How Cryptocurrency Influences the Travel Industry

Cryptocurrency though was considered a redundant digital invention at the time of its conception in 2009 with Bitcoin being the first of its kind, now it is one of the most powerful and influential parts of every industry, especially the travel and tourism industry. Over the past couple of years, both the popularity and demand for cryptocurrency have grown exponentially across the globe.

Several innovative blockchain-based solutions have been introduced and are still in the making to tackle the most prominent traveller inconveniences. Accenture by forming a partnership with the World Economic Forum (WEF) is developing one of the smartest solutions. Before elaborating on the most significant impacts cryptocurrency has made on the travel and tourism industry, let’s get a clear idea of what is cryptocurrency.

What is Cryptocurrency

The non-state-sanctioned currency that is created using blockchains is called cryptocurrency. In other words, if you write some code, then the computer will crunch its algorithm and solve it at a set rate, each solved algorithm will earn you some Bitcoins. Unlike physical currency, there is no known technique to forge the unique cryptocurrency as it involves a high level of encryption to create and transfer each of them and often p2p network is used to complete the payment procedures. So, it is quite a secure process.

The regular supply of Bitcoins at a predefined rate enables the currency to remain stable and secure. The amount of popularity this currency has gained so fast serves as an assurance of its viability and legitimacy.

Although they are not backed by anything other than computerized mathematics, Cryptocurrency has the potential to become the next prime medium of exchange globally.

How does it work?

Coinbase, Blockonomics, NOWPayments, and Coingate are just to anime a few popular payment gateways that accept payments with digital coins. These apps are a quick and safe way to transfer funds or make payments for both merchants and consumers. From scanning QR codes to their compatibility with eCommerce platforms, each and every gateway has its own unique way to make payments.

Among all the online currency, the frontrunner is, without a doubt, Bitcoin. With the fast-growing popularity and number of investors, now even some governments and businesses leaning towards opening doorways to consumers’ digital wallets. El Salvador has already made Bitcoins legal tender within its borders, and other countries are are catching up to the trend.

Now that we have that in the clear, it’s time to look at the tremendous impact Cryptocurrency has had in the travel industry.

Opening a Doorway to Transparent payments

Research shows that 22% of US travellers prefer Crypto payments over the conventional one. Following this request, platforms like Expedia were built to enable this consumer request and establishments like hotels and airlines are also accepting Crypto payments.

To ensure a direct, faster and safer payment methods, Cryptocurrency can guarantee provide a transparent system that bypasses any expensive third party, and thus optimising the traveller’s experience. In an industry that is fragmented by scattered paper-trails, this type of fluid transactions are a welcomed change. This will help to grow and diversify the client demography. In 2021, The amount of global crypto millionaires crossed a significant number, and more than 75% of them like to splurge that income on travelling with style and luxury.

Redefine Loyalty Programs

In order to compete and stand your ground in any industry, loyalty programs play a very important part. Especially in a cut-throat sector like travelling and tourism, where many companies have come and gone within a year, building a trusted and loyal list of clientele is a must to stay afloat. And exciting crypto rewards are a dominant part of that.

Companies can often offer reward points as incentive which they can control, whether to discontinue them or to lower the amount offered. However, the decentralized attribute of cryptocurrency makes its value fluctuate based on market demand. This can be deemed as a con next to a long list of pros. Anyway, these loyalty points can be traded or exchanged for fiat, enticing customers to further participate.

The cashback system has also raised some concerns in the travel industry as well. However, with crypto, cashback can be considered as an investment: A traveller invests every time they book a trip and earns coins they can use for further experiences. They can cash out these points at any point without worrying about the currency differences.

Farewell Old-fashioned Tickets and Confirmations

NFTs are also a prominent blockchain-powered innovation that can take the travel industry much further along than it ever was. In the travel and tourism sector, they can be substituted as a form of verifiable and transparent access to goods and services. This will reduce the risk of flawed reservations while decreasing any fraudulent experience a traveller might fall victim to, as all the information will be safely and securely stored in their wallets.

Consumers can now personalize, modify, cancel or even sell their trips to other interested parties without the intervention of a third party or suffer through laborious bureaucratic nonsense.

The world of Crypto currency can seem daunting from the outside to both travellers and people connected to the travel industry. While rolling regulations and value fluctuations are still some challenges that are yet to overcome, once they are worked out can become the most powerful asset.

Bitcoins provide the travel company the opportunity to ensure a proper, faster and more secured transaction with their clients or any other third party. These are online assets that are universally recognised and valued the same at home as well as overseas, thus reducing the hassle of currency conversion and difference in worth. Hence, opting for a Cryptocurrency based transaction system can have an influential impact on the travel industry as it greatly enhances the customer experience by reducing a lot of the redundant hassles.