Over the past few years, the cryptocurrency space has grown to become a $2 trillion industry, with millions of retail and institutional investors entering the market over the past few years.
However, the cryptocurrency market went through a bearish run earlier this year. In the second and third quarters of the year, the prices of most cryptocurrencies lost more than 50% of their values. Bitcoin dropped from its all-time high price above $64,000 to below $30,000.
Despite the decline in price during the second and third quarters of the year, the cryptocurrency market continued to gain adoption. The usage of cryptocurrencies grew bigger as more people started to invest in them and use them to pay for goods and services.
Here are some of the biggest highlights to show that cryptocurrency usage and adoption are growing.
El Salvador Officially Makes Bitcoin a Legal Tender
One of the biggest news within the cryptocurrency space in recent months is the official adoption of Bitcoin as a legal tender in El Salvador. The El Salvadorian parliament voted in favor of making Bitcoin a legal tender as far back as June, and the bill went into effect in September. Following this latest development, all businesses in El Salvador are obligated by law to accept Bitcoin as a legal tender if customers wish to pay with it. The government’s Chivo wallet has already been downloaded by a third of the citizens, and more people are using BTC to pay for various goods and services. On its part, the El Salvadoran government has been promoting the use of BTC. The government has partnered with some crypto companies to install hundreds of Bitcoin ATMs in the country. Hence, making it easier for people to buy and sell the cryptocurrency. Furthermore, the government is giving a discount for people that pay for gas with BTC. The government has also invested in BTC, making El Salvador one of the first sovereign nations in the world to hold bitcoins in its balance sheet.
Fintech Companies are Expanding Their Presence in the Crypto Market
Cryptocurrency exchanges have been the dominant players in the crypto trading space. However, they are starting to face competition from some of the leading fintech companies in the world. PayPal, one of the top online payment platforms in the world, expanded its cryptocurrency services to users in the UK. The company said it expects to make it available to users in Europe very soon. The fintech firm is also working on a feature that would allow users to deposit and withdraw cryptocurrencies from third-party wallets.
Robinhood is already ahead of PayPal in this regard. The online brokerage platform has been active in the cryptocurrency space in recent months and is set to launch its deposit and withdrawal feature this month. The broker also became the first entity to offer 24/7 phone support services to its cryptocurrency users.
Stripe was one of the most active fintech players in the cryptocurrency space. However, it exited the industry in 2018 when it stopped supporting BTC payments on its platform. After missing out on the 2020/2021 rally, the fintech firm is now looking to re-enter the crypto space. Stripe is currently putting together a team that would design and build its cryptocurrency offerings. The huge demand for cryptocurrencies had led the firm to reassess its position and consider entering the market again. Other leading fintechs to enter the crypto space in recent months include MoneyLion and Public.com. As more fintech companies enter the crypto space, it will become even easier for people to buy and sell cryptocurrencies.
Traditional Financial Institutions are Also Offering Exposure to Cryptocurrencies
The adoption and cryptocurrency usage are not limited to the fintechs and other crypto companies. Traditional financial institutions are not left out in terms of the adoption of cryptocurrencies. Over the past few months, some of the leading financial institutions in the world have started offering their clients indirect exposure to Bitcoin and other cryptos. Morgan Stanley, Goldman Sachs, BNY Mellon, JPMorgan and Citibank have all started to allow their wealthy clients to gain indirect exposure to cryptocurrencies. They allow the clients to purchase shares in some cryptocurrency funds, such as the Grayscale Bitcoin Trust (GBTC) and others.
US Bank, one of the top ten banks in the United States, is now offering crypto custody services to its institutional clientele in the US or Cayman Islands. Private funds can currently keep their bitcoin with the bank, and it intends to add support for more coins in the future.
In another development, money transfer firm MoneyGram partnered with the Stellar Development Foundation to enable crypto pay-outs in local currencies for users. MoneyGram said it would use Circle’s USDC to settle payments and convert pay-outs to a user’s local currency. MoneyGram’s network is set to be integrated with the Stellar blockchain to settle the USDC transactions. The United Texas Bank will act as the settlement bank between Circle and MoneyGram.
The cryptocurrency space has experienced massive growth in terms of adoption and usage over the past few months despite the decline in prices. Fintechs, countries and traditional financial institutions have all started to look towards Bitcoin and other cryptocurrencies as the digital asset market grows.