Investment bank Morgan Stanley recently came out with a report suggesting bitcoin acceptance has dropped to “virtually zero and shrinking.” The report was created by the investment bank’s internal analyst team, which was headed by James E Faucette.
A Yahoo Financial article elaborated, saying, “According to the bank, last year bitcoin was accepted at five of of the top 500 online merchants. Today, only three of the top 500 merchants accept bitcoin as a form of payment. ” The bank suggested that this fact is striking, because bitcoin has seen such monstrous growth over the last couple of months.
Morgan Stanley’s Three Reasons For Declining Merchant Acceptance
Morgan Stanley provided three reasons why it believes merchant acceptance is shrinking.
They said the first reason is bitcoin’s bull market nature. The price tends to skyrocket and people want to hold it for the purposes of gaining incredible amounts of wealth. People would rather do this than use it as a currency, said the bank. This provides evidence bitcoin is more of an investment vehicle than a form of currency.
Bitcoin’s scalability problem represents another issue. The analyst team pointed out merchants may not want to accept the cryptocurrency because of fears regarding the scaling debate. All the uncertainty and fear surrounding it has allegedly led to hesitation about bitcoin adoption.
Lastly, the investment bank pointed out the main players in the bitcoin space are not cajoling merchants into adopting the currency. The bank clarified:
The ecosystem has focused more on value speculation rather than the foot leather-eating work of increasing acceptance – way easier to trade speculatively than convince new merchants to accept the cryptocurrency
Bitcoin May be Growing Healthily in Non-Financial Markets and Other Places
It is currently unclear if the Morgan Stanley research included bitcoin merchant adoption worldwide—as well as non-major retailer acceptance—because a July 13 article on pymnts.com titled “Bitcoin Tracker: Mainstream Acceptance On The Rise” declared the exact opposite.
The article proclaimed, “The digital currency has been restricted to the financial sector, but it’s slowly moving its way into more mainstream uses. One of the main issues that most have had with the digital currency is that because of a lack of a central authority, it can be tough to regulate.”
Pymnts mentioned that many non-financial entities have begun making changes so they can adopt bitcoin. For instance, the article said, Burger King locations in Russia are slated to start accepting the cryptocurrency over the next few weeks. The BBC also reported that a variety of schools, including some Montessori locations, have started taking it.
Bitcoin.com recently covered the Japan bitcoin phenomenon, which suggests that a whopping 260,000 are entering into the bitcoin ecosystem via a mobile application. Kevin Helms elaborated:
Three months after Recruit Lifestyle partnered with Japanese bitcoin exchange Coincheck to enable over 260,000 retail stores to accept bitcoin, the company has finally announced on Monday that its point-of-sale app is now bitcoin-ready. Immediately, a chain of 334 eyeglasses stores using the app announced that it will accept the cryptocurrency starting July 10
Do you believe bitcoin merchant adoption is rising or falling? Let us know in the comments below.
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