By CCN.com: Major travel agency CheapAir has reportedly processed more than $5 million worth of bitcoin payments since its integration of the dominant cryptocurrency in 2013. To better serve cryptocurrency users, CheapAir CEO Jeff Klee said that the firm will soon accept Ethereum.
Speaking to Forbes, Klee said:
https://t.co/GrHKdmlIGO continues to embrace cryptocurrency as payment and we’re dedicated to cater to #Bitcoin, #Litecoin, #Dash and #BCH customers. Via @ForbesCrypto @iamwormify https://t.co/nUGPwf41TG
— CheapAir ✈ (@CheapAir) March 18, 2019
The Travel Industry is Increasingly Adopting Bitcoin
On April 16, CCN reported that Corporate Traveller, a division of Flight Centre Travel Group, one of the world’s largest travel companies, is integrating cryptocurrencies like bitcoin and bitcoin cash.
In an official statement, Corporate Traveller UK general manager Andy Hegley disclosed that the demand for a bitcoin payment option has increased in recent months from clients.
We identified an increasing demand from our clients for the option to pay in bitcoin for business travel bookings made by our travel consultants. We chose BitPay to manage our merchant processing because they make it easy and handle the entire process of getting the Bitcoin or Bitcoin Cash from the customer and depositing cash into our account.
In an emerging industry like crypto, for long-term growth, first mover advantage is crucial. Both businesses and blockchain projects that emerged from 2013 to 2014 have thrived throughout the past five years by developing a strong brand image.
As the usage of cryptocurrencies increases over the long run, cryptocurrency users are likely to spend digital assets on platforms with dedicated teams in facilitating cryptocurrency payments and that are understanding of the technological limitations of the blockchain, especially when it comes to scalability.
We are now multiple years into “the dawn of highly scalable and secure blockchains”.
Some exceptions, but here’s what we have to show for it:
– extreme delays
– unrealistic expectations
– fundamental problems unsolved
I’m just being honest.
— Spencer Noon (@spencernoon) April 25, 2019
Muneeb Ali, the CEO of Blockstack PBC, a company that received an investment from affiliates of the Harvard Endowment to launch the first U.S. Securities and Exchange Commission (SEC) registered token sale, said that blockchains, by nature, do not scale.
“Blockchains don’t scale. Period. The limits are physical bandwidth and laws of physics (not going to change). The only realistic approach is to do less at the blockchain layer. The entire ‘world computer’ idea is flawed,” he said.
As such, until blockchain protocols evolve to a point in which second-layer solutions are well established and used, it will be difficult for large-scale conglomerates to widely adopt cryptocurrencies for payments.
CheapAir CEO Jeff Klee emphasized that the company’s dedicated crypto payments team has continued to learn about crypto and blockchain technology to efficiently clear cryptocurrency payments in the future.
Why Go the Extra Mile to Process Cryptocurrency Payments?
When the bitcoin price achieved an all-time high at $20,000 and the network was overloaded with transactions, the mempool, a space within the Bitcoin blockchain used to store temporary transactions for miners to process, clogged up.
It delayed transactions, sometimes up to 24 hours, pressuring some users to use higher fees to get miners to prioritize their transactions.
Companies could see the so-called “fee market” as an issue as the market recovers and the usage of cryptocurrencies rises by exploring various ways to do so.
But, it is not cheap to have an entire team working on a cryptocurrency payment infrastructure at all times to process $5 million in volume over several years, which is low relative to the total payment volume of travel agencies.
For any company that integrates bitcoin at the current juncture, it is a long-term bet that the asset class will ultimately survive and will see explosive growth in usage. When crypto grows, firms like CheapAir that allocated resources to become a first mover in the industry will likely see the benefits over the years to come.