Even if you’re not always tuned to the news, you would have noticed that the global markets are experiencing instability in the banking sector, with persistent inflation and geopolitical tensions. All of these affect the way we do business both locally and globally. In response to these challenges, businesses are now turning to Alternative Payment Systems (APS) which include mobile wallets and cryptocurrencies.
APS, so far, is proving to be reliable and resistant to these global market challenges. Although it provides convenience to both businesses and customers, it is more about responding to the structural issues in traditional payment systems. Ideally, APS would not be a replacement but an add-on to existing payment systems. But today, these alternative systems are becoming more popular, particularly cryptocurrencies and stablecoins, with some businesses adopting them as their sole payment method.
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Cryptocurrencies and Stablecoins
Not too long ago, cryptocurrencies used to be speculative assets with many governments around the world either banning or warning against them. Today, its market capitalization has grown to reach about $3 trillion. Major economies like the United States have fully embraced digital assets with adequate regulations in place. On March 6, 2025, President Trump approved an Executive Order to create a Strategic Bitcoin Reserve and a U.S. Digital Asset Stockpile. For online businesses, particularly those already experimenting with crypto payments, this is an endorsement that they are on the right track. Apart from institutions, smaller niches like online casinos are using as an alternative payment method, digital assets like Bitcoin and USDT, for players who value anonymous, instant, and easy international transactions. These online platforms offer instant transactions and low fees in addition to improved privacy and anonymity.
Speaking of international transactions, stablecoins like USDT (Tether) have gained preference in developing countries for cross-border payments because they are pegged to the U.S. dollar. By choosing USDT, the value of the dollar compared to their local currencies is maintained or even improved. In Nigeria, for instance, the average exchange rate was about ₦370 to the dollar in 2020. As of March 2025, it is over ₦1,500. Nigerians earning in dollars now gain more in currency value than they would if they were earning in the local naira.
Mobile Wallets and Fintech Solutions
Even though crypto seems to be getting all the attention lately, fintech solutions have been around for years addressing these very global market challenges. The major players in this space currently are Cash App, Venmo, Apply Pay, and Google Pay. In 2024, Cash App reportedly generated $16.2 billion in revenue, and $5.23 billion in gross profit, from 24 million users. The revenue, mostly from transaction fees, was up by 13% from the previous year, showing that more individuals (typically tech-savvy millennials) and businesses are embracing wallets instead of traditional banking accounts.
There is also an increase in Buy Now, Pay Later (BNPL) platforms like Afterpay. Such platforms allow users to make instant purchases and pay later but with much lower interest rates compared to traditional credit cards from banks. Afterpay is also a growing platform with 24 million active users and up to $27.3 billion in revenue, as of 2023. The Consumer Financial Protection Bureau (CFPB) in the US is currently looking into the long-term impacts of BNPL platforms.
FedNow and Real-time Banking
The U.S. government is very much aware of the challenges in traditional banking and is trying to address them. One of the solutions it came up with in 2023 was FedNow, developed by the Federal Reserve, the government’s attempt to modernize local payments. Even though it is a good solution for reducing settlement time and increasing bank transfer speed, adoption has been slow. Smaller banks, for instance, are still struggling with technical integration with their system.
Also, FedNow doesn’t offer cross-border transactions, a niche that could boost its adoption. This is where Bitcoin and USDT shine. They help to bridge the gap between the U.S. and international transactions with lower fees and instant settlements.
Geopolitical Tensions and the Need for Payment Diversification
Escalating geopolitical tensions can significantly impact both local and international trade. For example, the ongoing trade dispute between the U.S. and China has led to President Trump imposing increased tariffs on goods from China. In February 2025, the tariff was an extra 10%, with an additional 10% added. As China battles this out through the World Trade Organization (WTO), trade settlements remain at risk. To protect themselves, businesses that deal in global supply chains are moving to stablecoins like USDT as they don’t have to worry about volatility or the aftermath of sanctions. With stablecoins, they get the exact U.S. dollar value for their exported and imported products. This also makes an APS like crypto a preferred option for international trade, especially during periods of geopolitical tension.
