Published: August 31, 2020
Merchants believe Bitcoin will likely act as a core complement to traditional currency rather than a substitute, offering an alternative option for consumer and merchant investments, expense management, or lending.
Payments Canada and CorbinPartners Inc. today published The Bitcoin Sentiment Tracker - Merchant Study, which looks at merchant perceptions and attitudes towards one of the world’s most popular digital currencies for retail payments - Bitcoin.
Results indicated weak acceptance of Bitcoin as a payment method by retail merchants, unsurprisingly driven largely by lack of consumer demand. However, this is balanced by a positive view towards Bitcoin’s persistence and growth, both as a currency and as an asset, facilitated by an evolving regulatory framework. The study also offers a rich collection of data and first hand opinions from merchants’ varied attitudes towards Bitcoin.
In Phase One of the study, The Bitcoin Sentiment Tracker, released in June 2019, the focus was placed on sentiment from the consumer sector. It showed that while most Canadians were aware of Bitcoin, few owned it. Of those who did, curiosity was the driving factor in acquiring it and not many had used it to make retail purchases, driven to some degree by lack of acceptance, suggesting a “chicken and egg” phenomenon.
The current study further tests that phenomenon and is an ongoing benchmark analysis to gauge perceptions and attitudes towards Bitcoin and other crypto currencies in the Canadian marketplace.
Key highlights include:
- Cryptocurrency is not widely accepted by Canadian merchants. Globally, it is estimated that up to 100,000 organizations accept Bitcoin, while in Canada, Bitcoin is only reportedly accepted as a payment option by an estimated 400 to 500 retail-based businesses.
- Satisfaction levels for merchants using Bitcoin vary considerably. Cost, speed and security topped the list of areas of satisfaction for merchants; while price volatility and public understanding were key drawbacks.
- Bitcoin is the most recognized and frequently traded cryptocurrency. Due to its features and benefits as well as first-mover advantage. At time of assessment, Bitcoin represented two-thirds of the total global market capitalization of cryptocurrency, almost ten times greater than the next in line, Ethereum.
- Merchants are primarily bullish on expected usage of Bitcoin in near future. Over 80% of respondents, including those who do not accept Bitcoin predict moderate to significant growth of the cryptocurrency for retail payments over the next three years.
- Bitcoin-based products and services related to investing and lending to drive advancements of Bitcoin in Canada. Investors indicated they are beginning to use Bitcoin and other various forms of cryptocurrency as a component to more creative investment strategies.
- Perception of safety and security of Bitcoin use divided. Those who currently utilize Bitcoin find its level of safety / security to be a distinct advantage as compared to traditional currency, while those who have yet to use / accept Bitcoin do not have the same comfort level, and perceive this to be a chief area of concern.
- Limited use of Bitcoin can be attributed to a lack of understanding about its attributes and how it operates. More than four in ten merchant respondents identified more knowledge of the benefits of Bitcoin as a primary motivator to begin accepting, slightly higher than the percentage of consumers stating the same.
Outcomes of study have the opportunity to inform use and acceptance of other private and public digital currencies.
About The Study
The Bitcoin Sentiment Tracker is a tracking study of Canadian consumers and merchants who hold and/or transact Bitcoin, as well as those who haven’t adopted this form of currency to date. The findings of the reports uncover valuable information to help better understand current and potential advancement of Bitcoin in Canada.
Over the course of both tracking studies, almost 1300 consumers, merchants, and other industry participants were interviewed and surveyed about attitudes towards the use and acceptance of Bitcoin.
[UPDATE] Since publication of The Bitcoin Sentiment Tracker - Merchant Study, the Libra Association underwent a rebranding to the Diem Association, therefore resulting in the rebranding of the currency from Libra to Diem, effective December 2020.