It won’t be long before crypto plays a role in daily payments beyond Lugano


People normally prioritize convenience in their financial transactions over efficiency. That’s why not everyone uses cryptocurrency — even when it offers more options and lower costs.

The Swiss city of Lugano provides the best evidence of what’s possible: More than 15% of its citizens use the city’s LVGA stablecoin to pay their bills, make purchases at shops and restaurants, and access online services on a daily basis.

Everything begins with one click

Digital assets can offer improvements that are unmatched in the field of traditional finance, and they can be highly accessible. In developing countries, financial services still remain a privilege for a small group of people. Though just 6% of adults don’t have a bank account in the United States, that number exceeds 52% in Africa.

Cryptocurrency hasn’t yet gained the same importance as traditional payment systems in terms of household payments. However, general acceptance is getting closer.

Take, for example, crypto credit cards jointly issued by global payment companies and trading platforms. Stores and services including Wikipedia, Microsoft, and Google already welcome payments in Bitcoin (BTC). The latter exclusively partnered with Coinbase to handle crypto payments for its cloud services. Similarly, Time Magazine teamed up with Crypto.com to streamline digital-asset payments for subscriptions. 

You can even use crypto to pay taxes in cities such as Lugano. To make a payment, residents scan a QR code on the bill and then choose a digital wallet they want to use for payment. Last year, the city’s PlanB initiative announced that residents and visitors of Lugano could live in the city using nothing but cryptocurrency. In addition to online payments, Lugano has more than 400 merchants accepting digital assets. This was made possible through collaboration between the city’s administration and Bitfinex, which developed a platform to support payments with Bitcoin, via Lightning, Tether (USDT), via Polygon (MATIC); and the city’s native LVGA token. The city expects to increase the number of locations accepting crypto to 2,000 stores in the years ahead.

For taxpayers, some companies are also ready to provide ready-made solutions. For example, Coinbase offers a dedicated solution that can help users report capital gains or losses to the IRS. Thanks to a partnership with Cointracker, the company can provide a summary of a user’s taxable activity to share with their accountant or input into tax software.

Still, crypto’s growth trajectory isn’t without bumps and hurdles. Plastic payment cards caused surprise and confusion when they first appeared. Some innovations even faced public resistance. Such reactions are natural; people often fear the unfamiliar. Imagine seeing a zero balance instead of the usual $10 monthly fee — such a shift can turn one’s world upside down. Additionally, user training and adjustment can prolong adoption.

Still, the forecasts are promising. Juniper Research estimates that the global usage rate of digital wallets will reach 75% by 2025. A 2022 study showed that 36% of respondents were ready to receive their salary (all or part of it) in the form of cryptocurrencies. These figures continue to grow, and supply will be forced to adapt to growing demand — arguably within the next two years.

The biggest step for crypto’s integration with the financial industry was the January approval of spot Bitcoin ETFs in the U.S. It signaled that the “legalization” of crypto assets has already begun.

This means ordinary users can start feeling confident about using crypto. They realize that digital assets are a natural and important part of the progress. More freedom of action leads to a completely different approach to the crypto technology implementation to pay for products or utilities.

Moreover, participation by institutional players — such as MicroStrategy, Square, and Tesla — brings credibility and paves the way for wider adoption of blockchain-related services.

A Solana loan from your bank?

The crypto industry expands its pool of their services every year: new products, payment methods, and technologies. It’s unlikely that they will replace financial institutions overnight. However, this moment may come through intermediate stages — when seamless transactions or innovative payment solutions are needed.

Crypto regulations will hopefully lead to a stronger symbiosis between crypto exchanges and banks. It’s not hard to envision a scenario in the near future where users are able to arrange a loan from their banks in the form of their favorite altcoins.

Banks may have to adapt and become similar to exchanges with certain specifics of activity. In this case, decentralized finance (DeFi) platforms — such as Polygon, Archblock and Curve Finance — can bypass financial intermediaries and provide high-quality services with low fees.

The history of financial instruments shows how unexpected the use of a new technology can be. The trends of regulatory change and adoption show the growing role that crypto plays in everyday payments, which is carrying the world toward more advanced ways of organizing finance.

Gracy Chen is the managing director of the crypto derivatives exchange Bitget, where she oversees market expansion, business strategy, and corporate development. Before joining Bitget, she held executive positions at the Fortune 500 unicorn company Accumulus and venture-backed VR startups XRSPACE and ReigVR. She was also an early investor in BitKeep, Asia’s leading decentralized wallet. She was honored in 2015 as a Global Shaper by the World Economic Forum. She graduated from the National University of Singapore and is currently pursuing an MBA degree at the Massachusetts Institute of Technology.

This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts, and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.



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