End-users of technologies don’t want to think — they just want to use. And out-of-the-box usability is particularly essential when it comes to next generation innovations disrupting payments and commerce.
This, however, can at times be at odds with the mindset of the builders of innovative technologies, who spend much of their waking moments engineering new efficiencies or coding new, complex capabilities, and less time thinking about usability from the perspective of audiences who have a bare sliver of their technical know-how.
Take, for example, the crypto sector and its passkeys, blockchains and history of insider-only techno language. Terms like “hashing,” “public/private keys,” “digital signatures” and “zero-knowledge proofs” are complex and not intuitive for most users, while words such as “nodes,” “miners,” “consensus algorithms” and “smart contracts” can be confusing without a technical background.
That’s why, with the recent news that the New York State Department of Financial Services (DFS) has introduced new customer service guidelines for cryptocurrency companies, observers are taking it as a sign of market maturation. A market maturation that is focused on removing the technical jargon and complexities that make cryptocurrencies difficult for the average person to understand and use.
That’s because, for cryptocurrencies to scale and gain wider adoption across payments, focusing on ease of use across targeted use cases, rather than purely on technology and engineering capabilities, is crucial. After all, traditional payment systems like credit cards and digital wallets are already easy to use and are built atop established, almost invisible transaction behaviors. To compete or augment, cryptocurrencies need to match or exceed the ease of use of these established systems.
And new marketplace moves from traditional financial services players, including Mastercard and PayPal, show the emergence of a new focus on simplifying crypto’s more complex aspects by creating the more intuitive, user-friendly experiences that are essential for broader adoption.
Read more: Can Blockchain Solve the Cross-Border Payments Puzzle?
Growing Adoption of Digital Assets by Traditional Payment Firms
Last Wednesday (May 29), it was announced that PayPal’s stablecoin, PayPal USD (PYUSD), was being made available on the Solana blockchain in a move designed to make the stablecoin faster and cheaper to use, giving users the choice of multiple blockchains for more flexibility and control.
Solana’s current transaction processing rate of 1,423 transactions per second (tps) was reportedly a key factor in the decision, as retail applications require the ability to sustain at least 1,000 tps. In comparison, other popular blockchain’s such as Ethereum process only 12 to 15 tps.
And Singapore-based financial institution Triple-A also announced it was adding PayPal’s PYUSD stablecoin to its payment services. According to the firm’s release, Triple-A aims to more than double its payment volumes by the end of 2024, with the help of the PYUSD integration.
Mastercard last Wednesday as well introduced a crypto credential that enables cryptocurrency holders to transact without using long and complex blockchain addresses.
A day prior, on Tuesday (May 28), Web3 infrastructure firm MoonPay launched Web3 Tools, a platform for “building mainstream-ready digital experiences.” MoonPay said several high profile brands have already used the platform, including Mastercard, Gucci, Puma and Adidas.
Mainstream-ready capabilities and conveniences like settlement speed, cost, and a focus on user-experience are, after all, exactly what will be needed to grow adoption of digital assets and allow crypto to make deeper inroads into the world of traditional finance.
Read more: Solana Foundation Goes All In on Blockchain as a Mainstream Payments Rail
Moving from Usability to Use Cases
Focusing on ease of use is vital for the widespread adoption of cryptocurrencies. While technological advancements and engineering capabilities are important, they must be paired with user-friendly designs and interfaces to attract and retain users, integrate seamlessly with existing systems and compete effectively with traditional payment methods.
“It’s important to know that crypto is not just bitcoin and Doge and NFTs,” Sheraz Shere, head of payments at Solana Foundation, told PYMNTS. “… Blockchains are really alternative rails for payments and financial assets … An issue has been that the technology has not been user-friendly, it’s all been designed by engineers … to be very tech-centric and not use case or UX centric.”
Simplifying the user experience ultimately leads to higher adoption rates, greater trust, and a more inclusive financial ecosystem — but it all means nothing is crypto’s usability is not directed at a true use case with a real-world impact.
And one of the most attractive opportunities for crypto to showcase its usability is within cross-border payments.
PYMNTS Intelligence finds that, when it comes to cross-border payments, blockchain solutions could offer advantages over traditional systems. That’s because blockchain’s high throughput, low fees and 24-hour availability could remove much of the friction of cross-border transactions, making each one as easy as sending a Venmo payment.
Still, one area that needs work for usability to scale will be building the tools within crypto to help regulators and payment operations team operate better. After all, in the world of traditional money movement, things tend to work well — or at least relatively smoothly — due to extensive tools for anti-fraud and other compliance needs. Similar tools may need to be developed and deployed in the blockchain.
According to PYMNTS Intelligence, 52% of traditional financial firms considering blockchain and crypto adoptions said unclear regulation was their top concern.
But progress and inroads are being made. “Big banks and financial institutions are much more interested today than they certainly were five or six years ago, when we rolled out some products for the first time,” Brooks Entwistle, senior VP of global customer success and managing director at Ripple, told PYMNTS last fall. “You certainly almost never saw the boardroom when you brought up the topic of blockchain and especially crypto in the early days.”
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