56% of America’s Largest Companies Are Now Building in Web3
TL;DR
Web3 initiatives in Fortune 500 companies are up 39-56% YoY, likely in an attempt to access wealthy crypto customers (in the near term) and save on transaction fees (in the long term).
Full Story
We read Coinbase’s "State of Crypto: The Fortune 500 Moving Onchain” report, so you don’t have to!
The headline stats:
Reported web3 initiatives by Fortune 100 companies has increased 39% year-over-year (hitting a record high in Q1 2024)
56% of Fortune 500 say their companies are working on onchain projects (inc. consumer-facing payments applications)
Onchain stablecoin settlement volumes reached all-time-highs in Q1 ‘24 (w annual settlement volumes hitting $10T in 2023)
“Ok, but why is this happening?”
In the near term:
There’s a lot of new wealth tied up in crypto, with very few ways for holders to efficiently spend it.
By adding easy-to-use crypto payment rails to their tech stack, companies can convert more people into paying customers.
We’ve seen this work wonders in web2:
Amazon’s one-click checkout
Afterpay’s buy-now-pay-later
And Visa/Mastercard’s tap-to-pay
All of these technologies made massive improvements to customer conversion rates, simply by making the checkout process smoother.
In the long term:
Crypto payments are CHEAP!
Brick-and-mortar retailers tend to have average profit margins between 0.5 and 4.5% - that's razor thin.
Visa, Mastercard and American Express charge merchants anywhere between 1.29% - 3.29% (+.05c - .10c) in transaction fees.
A $100 purchase using the cheapest possible credit card option, would cost merchants $1.34 in transaction fees.
Cheap crypto networks like Solana charge a flat ~$0.00025 per transaction - making crypto payments 5360x cheaper, on a $100 purchase.
The result: a potential savings of billions per year on transaction fees.
Alright, now you know!