CUNA Senior Economist Ligia Vado discusses cryptocurrencies, risks and trends, and consumer interest in the latest CUNA Economic Update. 

“It is important to recognize that this space, this market for digital payments, is here to stay,” says Vado. “Consumer preference toward more digital forms of payment was accelerated by the COVID-19 pandemic.” 

Analyzing recent CUNA polling regarding who is using cryptocurrencies, Vado notes credit union members are more than twice as likely as nonmembers to own a cryptocurrency. She also provides a deeper look at the types of users engaging with the digital assets and their mindset in doing so. 

Vado analyzes the risks that cryptocurrencies preset for users and for credit unions.  

“The main risk for credit unions in the extreme case in which consumers massively adopt digital forms of payments is the risk of disintermediation," she says. "This means consumers would not be incentivized to keep their deposits in credit unions, and so credit unions will see a reduction in their funding sources."

Vado closes by noting credit unions should be granted the flexibility to offer digital asset custodial and management services to their members.