Crypto has created high-end consumers
From Teslas to watches, we are already seeing high-end brands jump into the crypto market.
Phillip Plein, a Germany-based designer and design house, was one of the first major fashion brands to accept crypto as payment in August 2011, when the price of one Bitcoin reached $30.00 for drop back down to $1.00.
Recently, Phillip Plein also launched a Web 3.0 concept store on the Metaverse, as the company expects more consumers and customers to start using crypto as a form of payment.
It wasn’t until 2017, when the price of BTC soared to over $10,000, that consumers and high-end brands started noticing the noise coming from the crypto market.
Today, the average BTC price is closer to $40,000, with prices reaching $67,000 as we experienced in November 2021.
In just over 10 years, we are now seeing luxury brands such as Hubolt, Franck Muller, and Norgain accepting crypto as payment in their stores. Swiss luxury watchmaker Hubolt has gone so far as to create a limited-edition range of BTC-inspired watches available for purchase via Bitcoin – all 201 limited-edition watches sold out during its pre-launch announcement.
Next, we see a luxury travel agent, Travala.com which now offers travel packages and promotions to high-end customers who prefer to pay in cryptocurrency. Some of their travel offers are exclusive to customers and are only available to travelers who can pay for them using crypto.
Fashion brand Off-White, which made over $7 billion in revenue last year, announced in April 2022 that it would now accept crypto as payment in some of its major flagship stores, including London , Milan and Paris.
In 2021, Sotheby’s Auction House sold Banksy’s ‘Love Is in the Air’ (2005) for $12.9 million, a one-of-a-kind sale that was paid for entirely using cryptocurrency .
We see GRT Super Yacht which, in early 2021, announced that it would embrace crypto-verse and allow its high-end customers to pay for their yachts with crypto, including BTC and ETH.
Of course, the best known of the past few years was when Tesla CEO Elon Musk tweeted that the company would accept BTC as a form of payment for its electric vehicles. Musk would later reverse that announcement, pointing out that the environmental impact of Bitcoin mining does not partially align with the company’s sustainability goals.
It wasn’t until late November 2021 that Musk made a move again, tweeting that certain services, goods and merchandise can now be paid for using the popular meme coin, Doge.
Tesla now only accepts Doge and has yet to make any further announcements regarding their acceptance of BTC and other major cryptos as payment.
Bitcoin has gone from being the same price as an ebook on Amazon Kindle to becoming the most traded and valuable digital asset of the 21st century. But not only is BTC leading this market, it has also helped set the playing field for other cryptos to be born, traded, and used in the DeFi market.
Apart from the fact that the value of crypto has increased tremendously, it has also become a namesake for high-end luxury brands looking to attract a new set of consumers to their stores.
It is only looking to become more prevalent in the years to come. Inside information from Stephen Pair, CEO of BitPay, revealed that transaction volumes related to luxury products paid for by crypto increased by more than 31% in 2021.
Additional insights indicated that merchants and crypto users are more likely to buy luxury items, with a typical AOV or average order volume of $450.00, while non-crypto users tend to have an AOV of $200.00.
While it makes sense for crypto traders and buyers to be more forgiving when it comes to using their crypto, designer brands have quickly caught the attention of these wealthy spenders and are now bringing their brand and offering directly to these consumers.
Cryptocurrencies have evolved from digital assets to physical assets that can now be used and transferred between merchants and businesses. Although their value has increased tremendously over the past few years, fashion and high-end consumer goods brands have understood the growing need for the use of crypto.
Instead of investors and traders having to leave their crypto in their digital wallets, luxury brands are now offering services and goods that they can spend their crypto on.
From expensive watches to electric vehicle-inspired merchandise to superyachts, the high-end market for luxury goods has become much richer and much more decentralized.