According to a report by exchange Coinbase, the use of blockchain could have saved Americans $74 billion in transaction fees by 2022. That’s $600 for every household in the US. The report also highlights the speed and accessibility of crypto transactions.
Reduce transaction costs as crypto is optimized
Transferring funds via the traditional financial system is largely cost and time intensive. Cryptocurrencies, on the other hand, stand out as a cheaper, faster and more easily accessible payment system. This, in any case, is what the exchange Coinbase in his report entitled “Fairer, cheaper and faster everyday finances”.
According to Coinbase, payments via blockchain can be up to 5,000 times cheaper than payments via the traditional financial system, particularly for international money transfers. Coinbase estimates, among other things, that blockchain technology could have saved Americans $74 billion in transaction costs by 2022. This amount represents around $600 for every household in the country.
As an example, a $1,000 transaction incurs credit card fees of between 1.5% and 3.5%. This represents a fee payment ranging from $15 to $35, depending on the financial operator. Yet paying the same amount of $1,000 via blockchain incurs transaction fees of up to $0.01…
On a comparison chart, Coinbase shows the wide disparity between different transaction fees. While bank transfer payments incur fees of up to $50, not including card fees, some blockchains charge fees of less than $0.01.
Faster and more accessible thanks to crypto payments
In addition to the low cost of transactions, Coinbase highlights the speed of blockchain payments. Thanks to the speed of the Internet and the absence of intermediaries, blockchain transactions save users an enormous amount of time.
Coinbase emphasizes that blockchain processes payments between one second and one hour, depending on the network. In contrast, traditional payments take between one and five business days to execute. This suggests that crypto transactions are up to 432,000 times faster than some traditional methods.
The accessibility of crypto compared with the traditional financial system is also the focus of Coinbase’s study. Creating and managing your crypto wallet requires only internet access. Holding a bank account, on the other hand, is much more complicated. No matter where you live, setting up a bank account requires paperwork and costs. In addition, customers may have to make a substantial initial deposit and subscribe to various banking services to get their account up and running.
It is this ease of access and the inflation affecting national currencies in particular that are driving the strong adoption of crypto. According to a study by Crypto.com, cryptocurrency users worldwide exceed 580 million people.
Is it time for change in our financial system?
Today, most Americans rely on the traditional financial system. According to Triple A, there are 53 million crypto adopters in the USA, or almost 15% of the population. However, blockchain’s advantages over the traditional financial system could be a game-changer.
Coinbase’s report reveals that Americans are ready to embrace an updated, faster financial system with fewer fees. Indeed, 71% of Americans would like to see transaction fees drastically reduced. In addition, 70% of Americans are in favor of faster, anytime transactions. Finally, 63% of Americans believe there is a need for a more accessible financial system:
Almost everyone agrees that the current financial system is too expensive, slow and difficult to access. A recent study showed that that the traditional financial system is used for illicit transactions. Blockchain may well correct these notable failings. With cryptocurrency, financial payments can be cheaper, faster, safer and accessible to all. How long will it take before crypto overcome the traditional financial system thanks to reduced transaction costs?
I dream of a world where every citizen has total control over themselves, including their finances. I believe that Bitcoin is one of the tools that will achieve this revolution. Since 2019, I am learning about this cryptocurrency and spreading the word around.