Cryptocurrencies, or cryptos for short, has been one of the sectors driving volatility in the market. Institutional investors in increasing numbers are beginning to take positions in digital currencies. Combine increased demand with a timely tweet or two from, say, Elon Musk and you have the perfect storm for the kind of volatility we’re seeing.
However for cryptos to become more than a bubble, they need to be accepted as a medium of exchange. That may be happening.
In fact when I was creating this list, I was genuinely surprised by how many companies already accepted cryptocurrency in one form or another. Many, like Best Buy (NASDAQ:BBY), allow Bitcoin to be used to purchase a third-party gift card. The cryptocurrency is converted to fiat currency at the time the gift card is purchased or at the point of purchase. Does that mean they “accept cryptos?” I’m not sure. But as not to confuse the issue, I left those companies off.
So to my knowledge (although it may change by the time you read this) here are seven companies that don’t yet accept cryptos, but should consider doing so:
- Amazon (NASDAQ:AMZN)
- Alibaba (NYSE:BABA)
- McDonald’s (NYSE:MCD)
- DraftKings (NASDAQ:DKNG)
- Dell (NYSE:DELL)
- Live Nation Entertainment (NYSE:LYV)
- General Motors (NYSE:GM)
Ok, I’m cheating a little on this one. Shoppers on Amazon can use Purse.io to connect people who want to use Bitcoin with individuals who want to get the digital currency as payment for fulfilling an order. That’s not the same thing as paying directly with cryptos, and so I’ll put Amazon on this list (call it an ‘honorable mention’).
Amazon also has “Amazon Coins” a virtual currency that allows people to pay for Amazon products or items in internet games.
But it would appear that Amazon can bide its time. It’s already incredibly easy for customers to place orders with Amazon. And with AMZN stock up over 475% in the last five years, I could buy the argument that cryptos may need Amazon more than Amazon needs cryptos. That compelling math may keep the site from adopting the use of cryptocurrency.
But rumors are circulating that Amazon is preparing to launch its own digital currency. Earlier this month, Coindesk reported that Amazon had two job postings looking for talent to launch a digital currency project in Mexico.
The “Amazon” of China also does not accept crypto at this time. Alibaba’s founder Jack Ma has expressed skepticism about the currency and has publicly stated that the company had no immediate plans to use Bitcoin or any cryptocurrency. However there is some speculation that Alibaba is looking into blockchain technology. This may be tied to the Chinese government’s plan to introduce the digital yuan.
Also like Amazon, Alibaba creates a back door for Bitcoin by allowing debit cards to be redeemed through Aliexpress. Consumers can fund a “traditional” debit card with Bitcoin and have it automatically converted to fiat currencies when making purchases. There are also some Bitcoin debit cards that automatically convert to fiat currency at the point of checkout. Users can also purchase gift cards with Bitcoin for use on the site.
BABA stock continues to offer investors with strong capital growth fueled by the company’s 425% growth in its core e-commerce and cloud services businesses over the last five years.
Here’s another company that I’m cheating on a little. McDonald’s restaurants do not currently accept cryptos. However, in select areas the company accepts Bitcoin donations to the Ronald McDonald House.
It makes sense that the company will bring cryptocurrencies under its golden arches sooner rather than later, particularly if acceptance of Bitcoin becomes a competitive advantage on rivals such as Burger King and Kentucky Fried Chicken.
And it’s clear that McDonald’s is testing the cryptocurrency waters. McDonald’s Ireland is engaged in a blockchain pilot to streamline its advertising activity. And McDonald’s Thailand is using Omise’s payment gateway which is adjacent, although not identical to the OmiseGo blockchain.
However, like Amazon, McDonald’s may have time on its side. Whether you love or hate the food, McDonald’s has been a clear winner during the pandemic. Although closed to dine-in eating, the restaurants have remained open. And MCD stock is up 53% from its early pandemic plunge.
DraftKings has been a solid bet for investors. And it should continue to do so whether or not the company decides to accept cryptos as a way for customers to fund their accounts. Currently the company accepts all major credit cards as well as PayPal (NASDAQ:PYPL).
However the benefits of accepting crypto deposits (not regulated by a centralized bank or third party and reduced processing times and fees) may be too tempting for DraftKings to pass up. Essentially, sports betting was made for cryptocurrency and vice versa.
DKNG stock is in the midst of a strong rally since the return of college and professional sports. The stock is up nearly 35% since the beginning of the year. That may slow any need for the company to adopt cryptocurrency, but competitor FanDuel already accepts Bitcoin. And that means if customers begin to demand it, it’s likely that DraftKings will look to adopt cryptos as well.
Could love be better the second time around? That’s my only reason why Dell could start accepting Bitcoin … again. Dell was one of the first companies to accept Bitcoin in 2014. At the time, itwas a huge shot in the arm for Bitcoin that needed to find use cases for the digital currency.
However, Dell ended its association with cryptos in general, and Bitcoin specifically in 2018. The company said demand for the currency was too low to make it viable.
So why might the company reconsider its relationship with cryptos? If you’ll allow me to spitball an answer, I’ll say that in 2014, Dell was a privately held company. But the company went public for the second time in 2018 and let’s just say it’s going well.
DELL stock is trading at all-time highs and the company is expecting strong PC sales for the year. And with cryptocurrencies now being accepted at an increasing number of merchants, this time around the timing may be perfect.
Live Nation Entertainment (LYV)
Live Nation Entertainment is making a big bet that concerts and other forms of public entertainment will reappear sometime in 2021. That’s reflected in the LYV stock price, which is up nearly 30% for the year.
And when live events return, could it be possible that the company will offer cryptos? They don’t at this time, but that could be changing. Here’s why.
In 2018, the company acquired UPGRADED, a blockchain technology company. The purpose was to convert traditional tickets into interactive digital assets. This benefits event creators with more control and visibility over how their tickets are distributed. And fans are protected against fake tickets.
At the time, Justin Burleigh, Ticketmaster’s chief product officer, the company “is constantly exploring emerging technologies, and there aren’t many that have the unique possibilities of blockchain.” At the time, Burleigh didn’t talk about the company accepting cryptocurrency. If the company does decide to accept Bitcoin or other cryptos, it’s unclear whether the company would want to buy cryptos themselves.
General Motors (GM)
You have to hand it to Elon Musk. As soon as Musk announced that Tesla (NASDAQ:TSLA) would accept Bitcoin, the questions began of which other auto makers would follow suit. Leaving behind the question of if Tesla is an auto manufacturer, it’s interesting to ponder.
Even legacy auto makers are embracing electrification. And along with that type of car comes a certain type of customer. And that customer may be more accepting of paying with cryptos. General Motors has made a commitment to electrification through its Ultium Platform. The company is pledging to have an all-electric fleet by 2035, with 30 new EVs available by 2025.
However when asked about Bitcoin, CEO Mary Barra said the company “has no immediate plans to invest in Bitcoin.” Instead, the Detroit auto giant will continue to “monitor and evaluate” the possibility. Given the difference between the GM stock price and that of TSLA, Barra’s decision will ultimately be influenced by the fortunes of Tesla.
On the date of publication Chris Markoch did not have (either directly or indirectly) any positions in the securities mentioned in this article.
Chris Markoch is a freelance financial copywriter who has been covering the market for seven years. He has been writing for Investor Place since 2019.