One of the top five-star hotels in Switzerland has already started accepting bitcoin payments on May 1.
The Dolder Grand initially revealed in March that it would start receiving cryptocurrency as payments for products and services at the hotel such as spa treatments, reservations, and food. The Dolder Grand managing director Mark Jacob said through CNN Money that they were trialing bitcoin for its potential in the payment industry, stating that they didn’t fully comprehend its potential.
“Whether exactly this [bitcoin payment] solution will be a permanent and sustainable solution, we don’t know,” Jacob said, adding that, “When you are the first mover or part of the first ones that move, there is always a risk that the solution will not gain traction. But I think it would be a failure if you don’t give it a try.”
The comments came following instances when retailers discontinued accepting bitcoin payments because the service didn’t gain traction for them. Blockchain firm Chainalysis said that bitcoin’s use in commercial payments decreased as much as 80 percent last year. Several big companies dropped the bitcoin payment option, mentioning regulatory and price volatility issues. Gaming platform Steam particularly discontinued the crypto payment option after one year, citing steep transaction fees. Payment processor Stripe and travel management portal Expedia also dropped the service.
In Switzerland, however, there’s a growing interest in bitcoin from businesses. Jacob believes the positive outlook comes from the affluent crypto-based environment, which guarantees merchants receive sufficient regulatory and peer support when accepting bitcoin payments.
“It’s a fascination for the crypto valley in Zug and also the Zurich crypto community and the environment that is there and to support them also. I think Switzerland has always been a very innovative country. We, as a hotel, also benefit from that very directly in terms it drives businesses to Switzerland,” he said.
Skeptics, however, are also on the rise in attacking bitcoin. Oliver Herren of Digital Galaxus Group, one of the country’s biggest online stores, said that bitcoin’s transaction fees cost more than a conventional payment service. He also mentioned bitcoin’s lack of scalability—the capacity to process transactions as quick as MasterCard or Visa.
“None of the blockchains scale enough. But maybe I have not invested enough time and therefore understand too little how the blockchain ecosystem works,” Herren stated.
The decrease in bitcoin’s price last year has pushed the adoption lower. However, the cryptocurrency is showing signs of recovery, which means a more positive outlook for this year. Bitcoin Association Switzerland president Lucas Betschart said:
“I expect more Swiss companies to accept bitcoin over the next two years to attract tourists who save money by paying bitcoin.”