Ethereum Co-Founder Vitalik Buterin advocates Cryptocurrency Payments by calling it “Superior” for international payments
The Ethereum co-founder Vitalik Buterin advocates cryptocurrency payments as a “big boost” to international business, charity, and even payments within countries.
He also claims that the superiority of cryptocurrency for payments is often “underrated” related to fiat, pointing to the convenience of international payments and payments to charities as key examples.
Buterin comments were posted in a Twitter thread on August 24, explaining not only his opposition to censorship but also the convenience of increasing cryptocurrencies’ “superiority” for international trade, philanthropy, and domestic payments.
The adoption of digital currencies for payments is growing worldwide. A PYMNTS database report named “Paying With Cryptocurrency” in July found that 85% of surveyed companies with annual revenue of more than $1 billion said they use crypto payments to find and attract new customers.
The availability of crypto debit cards has also been increasing quickly, with Binance recently partnering with Mastercard to publicize a prepaid card for Argentinians. Many of these cards, such as Wirex’s, even reward users with crypto cashback for paying through the card and ease spending of numerous major cryptocurrencies, fiat currencies, as well as the withdrawal of cash from ATMs.
As pointed out by Vitalik, cryptocurrencies are also useful when transferring money internationally and for charitable donations. Usually when done using fiat currency, international payments can take a long time to process and results in large fees. The war in Ukraine is one great example of its helpfulness in this regard, as Vice Prime Minister Mykhailo Fedorov tweeted on Aug. 18 that $54 million has been raised by nonprofit and activist group Aid for Ukraine alone.
Though, everyone is not as bullish about crypto’s use as means of payment, with common protests including price volatility, ease of use, and regulatory risk, as well as high-transaction fees and long processing times for certain cryptocurrencies, such as Bitcoin and Ethereum.
While it can differ, the Bitcoin blockchain handles about five transactions per second (TPS), and averages fees of $0.819 as of Aug 24, while Ethereum is currently conducting around 29.3 TPS with average fees of $1.57. Visa on the other hand claims to be able to handle 24,000 transactions per second and charges between 1.4 and 2.5% per transaction.
The progress of the lightning network, a layer-2 solution built on top of Bitcoin’s blockchain, could be a solution for Bitcoin’s lagging TPS, while Ethereum has been looking to layer-2 roll-up technology, such as ZK-rollups to vastly reduce fees and processing times.
