments,” Berry said, underscoring how blockchain’s ability to increase cross-border transaction speeds while lowering settlement costs provides a valuable white space opportunity for many enterprises looking to conduct their business abroad.
“Remittance companies in the U.S. alone were responsible for driving about a 350% increase in crypto payments adoption in the last three years,” he said, noting that the remittance space is highly price sensitive and “really impacted” by inefficiencies among other cross-border payment rails.
Still, Berry emphasized that crypto has been adopted more broadly as “large corporations lean in for payroll or paying suppliers.”
“Financial institutions who are trying to move funds for use cases such as treasury, moving funds across their organization or pre-positioning capital — they are seeing utility in crypto,” he said.
Many finance leaders take on behaviors that they don’t realize are inefficient simply because legacy systems are accepted as the status quo.
“Traditionally, the technology infrastructure and systems with which [CFOs or treasurers] rely to move funds internationally result in all sorts of pain points that are passed on to the organization, including inflexibility, slow money movement, among others,” he said.
He said he “fundamentally disagrees” with the premise that enterprises need to accept the present cross-border money movement environment as fact and he is looking forward to building greater education and trust around how crypto solutions can remove frustration and anxiety from cross-border transactions.
