Reading Time: 2 minutes
- Coinbase has asserted that blockchain technology could have saved $74 billion in credit card transaction fees in 2022
- According to its State of Crypto report, individuals and merchants could have paid “next to nothing” using blockchain
- The report underscores the growing demand for a cheaper, faster financial system, particularly among digital natives worldwide
Coinbase claims that blockchain technology could have prevented $74 billion in unnecessary credit card transaction fees in 2022. In its latest State of Crypto report, the exchange says that individuals and merchants, rather than paying and losing that amount two years ago, could have paid “next to nothing” by using a blockchain-based solution. The crux of the report shows that there is an ever-growing demand for a cheaper, faster financial system, especially with so much of the world’s population being digital natives.
Legacy System is Not Fit for Purpose, Says Coinbase
In the summary of its report, Coinbase details how legacy institutions “keep the [financial] system unfairly expensive, hard to access, and mired in delays,” while users “must pay, then wait, then pay again as their money wends its way past intermediaries who add fees and time to the process.” This has led to at least three in five Americans desiring updates to the current financial system that make it cheaper, faster, and easier to access.
Crypto, says Coinbase, is seen as the answer to these ills, citing its “ease of use, affordability, and streamlined, fully digital, legacy-free nature.” The time is right for this change, they argue, seeing as a growing percentage of the population are digital natives who have grown up using the internet and internet-based payments, and yet the world is still relying on an analog payments system that actively costs them money to use it.
One Step at a Time
Coinbase found payments over blockchain networks to be up to 5,000x cheaper than payments through traditional methods like bank wires, especially for international money transfers, and the issue is particularly prevalent for smaller international remittance payments. There are already multiple cryptocurrency-based remittance platforms out there, with Strike’s Lightning Network-based Send Globally network making particular inroads in that sector.
Coinbase summarizes that “at a time of broad agreement that the current system is too expensive, slow, and hard to access, the findings lay out how crypto can help update the system to be fairer, cheaper, faster, and easier for everyone to use.” Of course, talking about changing the global financial system and actually achieving it are two entirely different prospects, but we can only try one step at a time.