The Best Ways to Send Money Using Cryptocurrency
Major retailers and corporations are beginning to accept digital currencies as payment. For example, AMC, the US theater chain, recently started accepting cryptocurrencies as payment for movie tickets. In addition, Elon Musk, the founder of Tesla, has confirmed that Tesla is now accepting Dogecoin for some merchandise on its website. But more importantly than these headline grabbing events, is the growing use of crypto for sending money around the world, as testament to the growing integration of digital currencies into our daily lives.
According to World Bank data, over $550 billion was sent abroad from the United States alone in 2020. However, people using traditional baking or wire services had to deal with slow processing times, failed transactions, third-party interference, and the high cost of transactions. In comparison, crypto ranging from Bitcoin to stablecoins, has proven to be a highly secure and efficient way of sending money worldwide from person to person, with little room for third-party interference apart from standard KYC and AML checks. Statista’s 2020 survey showed higher crypto remittance adoption in developing countries including Nigeria at 34%, Philippines at 20%. By comparison, German and Japanese adoption rates were at 5% and 4%. As a result, we’d like to share with our users some of the most efficient ways to send money worldwide using crypto.
Centralized exchanges: Using centralized exchanges such as BigONE or Binance is arguably the most efficient way to send money worldwide. For starters it’s the easiest way for people new to crypto to buy and send a wide variety of digital currencies, with the benefit of professional 24/7 support. Compared to decentralized exchange (DEX), centralized exchanges provide an additional layer of security, legal compliance, and protection for investors’ holdings. Choosing an exchange such as BigONE with thorough know your customer (KYC) compliance systems in place avoids being incorrectly flagged for compliance-related issues: “Crypto exchanges with inadequate or unsuitable KYC procedures also risk negatively affecting their customers’ experience of their services. Effective KYC is a way to optimize experiences for lower risk customers, ensuring service speed and efficiency where onerous AML/CFT scrutiny is not required,” explained compliance experts Comply Advantage.
Where the use of crypto for remittances has the greatest potential is in the emerging markets such as Africa. There are several crypto startups trying to tackle this need such as BABB, based in London and recently FCA-registered, which says it is using technology to “bypass traditional banking networks and expensive 3rd parties to facilitate borderless P2P transactions across the globe”. Yet despite such lofty ambitions, the complexity of crypto and the complicated nature of crypto for end users has been a key barrier to entry into emerging markets, says Africa-based crypto payments startup BitPesa, on why a conventional crypto approach to payments won’t work in Africa. “Compliance complexities, payment infrastructure delays, and individual company operational difficulties still make it hard to complete an end-to-end digital currency transaction unless the participants are existing users with existing stores of digital currencies. Understanding these nuances and establishing partnerships with local payment companies has played a vital role in our success in the African continent.”
Bitcoin ATMs: Just like there are ATMs for fiat currencies, there are now Bitcoin ATMs in multiple locations worldwide, with over 24,000 in mid-2021. Bitcoin ATMs are also an efficient way to send cryptocurrency to different parts of the world. The machines are in 75 countries. The U.S. tops the list with 21,161 locations, followed by Canada with 1,698 locations and the U.K. with 174 locations. During the pandemic they became an increasingly popular way to send remittances without having to use a crowded bank office.
All the user need do is buy some BTC, send it to the recipient’s address in another country, and the recipient will be able to convert the BTC to fiat currency. Although highly effective and convenient, the commissions on each transaction can be quite high, which is a significant disadvantage. One way around get money from someone who is new to crypto is to take a pic of the generated QR code from the wallet. Then the sender can scan the QR code and send the cryptocurrency to that QR code address. The recipient of the crypto remittance can then later withdraw the cash in local fiat directly from the ATM machine.
But perhaps the most dramatic example of the value of ATMs for crypto remittance has come because of El Salvador declaring Bitcoin legal tender in 2021. Following the move El Salvador installed its Chivo bitcoin ATMs in cities across the US to make it cheaper and easier for people to send money to their family and friends. More recently in 2022 there are plans to launch 15 BTC ATMS across El Salvador to better serve its citizens, as well as relaunch its in-house Chivo wallet to address the existing challenges of BTC transfers locally, according to CoinGape.
El Salvador President Nayib Bukele announcing the ATMs on September 14, 2021
Gift cards: Cryptocurrency gift cards can also be used to send cryptocurrency worldwide and purchased through many cryptocurrency exchanges. They function like retail gift cards. Go to a website that sells Bitcoin gift cards, purchase the Bitcoins you want, and pay the required amount. You will be given a gift card to share with your loved ones. They can go to the same website and deposit the Bitcoin in their digital wallet.
The growth of crypto globally
Following the recent news from India that the government has decided to make crypto assets legal BigONE believes that the cryptocurrency industry has yet to reach its full potential. To reach its peak of mass adoption, convenient and straightforward solutions to send crypto globally would be a massive factor in the sector’s long-term viability and growth. BigONE Exchange intends to play an essential role by providing our users with the most secure, accessible service to grow our base of five million users worldwide.
