Cryptocurrencies (crypto for short) such as Bitcoin (BTC) and Ether (ETH) are increasingly becoming more a part of the mainstream and gaining traction as a means for payment.
This naturally leads us to wonder, where is crypto’s place in air travel and should airlines embrace this alternative payment option? Let’s dive in and find out.
Travelers Significantly More Likely to Own Bitcoin Than the General Public
According to a study and analysis from Morning Consult, travelers are significantly more likely to own Bitcoin than the general public.
Interestingly, there also seems to be a correlation between Bitcoin ownership and how often one travels. Those who travel at least five times a year are more than twice as likely to own Bitcoin than the general public.
Something to consider here is that there is likely also a socio-economic factor to consider among those who are able to travel frequently.
While this study provides a solid baseline for general travelers, we thought we’d go an extra layer and specifically look at aviation.
Although far from scientific or a large enough sample size, we ran a poll on our LinkedIn page asking our followers (who are heavily skewed towards the aviation and travel sectors), specifically about purchasing a flight using crypto.
Again, as you can see, we received a small number of respondents, but 40% did say they would buy a flight with a cryptocurrency, if given the opportunity. While we cannot derive any final conclusions from such a poll, we did see it as a signal to further investigate.
What’s Currently Happening with Airlines & Crypto?
Back in 2014, airBaltic issued a press release claiming to be the first airline to accept Bitcoin.
According to the press release, “airBaltic accepts Bitcoin as payment for tickets on its website www.airbaltic.com. The ticket prices on the website are displayed in euros. When airBaltic customers pay for their flight, their Bitcoins are converted into euros at the current exchange rate.”
As of today, the carrier still accepts Bitcoin via Bitpay and now also accepts other crypto such as Bitcoin Cash, Ether and Dogecoin.
It does come with a caveat, however. According to airBaltic’s payment options page, the payment option is only available for certain fare classes and must be booked at least five days before departure.
As of March 2021, airBaltic claimed to have transacted about 1,000 payments with its cryptocurrency payment option.
"Universal Air Travel Plan (UATP) announced in September 2021 that it would bring more than 300 airline members and travel merchants cryptocurrency payment options."
These airlines were among the early adopters, but crypto payments have a huge growth opportunity. Universal Air Travel Plan (UATP), which is an airline-owned global payment network accepted by thousands of merchants worldwide, announced in September 2021 that it would bring more than 300 airline members and travel merchants cryptocurrency payment options via a partnership with Bitpay.
Currently, UATP’s members include the likes of Aeromexico, British Airways, Lufthansa, Air Canada, Air China, Air New Zealand, Delta Air Lines, American Airlines, Etihad Airways, Frontier Airlines, Japan Airlines, JetBlue, Qantas Airways, Southwest, Sun Country Airlines, Transavia Airlines, Turkish Airlines, United Airlines, WestJet and many more.
Other Booking Options
Direct bookings are not the only way for travelers to purchase flight tickets with crypto. Third-party sellers such as CheapAir.com, Destinia.com, Traval.com, XcelTrip and Alternative Airlines offer up options for travelers to use their crypto to buy tickets.
Kambr Media caught up with Alternative Airlines’ Digital Marketing Executive and resident crypto expert Mohammad Khan to get some further insights.
"In terms of ourselves, we’ve got to empower people to pay for flights in any way that they want and there’s a huge, growing number of people that want to use cryptocurrency for travel and flights," said Khan.
"We process 1.5% of our revenue via cryptocurrencies. While it’s not a huge number, it’s one that is growing. In 2021, our annual revenue was £28m, so £400,000 per year is from cryptocurrency.”
Alternative Airlines sees crypto as a huge growth opportunity and is doubling down on the digital assets as a payment option.
"In terms of ourselves, we’ve got to empower people to pay for flights in any way that they want and there’s a huge, growing number of people that want to use cryptocurrency for travel and flights."
"We’ve embraced 3 crypto providers since the beginning, including the likes of Utrust, Crypto.com and the recent one being CoinGate and now offer almost 90 cryptocurrencies on the site for our customers to use," said Khan.
"With the huge potential of cryptocurrency in the travel market, we’ve given the opportunity to the people within the crypto community a way to pay for something that wasn’t widely available to them before."
While cryptocurrency payments do not represent huge transaction volumes, evidence does suggest there is growing desire and growing support to at least have them as a payment option to purchase flights.
Even if crypto transactions never reach critical mass, airlines who embrace them can be positioned as being innovative and customer centric.
Any measures in which airlines can reduce payment friction and improve the customer experience should be adopted.