Whiplash could result from the rapid pace of crypto adoption, warns a wallet executive.

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In 2021, cryptocurrency acceptance is soaring, but how long will the celebrity-fueled hype train last?

Cryptocurrency usage on a payment app headquartered in the United Kingdom is booming in the first quarter of 2021, but if that development persists depends on the activities of Bitcoin (BTC) evangelists like Elon Musk, warns STICPAY director James Bay.

In the first quarter of the year, the mobile payments app announced a 48 percent growth in crypto deposits, while fiat deposits remained unchanged. Bitcoin seems to be the currency of preference for the majority of STICPAY e-wallet users, with Bitcoin deposits outnumbering Ether (ETH), Tether (USDT), and Litecoin (LTC) deposits 38 times over.

In addition, the company announced an 185 percent rise in the number of users exchanging fiat to crypto using the wallet’s built-in currency converter as compared to the same time last year. This was followed by a 12% drop in the number of people converting crypto to fiat.

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Client service director James Bay said more cryptocurrencies were gaining reputations as potential stores of value but said Bitcoin was still at the forefront.

“Cryptocurrencies are increasingly being accepted as a trusted store of monetary value. But we have to say it’s Bitcoin that’s leading the change in payment habits and outlook that’s challenging fiat currencies,” said Bay.

“The switch to cryptocurrencies is moving at breakneck speed, but whether that trend continues remains to be seen,” warned Bay, whose comments come as the cryptocurrency market experiences a violent dip after months of rapid growth.

The continuity of the movement, according to Bay, may be dependent on the behaviour of public figures such as Elon Musk, whose popular tweets have been seen to raise (or sink) the prices of whatever coin he mentions.

“Even today, high-profile Bitcoin evangelist Elon Musk announced Tesla will no longer accept the currency citing environmental concerns, all of which follows March’s announcement that the business would accept payment in Bitcoin,” said Bay, referring to Elon Musk’s abrupt turnaround on Tesla’s decision to accept Bitcoin as a payment option for its electric vehicles.

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On May 13, hours after Musk’s turnaround on Bitcoin transfers, another high-profile Bitcoin evangelist, MicroStrategy’s Michael Saylor, announced the acquisition of another 271 BTC. The overall amount of Bitcoin on MicroSTrategy’s balance sheet is 91,850 BTC, with varying sums obtained at various rates since last year.

Meanwhile, more than $1 billion in Bitcoin rests on Tesla’s balance sheet, drawing criticism from industry insiders who see Musk’s ability to benefit from a coin he considers environmentally dangerous as a sign of hypocrisy.

 

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