Multinationals see blockchain value for smart contracts. Photo: NASA, Unsplash.
More than half of multinationals (56%) already use blockchain, especially for smart contracts. And you use or plan to use cryptoactives to facilitate your international payments. Meanwhile, 28% have cryptos for investment or asset management purposes on their balance sheets. Therefore, what interests global companies today is the usefulness of digital currencies and not what Elon Musk and MicroStrategy like to brag.
The conclusion comes from the study “Cryptocurrency, blockchain and global business: assessing the potential for multinational companies in financial institutions”. The survey is by Pymnts, which studies payments, and by Circle, responsible for the USDC stable currency.
To conduct the study, Pymnts and Circle interviewed executives from 250 multinationals and 250 financial institutions (FIs) who work for these companies. The focus on multinationals is due to their power to set global standards and facilitate the exchange of resources between countries.
According to the study, 77% of multinationals that are in at least six economies use at least one type of cryptocurrency. Of those in two markets, a third use crypto. Bitcoin is the most used cryptocurrency (31%) and next, very closely, come stable coins (29%) and then ether (24%).
In addition, 42% of multinationals use blockchain for smart contracts, to define or confirm terms of agreements. Then comes the use in international transfers (37%), since blockchain allows sendings in virtually real time, with transparency and lower cost, unlike what it is today. However, an interesting point is that 23% of companies are interested in applying blockchain for other types of payments.
Multinationals and banks still don’t understand well about blockchain
As traditional financial institutions (FIs) realize that demand for cryptocurrencies will grow, 75% expects to offer services related to these currencies and the blockchain in the next 12 months, compared to 10% today.
But, there’s a problem: FIs haven’t yet realized that for multis, the greatest value of these assets is in the utility for transactions and not in investments or balance sheet issues. Thus, the risk is that FIs are not fully aligned with what companies need.
Indeed, PYMNTS and Circle show that financial institutions give a number of reasons to expand their blockchain and cryptocurrency services. This shows that “their strategies for launching them are uncertain and unfocused”.
Although most of both IFs and multinationals have teams that are dedicated to blockchain, most decision makers on both sides admit that they know at best “moderately well” the technology. And a third know little or nothing. Thus, there is a need for education in companies and FIs about the blockchain.