Online purchases using Bitcoin (BTC), Visa and on a number of payment applications declined in the first quarter of 2020, including crypto and fiat currency transactions.
We can see that online shopping and home delivery are on the rise as many people around the world are self-isolating or being advised to stay at home to prevent the spread of Covid-19. However, with rising unemployment and an uncertain future for the economy, it seems that consumers would rather save their money than spend it.
The Competition of Bitcoin Trading During the “Crypto Winter”
The crypto market has not escaped this decline in purchasing power either.
The number of daily BTC transactions has decreased by around 100,000 transactions since the beginning of March. The last time the number of crypto transactions reached a low was during the “cryto winter” – after the price of BTC dropped to around approx. $3,000 in December 2018.
Right before the Covid-19 epidemic spread to many countries, on February 5, the Bitcoin network reached over half a billion transactions - since the first took place on January 12, 2009. These data indicate acceptance for the payment of daily purchases in cryptocurrency. The recent drop is a significant obstacle to this goal.
Market analyst primexbt exchange commented that “people are simply more hesitant to spend Bitcoin at the moment.”
Visa reports plummeted at the end of March
According to Reuters, Visa is predicting a single-digit increase in second-quarter revenue percent after a sharp drop in operations in March - as opposed to double-digit gains in Q1 2019.
Reuters also argues that measures such as stay-at-home quarantines or lockdowns could be a factor in this sharp drop - by preventing consumers from swiping their Visa cards in person at restaurants, entertainment venues, and restaurants. other activities outside. However, online spending also fell, including on major travel-related services such as airlines.
See more: Institutional investors are "absent" during Bitcoin's volatility
Infrequently used payment apps
Square, the company behind the Cash App — the crypto-powered app — is expected to report lower-than-expected revenue and earnings after claiming a 25% reduction in total. payment volume of sellers on March 25. The company is also withdrawing projects planned for 2020 and will deliver new ones in May.
The news that can be viewed as positive, at least the number of pizza deliveries is increasing. US pizza chain Papa John's said sales rose more than 5% in the first quarter of this year, as people during the quarantine will depend on home delivery options.
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