Jason Butcher, Coinpayments CEO, joins Yahoo Finance Live to discuss the outlook on cryptocurrency payments.
- Welcome back to Yahoo Finance Live. Dogecoin got a new lease on life today. What started out as a joke cryptocurrency now has a market value of $54 billion after Coinbase said it would allow users to trade Dogecoin on its platform beginning this week.
Here to talk about the outlook for cryptocurrencies is Jason Butcher. He is the CEO of coin payments. We're also joined by Yahoo Finance's Jared Blikre.
So Jason, good to have you here. I know that your company was the first crypto payment processor. It came to be in 2013, and a lot's happened in this space in that amount of time. I'm curious if you allow Dogecoin on your platform?
JASON BUTCHER: Yeah, absolutely. We are probably one of the first groups to support Dogecoin. It really is a form of payment. We support over 2,000 cryptocurrencies. So Doge has definitely been a part of it. We've always supported the Doge community, between each other providing the ability to support transactions between each other, but also any merchants who want to accept Dogecoin as a form of payment as well.
JARED BLIKRE: Jared Blikre here. We had this crypto conference in Miami. I don't know if you're going to be a part of it. But there is a lot of excitement around it, a lot of institutional players there. You got your start in 2013. I went to the first Bitcoin conference down in San Jose. Things have changed a lot. Can you speak as to how serious Wall Street is taking crypto now? And is that really necessary to lift it off the ground and really make it mainstream?
JASON BUTCHER: Yeah, for sure. I mean, I'm not going to be at the bitcoin conference myself. Although, I'm going to have some of my team there. I was actually just on a phone call with some of the lead crypto guys from PayPal earlier. And they're all heading there. They're all extremely excited.
So I think the biggest thing is, when you look at Wall Street, or you look at some of the big financial players, what the biggest change was regulation. So a few years ago we were looking at what's going to happen with our business and other businesses in the space. And my feeling was is that as regulations come into place, it will start to move all the big players, the financial institutions, the organizations, and the likes of PayPal, and Square, and others. [INAUDIBLE] when they have clear, precise ways of making sure their business is intact with their financial regulations, they'll all start playing in the market.
And we see that huge today. We also see a huge growth toward the adoption of large financial players, as well as retailers and e-commerce organizations, and groups where we saw, for example-- or last year we saw about a 300% increase in transactions just using cryptocurrency, just in the last year.
- Why do you think it is, though, Jason, that some businesses and individuals are not taking advantage of cryptocurrency? Is it the fear factor? Is that they-- is it that they don't truly understand the space?
JASON BUTCHER: I personally think and relate this to many conversations I have, is that like the credit card industry, many people didn't have credit cards initially, right? And many businesses didn't accept credit cards because they just didn't know. They weren't familiar with it. They didn't trust it. They didn't have the confidence in it. And they were fearful from not accepting cash.
So today, as you know, most places around the world accept credit cards as a form of payment. And I believe that crypto is starting to get to there. So there's an education process. There's an adoption phase. There is the request from their clientele.
So I think that whole area is starting to get bigger, and bigger, and bigger, and more of the consciousness that, hey, cryptocurrencies are a form of payment, and it can be trusted.
JARED BLIKRE: I'd say you have a unique window into some of the data surrounding crypto payments here. And I'm wondering, with a lot of the tokens and coins, including bitcoin itself getting sliced in half over the last month, or approximately thereof, have you seen a drop off in crypto transaction volumes? How levered is the space to the actual price of crypto?
JASON BUTCHER: Well, it's actually a common discussion that we have internally in our own team, as well as with many people, merchants especially. And really if an individual is holding a cryptocurrency and they wish to make a purchase with that, they're going to probably prefer to make that payment, especially if their assets or their money is in crypto, compared to, say, having it somewhere else.
Just like I suppose you would think of, say, cash or credit. If someone has access to credit, they'll most likely use their credit card over their physical cash. So like crypto, if they're holding their funds or their assets in crypto and they don't have access to other funding means, they'll most likely make a payment using that crypto.
So in our systems, for example, two months ago we saw volumes of around $700 million. This month we saw just a slight underneath that market. So yes, there were slight changes. But that's also depending on the markets, the time of year, et cetera.
But year over year, we've seen consistent-- and month over month we've been seeing consistent growth in the amount of transactions, and the total volume of transactions that we're seeing processed.
We do also see a change in some of the processing that is happening from people using Bitcoin, to, say, stablecoins, where about 95% of the transactions used to all be in Bitcoin. Where we're starting to see that around 80%, and much more of a higher usage of stablecoins.
- Well, Jason, we'd just love to get your thoughts on the Federal Reserve working on its own digital currency. But they're saying that there's going to be a need for what they're calling a stablecoin. So their form of a digital currency would be tied to something like the US dollar or to an asset like gold. How might that change the playing field for cryptocurrencies if and when that day happens?
JASON BUTCHER: I don't think it actually changes things too much. We see it happening. I sit on the board with the Emerging Payments Association in the UK. And the British government are also putting together plans to launch a British token, which is backed off of the British pound, similar to many Caribbean islands and organizations and groups-- China has launched one.
I think if you have a stable currency that is backed by a fiat or backed by a government issued currency, you'll have a digital wallet and a digital form of payment, but you'll still have people investing, transacting, speculating, et cetera on the various cryptocurrencies that are out there.
The only area that I would see potentially harmful is if someone said, hey, this specific currency is banned in this specific market. But even then, you still have organizations and groups that are independent, looking for independent ways to hold their value, but also exchange value.
In the US, as an example, there is the barter systems. And billions and billions of dollars are traded globally through barter, which are simply a digital form of exchange of value, and the record of that value. So crypto, in a way, is essentially replacing that, but also giving the ability to transact, store value, and exchange that value between [INAUDIBLE] party.
- All right, Jason Butcher, CEO of Coinpayments. Good to see you today. Thanks for being with us.