Economics

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Expect Rise of Cryptocurrency in Travel Industry

11 Jul, 2018

By: Mary Helen Sprecher

The FIFA World Cup in Russia has made headlines for a lot of reasons (including the early exit of Germany, the previously reigning champion). On the business end, however, was the fact that cryptocurrency (including Bitcoin) made its debut as a widely accepted form of payment at the tournament.

According to an article in CCN, Buying Business Travel Russia reported that Apartments Malina had teamed up with the online payment system, Free-Kassa, to allow users to purchase rooms with cryptocurrencies. A total of four matches were played in Kaliningrad in June.

According to a rough translation, Apartments Malina’s manager, Anna Subbotina said, “Crypto-currencies are now enjoying increased interest. Gradually they will come into use as a means of payment. And we decided that the fans should be able to pay for our services with the help of this innovative technology. It may very well be that other hotels [are] awaiting our example for the forthcoming football holiday.”

But cryptocurrency didn’t only see use in lodging during the event. Killfish, a chain of bars in Russia, noted that it would be accepting Bitcoin for alcoholic drinks as part of an extensive promotional program that promised great discounts.

(Don’t know much about cryptocurrency? Here’s a great article for beginners printed in Ohio State University’s student newspaper, The Lantern).

So with all this attention, can we expect to see cryptocurrency hitting the sports market back home? We already have. The tech-savvy Sacramento Kings (they of the solar-powered sports arena) started accepting Bitcoin back in 2014 and just recently announced their intent to mine digital currency. Through a partnership with MiningStore.com, the team intends to install cryptocurrency mining machines at Golden 1 Center.

The question, of course, becomes this: When can we expect to see sports events accepting cryptocurrency from athletes and families to pay registration fees and other costs in the travel sector? It appears to be an open question – and one to which we may not see a widespread answer for some time yet.

While plenty of major events and teams are warming up to the idea, smaller ones remain leery. Different theories abound regarding the reason for the hesitation, including the fact that as an overall technology, cryptocurrencies such as Bitcoin are immature and have not had time to build the public trust. Bitcoin is still not widely accepted by most retailers and merchants. And, an article in Bloomberg notes, some cryptocurrency users, who were quick to jump on the bandwagon initially, no longer see the point in using Bitcoin for small purchases given increased transaction fees; the classic example is purchasing a cup of coffee in a shop.

Twitter had already banned ads for cryptocurrency, as have many other social media channels, including Reddit and Facebook. Google also banned such ads. Twitter noted the step was being taken in the interest of protecting reader safety.

Depending on who is answering the question, implementing the acceptance of cryptocurrency as a form of payment is either the greatest idea since instant replay or the worst idea since awarding the 1976 Olympics to Denver over the opposition of its population. Here are two articles listing a few of cryptocurrency’s advantages and a few of its risks and disadvantages. Forbes also takes the position that non-profits should be accepting it as an avenue for donation.

One positive thing a decision to accept cryptocurrency will do, says Forbes, is provide a public relations pop. It is, the publication notes, a factor of the relative newness and risk – and is sure to attract attention. Internet companies like Overstock, OKCupid and Zynga now accept Bitcoin and an increasing number of restaurants are doing so as well.

Expect to see the rise of cryptocurrency in the travel industry overall. This article details where it’s accepted and how it’s growing across the board. (Note: Expedia even accepts it for hotel bookings.) Travelers could see Bitcoin, for example, as a way to circumvent costs of currency conversion, ATM withdrawal fees, transactions fees, and fraud risks that come with international credit card use, according to digital currency news site CoinDesk.

Another avenue of the sports business sector where cryptocurrency is growing is online gambling on sports events. Bitcoin betting sites cover not just mainstream sports (soccer, basketball, tennis and horse racing, for example) but less well-known pursuits such as pool and martial arts. In fact, the Bitcoin Gambling Guide is here to tell you everything you need to know.

Do you think cryptocurrency will ever be used in the sports event industry? Cast your vote in SDM’s new poll here!

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