That’ll be 0.0021 Bitcoin, thanks. Photo: Shutterstock
Weeks after the Reserve Bank of Australia (RBA) announced trials of an official cryptocurrency, a new retail venture will let Australian crypto holders buy petrol, coffee, doughnuts, and other goods at 175 shops without converting the crypto to fiat money first.
The world-first service, announced by tech company DataMesh Group and OTR, will allow customers of OTR’s 175 fuel and convenience stores – 24×7 operations spread across Victoria, SA and WA that include Krispy Kreme, Hungry Jack’s, Oporto, Subway, and other brands – to pay for their purchases straight out of their Crypto.com wallets.
Enabling the payments required an upgrade of the outlets’ DataMesh payment terminals, which display a QR code that customers scan with the Crypto.com app on their phone.
Payment is taken from the customer’s Crypto.com wallet in cryptocurrency, then settled by Crypto.com’s Pay Merchant gateway, which was launched in Australia in April and enables real-time transactions by converting between 25 different cryptocurrencies.
Pay Merchant converts the cryptocurrency to AUD and deposits it into the merchant’s account in real time.
OTR parent company Peregrine also plans to roll out the capability to another 250 retail sites, including Krispy Kreme stores in SA and the Northern Territory.
Customers who pay with crypto will be given a 2 per cent cashback incentive through 16 September.
Enabling direct cryptocurrency payments for its goods and services “is about giving customers choice and making life easy,” Peregrine Corporation executive chairman Yasser Shahin said in announcing the new payment option, adding that “the decision to offer cryptocurrency payments is centred around this story by offering our customers convenience in how they pay.”
A newly released survey of over 2,000 Australian consumers and 500 merchants, conducted by PureProfile and sponsored by Crypto.com, found that 55 per cent said they wanted to be able to transact in cryptocurrency – primarily in Bitcoin and Ethereum – and a third wanted this to be possible for in-store purchases as well as online.
A third of surveyed merchants said they are ready to transact using cryptocurrency, or will be ready within a year, while 60 per cent said they would be ready within three years.
Normalising crypto at last?
The introduction of direct cryptocurrency payments for everyday purchases marks a significant step in the maturity of cryptocurrency, whose wild fluctuations in value have made it both an investor’s darling and an economist’s nightmare.
Bitcoin’s surge past $28,800 ($US20,000) in 2020 had advocates claiming the currency was gaining favour as an alternative to gold, with startups promoting the idea of buying houses with crypto and Tesla’s massive Bitcoin investment helping triple its price.
Enthusiasm ran hot until a correction last year was exacerbated by this year’s global disruption – exploding the Bitcoin miracle as the cryptocurrency lost five years of gains, driving Tesla to dump most of its holdings.
This instability led the Reserve Bank of Australia (RBA) to last year declare that cryptocurrency would never be legal tender for day-to-day purchases in Australia – yet even that resistance is easing, after the RBA this month announced that it will soon partner with the Digital Finance Cooperative Research Centre (DFCRC) for a year-long trial of a government-backed central bank digital currency (CBDC).
Because they are official financial instruments and backed by the government – the Australian Treasury is participating in the new trial – CBDCs avoid the instability of conventional cryptocurrencies, which is why they were this year backed in an executive order by US President Joe Biden.
That support makes them appealing alternatives to conventional cryptocurrency that could be widely adopted as a lower-risk form of payment, enabling the ubiquitous rollout of point-of-sale payments like those that Peregrine is now offering.
“CBDC is no longer a question of technological feasibility,” said DFCRC CEO Dr Andreas Furche. “The key research questions now are what economic benefits a CBDC could enable, and how it could be designed to maximise those benefits.”
Despite Bitcoin’s recent slump, the cryptocurrency sector continues to win support from across the tech sector – with one recent analysis finding that major companies ploughed over $8.6 billion ($US6 billion) into blockchain, crypto, and web3 startups between September 2021 and June 2022.
The Commonwealth Bank of Australia’s investments in Lygon, Xpansiv, and Gemini helped it rank ninth on the list of biggest investors, just behind Microsoft and ahead of financial-services bellwethers like Citi, Wells Fargo, and American Express.