Firms involved in payment services are unwilling to accept Bitcoin despite the new policy that makes the currency a legal tender in El Salvador. Even though Bitcoin has been adopted as a lawful means of payment, service companies still find it difficult to accept it as such.
Kenneth Suchoski, a financial analyst told Reuters that payment companies will only comply to the rule of law on the insistence of their clients. He said that in payment firms like Western Union, there is always a market movement from the developed to emerging markets predominantly amongst households and comrades who transact with cash. According to Kenneth, not up to 1% of international transactions are done with crypto holdings, hence even if Bitcoin is not accepted, remittance companies will still have their place for a long time.
The conglomerate remittance company, MoneyGram International also noted that the technicalities involved in providing a suitable ground for both crypto holdings and fiduciary money in a developing economy will be tasking. According to MoneyGram spokesman, the company has established a link between electronic currencies and fiduciary money. As crypto and other electronic currencies gain relevance, a continual ramp with fiduciary money will hinder the growth process.
In the previous month, the international company collaborated with Coinme, a move that enabled customers trade crypto holdings with USD at 120000 retail points in different parts of the U.S. Kenneth stressed on the regulatory burdens of adopting crypto assets by remittance companies, a case study being the Western Union yearly regulatory burdens which is twice its original amount. It has increased from $100 to $200 million over the last ten years.
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