Following the pandemic, the travel industry has found new ways to innovate and entice new customers. Now the travel industry is opening up again, acceptance of digital currencies is considered to be one way of helping the industry to recover.
Cryptocurrency has emerged as an effective payment option for a range of different applications and platforms and is becoming increasingly mainstream. More and more travel suppliers are starting to accept bitcoin, dogecoin and other cryptocurrencies, with those such as Cheap Air, Bitcoin Travel, Travala and Expedia allowing customers to use cryptocurrencies as an accepted payment method.
The UK’s largest provider of travel insurance has also launched the world’s first bitcoin holiday comparison tool. The launch of ‘My Bitcoin Holiday’ which comes after an increase in enquiries related to cryptocurrency, is another indication that institutions are paying attention to traveler’s increased appetite for cryptocurrency payments – a demand which we’re likely to see grow steadily within the next decade.
What are the benefits of booking your travel using cryptocurrency?
As we gradually advance into a cashless society, cryptocurrency has the potential to gain a lot of traction within the travel industry. The decentralized nature of blockchain technology has the benefit of building transparency, flexibility, and efficiency into transactions, while streamlining existing processes for pricing and payment collection.
Cryptocurrency can offer the benefit of added security due to the nature of decentralized blockchain technology. Safe and trusted transactions are an important requirement within the travel industry due to the high-value purchases associated with travel.
Another benefit of booking with cryptocurrency is saving money on international transaction costs. Making purchases with your credit or debit card in a foreign country can incur a foreign transaction fee of up to 3% on purchases made within other countries. Making payments using cryptocurrencies can help you avoid any additional costs when travelling. The price of cryptocurrencies also remains the same regardless of which country you are visiting, meaning you don’t need to exchange the cash for currency of that country.
What are the cons of booking your travel using cryptocurrency?
There are some benefits to using a credit card that are not offered to those using cryptocurrency as a preferred payment method. For example, credit card companies allow users to dispute potentially fraudulent charges under the ‘Fair Credit Billing Act’ – something not currently offered to crypto owners.
Another major limitation is that cryptocurrency is not yet widely adopted. Although the number of institutions accepting cryptocurrency is growing, there are many who have not followed suit. There are a number of countries who have even banned cryptocurrencies, preventing you from using Bitcoin as an official payment method. These include countries such as Algeria, Bolivia, China, Egypt and Nepal, while many other countries remain very skeptical of the currency.
Although cryptocurrency adoption within the travel industry may be in its infancy, one thing remains clear – institutional adoption is, and will continue, to grow. Given Gen Z are likely to drive digital currency acceptance moving forward, travel suppliers and insurance providers should be making concrete steps towards embracing cryptocurrency payments soon. Whether consumers decide to use cryptocurrency for their travel payments will largely depend on personal preferences, as well as the location and the nature of the trip.