Increased use of cryptocurrency payments
CoinGate, a crypto asset (virtual currency) payment processor company, announced on the 4th that virtual currency payments in the e-commerce field will surge through 2022.
In 2022, the market was rarely seen in history, but it seems that the market size and actual demand in the payment area are steadily increasing.
Merchants using CoinGate have accepted 927,294 cryptocurrency payments in 2022 (one transaction every 34 seconds). The number of annual transactions increased by 63% year-on-year, 2.7 times the annual average number of 312,500 transactions since the start of business in 2014.
The crypto assets used for settlement with high frequency are
Among the more than 70 cryptocurrencies handled by CoinGate, the usage rate of Bitcoin (BTC) accounts for the largest share of 48%, but it decreased by 7.6% compared to the previous year.
On the other hand, the stablecoin “Tether (USDT)”, which is linked to the value of the US dollar, increased its share from just 2.3% in the previous year to 14.6%, probably due to the unstable market conditions. This is followed by Ethereum (10.9%), Litecoin (9.6%) and Tron (5.8%).
The number of new member store registrations on CoinGate increased by 48% year-on-year. Sales have also increased by 60% year-on-year. The focus is mainly on the use of VPNs (virtual private networks), VPSs, and hosting service providers.
By introducing virtual currency payments, it seems that consumers who do not have bank accounts and users who value privacy will gain support, and sales can actually be expected to increase. In 2022, industry giant NordVPN also adopted CoinGate’s service.
Based in Lithuania, Coingate provides automated cryptocurrency payment services for global businesses and individuals. Real-time settlement of virtual currency and fiat currency is realized, and merchants are protected from price fluctuations of virtual currency. It features an API, multiple shopping cart modules, a point-of-sale system for retailers, and supports cryptocurrency purchases with Visa and Mastercard credit/debit cards on CoinGate.
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Growth of the Lightning Network
According to Coingate, in 2022, usage of the Lightning Network (LN) increased by 97% year-over-year. LN improves remittance speed by conducting transactions outside the blockchain. Mainly for small payments.
In Central America, El Salvador, the world’s first country to legalize Bitcoin (BTC), the government provided its citizens with a digital wallet “Chivo” compatible with the Lightning Network.
LN’s share of bitcoin payments expanded from 4.53% in 2021 to 6.29% in 2022. Regarding the expansion of LN usage, Coingate said:
2022 has been a great year for Lightning Network. BTC capacity has doubled in a year and the number of nodes has increased, indicating the accelerating adoption of LN usage.
According to statistical data, the Bitcoin Lightning Network capacity has increased to 5,000 BTC (about 11.3 billion yen). This refers to the total amount of BTC liquidity placed in separate channels, meaning that the entire network has become easier to process higher value transactions.
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