Today, few auto retailers accept cryptocurrency as payment, but experts predict that could soon change.
Stephen McKeon, associate professor of finance and a cryptocurrency expert at the University of Oregon, likens it to when the Internet was still relatively new and not everyone had an email address. He says that’s how cryptocurrency may be viewed about a decade from now.
Cryptocurrency also has some immediate, practical uses. McKeon cited a lack of fees and chargebacks for retailers and the near-instantaneous nature of the transactions. He also says cryptocurrency has little potential for fraud.
Even so, car buyers rarely use cryptocurrencies such as Dogecoin and Bitcoin to buy a vehicle, but changes during the pandemic show that could change.
Consider Carriage Auto Group, which accepted cryptocurrency as a form of payment since 2015, but few buyers ever took advantage of it. The pandemic turned this scenario on its head.
Automotive News reported that since March 2020, the group, which has four stores in Georgia and two in Alabama representing the Nissan, Kia, Mitsubishi and Mazda brands, averages two cryptocurrency transactions a month.
Christopher Basha, the group’s marketing and technology director, reported the move has cost nothing to offer, has reaped marketing dividends and has become a low-maintenance revenue stream.
Basha got the idea to accept cryptocurrency after watching a roommate who was "mining" Bitcoin and Litecoin, which involves using sophisticated computer equipment to attempt to create additional currency.
He placed a notice on Carriage Nissan's website saying the automotive group would accept cryptocurrency. No one took the company up on its offer for two years. Things picked up in 2017 when a customer at one of its Kia stores asked to pay in bitcoin. That customer referred others, and Carriage sold around eight vehicles with digital payments that year.
Carriage could be at the forefront of something that will eventually become more commonplace in auto retail, according to experts like McKeon.