PwC Report: Cryptocurrency Can ‘Open the Door for Revolutionary Possibilities’

PwC Report: Cryptocurrency Can ‘Open the Door for Revolutionary Possibilities’

by September 23, 2015
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Cryptocurrency will still face many challenges but is here to say, according to ‘Big Four’ advisory firm PricewaterhouseCoopers (PwC). In a recent whitepaper, the firm claims that the technology “has the potential to open the door for revolutionary possibilities.”

Entitled ‘Money is no object: Understanding the evolving cryptocurrency market,’ the report aims to provide an update on the current cryptocurrency market as well as a look into the technology’s future.

PwC has spent over two years monitoring the sector, assigning its own professionals from around the world to analyze and assess cryptocurrency’s impact.

Blockchain could introduce major changes across multiple industries, including government, financial services and retails, PwC said. But according to the firm, “any industry that relies on a trusted third-party clearing system could be impacted.”

pwc blockchain impacts

Potential impact of digital currency – 2015 PwC Consumer Cryptocurrency Survey

Limited knowledge of cryptocurrencies

“To better understand the consumer side of the market,” the firm has conducted a survey, which found that knowledge of cryptocurrencies remains limited. Results showed that only 6% of the respondents said they were either “very familiar” or “extremely familiar,” against 83% who said they were either “slightly familiar” or “not at all familiar.”

pwc crypto limited knowledge

Knowledge of cryptocurrencies – 2015 PwC Consumer Cryptocurrency Survey

Overall, cryptocurrencies are mostly used for online shopping, according to the results. 81% of the respondents who have used cryptocurrencies in the past 12 months, said they did so to shop online.

pwc crypto usage

Usage of cryptocurrencies – 2015 PwC Consumer Cryptocurrency Survey

The survey also found that only 17% were “very” or “extremely” concerned about cryptocurrencies, against 48% who said they are only “slightly” concerned and 12% who said they were not at all concerned.

Among these concerns, cryptocurrency users cited fraud, price volatility, as well as the small number of merchants accepting digital currencies as a payment method.

Overall, respondents were bullish about the potential impact of cryptocurrencies on banking and retail.76% of current users said that cryptocurrencies will “redefine banking as we know it,” while 59% said their “banking experience would be improved if they had greater access to cryptocurrencies.”

Advantages for merchants

For merchants and businesses, cryptocurrencies offer many benefits, PwC said, including low transaction fees and lower volatility risk resulting from nearly instantaneous settlement, and they eliminate the possibility of chargebacks.

“Even with changes to the incentive structure over time, minimal transaction fees may help cryptocurrency dominate traditional payments and transfer methods.”

Nevertheless, PwC pointed out that blockchain, the technology underpinning cryptocurrencies, is “the most important potential disruptor.”

“This technology has the potential to open the door to revolutionary possibilities in multiple industries,” the document reads.

“Escrow accounts, securities and financial instrument offerings, ‘smart contracts,’ and electoral systems are just a few of the concepts that are being discussed. Any financial asset that currently requires a trusted third party to provide verification could, theoretically, be disrupted.

“The blockchain public ledger may indeed be the beginning of a revolution in cryptographic technology.”

Read the full report: http://www.pwc.com/us/en/financial-services/publications/assets/pwc-cryptocurrency-evolution.pdf

Image credit: Price Waterhouse Coopers building in Oslo, Bjørn Erik Pedersen.

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