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Its reputation may be tarnished in the financial and investment worlds, but cryptocurrency remains well-suited for charter transactions, according to a legion of boosters, as the digital coins\u2019 quick, low-fee transfers and blockchain traceability make it ideal for such payments.<\/p>\n
Many of these advocates note that despite charter\u2019s \u201cready when you are\u201d ethos, airplanes don\u2019t move until operators get paid. And crypto transactions can be the best solution for transferring tens or hundreds of thousands of dollars after banking hours or avoiding high bank transfer or credit card fees.<\/p>\n
The demand is reportedly driven by a younger, crypto-savvy clientele\u00a0and facilitated by payment processors that support the transactions.<\/p>\n
\u201cA growing number of individuals are holding cryptocurrencies and are willing to spend it, and they are ignored by many [charter] companies,\u201d said Simona Moosar, business development manager at Ecommpay, a European e-payment processor that handles such payments for some two dozen charter firms among its clients. The biggest advantage for providers accepting crypto payments for charter, according to Moosar: \u201cYou can actually attract a completely new clientele.\u201d<\/p>\n
Recent data indicates between 23.3 million and 27 million Americans own Bitcoin, the first and still dominant cryptocurrency, but data on the extent of its and other cryptocurrencies’ use for charter payments is sparse. This is because payment processors don\u2019t make the information public, while some providers cite only rough uptake percentages. But growth reportedly continues, despite this spring\u2019s dramatic collapse of cryptocurrency values.<\/p>\n
\u201cWe are aware of the skepticism toward buying crypto,\u201d said Mauro De Rosa, CEO of Italy\u2019s Fast Private Jet, which claims the currency accounts for 30 percent of its business.\u00a0\u201cBut paying with crypto is another story.\u201d<\/p>\n
At the time of the currency crash, Eymeric Segard, CEO of Switzerland\u2019s crypto-friendly LunaJets, wrote in the company\u2019s EBACE newsletter, \u201cThe crypto wealth effect may disappear as fast as it stormed our industry.\u201d But his doubts have since subsided: \u201cWe have seen no effect on CRY[coin]-paid charter following the recent loss of value of CRY,\u201d Segard told AIN<\/strong> on the eve of NBAA-BACE. Some of his customers, he noted, \u201ccould still be making a profit when spending [cryptocurrency].\u201d<\/p>\n Crypto transactions first came to air charter in 2014, five years after the digital currency\u2019s introduction. That’s when UK-based retail booking platform PrivateFly, now part of Directional Aviation\u2019s OneSky portfolio, enabled charter payments in Bitcoin.\u00a0In the U.S., Florida-based Monarch Air Group introduced a crypto payment option in 2017.<\/p>\n \u201cTraditional transactions still account for the vast majority of our flights\u00a0and will continue to do so in upcoming years,\u201d<\/span> said Monarch executive director David Gitman. \u201cBut our clients asked for this alternative and we delivered.\u201d<\/p>\n North Carolina-based charter, jet card, and fractional fleet operator flyExclusive began accepting crypto payments last year for both charter and jet card purchases \u201cas another way to deliver value, convenience, and premium service for our clients,\u201d said president Mike Guina.<\/p>\n Florida\u2019s Stratos Jet Charters adopted the payment option this year. \u201cWe felt accepting crypto would dramatically reduce our risk versus credit cards,\u201d said company\u00a0CEO Joel Thomas.<\/p>\n Fee-wise, cryptocurrency transfers typically cost about 1 percent of the amount transferred\u00a0versus credit card fees that can range from about 3 to 6 percent. Bank wire transfer fees vary and can take several hours or one or two business days when sent internationally.<\/p>\n As for transacting with a currency subject to dramatic volatility, customers can typically transfer and send the requisite amount of cryptocurrency from their digital wallets in 20 to 30 minutes. Processors say it arrives in the fiat currency dictated by the charter contract, eliminating any devaluation risk to the providers.<\/p>\n Some remain cautious. California\u2019s Amalfi Jets, which last year enabled Bitcoin payments for known clients, charges them an additional 20 percent transaction fee to \u201ccover the volatility of the market price\u201d of the digital coin.<\/p>\n One processor not onboard for cryptocurrency payments: Avinode Group\u2019s PayNode (Booth 4535). PayNode was launched at NBAA 2016 to offer quick e-payments among charter operators and brokers.<\/p>\n \u201cTraditional payment institutions feel the [charter] industry is risky as it is,\u201d said Avinode\u00a0chief revenue officer\u00a0<\/span>Per Marthinsson. \u201cCryptocurrencies need to evolve further for that risk appetite to be at an acceptable level.\u201d<\/p>\n Avinode believes cryptocurrencies also \u201cstill face quite a number of issues when it comes to KYB, KYC, and AML,\u201d he said, referring to \u201cknow your business,”\u00a0“know your customer,\u201d and \u201canti-money laundering\u201d standards and requirements, respectively.<\/p>\n Avinode is, of course, an avowedly B2B platform that has always eschewed the retail market. And with the transfer capabilities PayNode offers, Marthinsson said, \u201cBetween brokers and operators for a wholesale transaction, there\u2019s very little need for Bitcoin.\u201d<\/p>\n Meanwhile, the long-term appetite for crypto charter payments remains unclear. At LunaJets, the payments currently \u201caccount for less than 10 percent of our revenue, but [they\u2019re] growing every quarter,\u201d said Segard. Conversely, while first adopter PrivateFly previously reported crypto transactions accounted for up to 20 percent of bookings, \u201cpayments made in this way currently account for less than 10 percent of transactions,\u201d PrivateFly European managing director\u00a0<\/span>Marine Eug\u00e8ne\u00a0told AIN<\/strong>.<\/p>\n At least three additional exhibitors at NBAA offer payment processing services: BHG Financial (Booth 2219); TreviPay (Booth 4513); and World Fuel Services (Booth 4800), which holds a majority stake in Avinode. AIN <\/strong>did not receive responses to questions about these companies’ cryptocurrency policies or plans before press time.<\/p>\n<\/div>\n