Many clients come to us asking for advice on which blockchains and tokens they should support when integrating crypto and stablecoin payments into their e-commerce website or app. Today, Orbital is a leading provider of blockchain-based payments for hundreds of global businesses, processing millions of on-chain transactions each year, valued in the billions of Dollars. To help address this question for our clients and other businesses considering integrating crypto payments for the first time, we decided to write this blog post on the state of the market today.

Blockchain Payments in Developed Markets

In developed countries (e.g. North America, Europe), consumers have ubiquitous access to traditional payments like Visa/MasterCard, bank transfers, and local payment schemes. These rails generally work efficiently from a consumer UX perspective and are readily available to merchants. This leaves little motivation for consumers or merchants in these markets to adopt crypto payments. Additionally, most users in developed countries view cryptocurrencies as speculative investments rather than a utility, providing even less incentive to spend them. Furthermore, spending crypto is typically considered an asset disposal, potentially triggering a CGT tax event, making it even more unattractive the payments use case.

Stablecoin Adoption in Emerging Markets

In contrast, the situation is very different in emerging markets (e.g. Africa, Asia, Latin America). Major payment networks like Visa/MasterCard often have minimal penetration in these regions. Historically, global merchants wanting to sell their products in emerging markets had to integrate a patchwork of local wallets and alternative payment methods (APMs) for each target country. This process is time-consuming and resource-intensive, presenting challenges from a treasury and cross-border liquidity perspective.

However, blockchains have rapidly become a disruptive alternative. Cryptocurrency and, more recently, stablecoin adoption has been exploding in many emerging markets worldwide (Nigeria, Turkey, Argentina, India, Vietnam, Brazil, etc.). Consumers are quickly realising that stablecoins provide access to a Digital Dollar that they can hold and transact without even needing a bank account. The appeal of US Dollars is not new. Consumers in emerging markets have long had an appetite for holding the world's reserve currency, but historically in the form of paper notes. Dollars are considered a hedge against local currencies, which are at risk of rapid inflation and have little international value. The ease of access and utility value of blockchain-based dollars (stablecoins) have resulted in massive adoption by consumers (20-50% in many emerging markets), making them the perfect medium for cross-border commerce.

Take a look at the Top 10 Countries in the 2023 Global Crypto Adoption Index by Chainalysis:

7 out of the top 10 countries with the highest crypto adoption index in 2023 are low-to middle-income (LMI) countries according to the World Bank Country and Lending Groups. And 9 out of the 10 countries in the top list are emerging market countries.

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USDT Payments on TRON

Tether (USDT) holds the position of the largest stablecoin issuer with a market capitalization of $112 billion and market dominance of >75% among stablecoins, with over 50% of its issuance on the TRON blockchain.

Source: TheBlock

TRON is now the leading network for USDT transactions, reflecting its growing popularity and demand as a payment method. Its platform offers scalability and cost efficiency, attracting more businesses and users to its services. According to the data from Allium, 38.6% of all stablecoin addresses used during the last 30 days belong to USDT on TRON wallets.

Monthly Active Stablecoin Users, source: Allium

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Benefits for Merchants

The benefits to merchants are also clear: integrate a single payment rail that covers almost every emerging market globally, with significant consumer access, 80% lower fees, no  chargebacks, and instant settlement.

This combination of factors has led to explosive growth and adoption from both consumers in emerging markets and international merchants wanting to sell to them. Knowing that blockchain payments have little value to consumers in developed countries, and understanding from our clients that they are specifically selling into emerging markets, we estimate that over 99% of our payments come from emerging markets.

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Choosing the Right Blockchains and Tokens

Now, addressing the question of which blockchains and tokens are most relevant, using our data of hundreds of thousands of transactions from the last quarter, we see a very clear trend in terms of which blockchain users in emerging markets prefer. Here are the key findings from Orbital data:

• 98% of all Orbital stablecoin transactions occurred on the TRON blockchain.

• 99% of all stablecoin transactions were in Tether’s USDT token.

• When expanding to include all cryptocurrencies processed, USDT on TRON still made up 96% of all transactions processed.

• When looking at the type of wallet that end users are making payments from, 75% sent their crypto from an exchange, and 24% from a self-hosted wallet. 

• Additionally, 95% of payments from exchanges and 89% of payments from self-hosted wallets were via the TRON blockchain.

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In summary, however you cut and slice the data, it is abundantly clear that users in emerging markets firmly favour transacting in USDT specifically on the TRON blockchain. We strongly recommend all merchants and international businesses looking to make or receive payments to/from users in any emerging markets around the world to offer USDT on the TRON blockchain to meet the demands of consumers in those countries.

By understanding these dynamics and adopting the right strategies, businesses can effectively tap into the growing market of blockchain payments in emerging economies.

Discover how Orbital can skyrocket your crypto stablecoin payments and schedule a demo with our team by visiting our website.

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DISCLAIMER: Services related to cryptoassets aren't authorized by the FCA & are only directed at and available to corporate customers outside the UK.