# 8. The Problem Statement

## Crypto Isn’t Spendable (Yet)

Despite explosive growth in cryptocurrency ownership, the average person still can’t use digital assets for everyday expenses. Most crypto remains siloed within exchanges, trading apps, or wallet interfaces — disconnected from the places where people shop, eat, travel, and live.

PaywithCrypto addresses this critical disconnect by solving the following pain points:

&#x20;8.1. Real-World Inaccessibility

●        Millions of merchants still can’t accept crypto.\
From barbershops to convenience stores, most local businesses lack the tools or knowledge to accept digital payments via blockchain.

●        End users can't spend crypto offline.\
Despite having USDT or ETH in their wallets, crypto holders are forced to rely on OTC desks, informal brokers, or cash withdrawals — defeating the purpose of digital finance.

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8.2. Complex & Fragmented UX

●        Crypto payments are not intuitive.\
Terms like “gas fees,” “non-custodial wallets,” and “bridges” confuse non-technical users. Sending a simple payment feels more like coding than paying.

●        No unified interface exists.\
Users must juggle exchanges, wallet apps, QR generators, and fiat channels — just to complete a basic transaction.

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8.3. Centralized Exchanges Dominate the Flow

●        Over 90% of daily crypto volume remains within centralized systems.\
Traders speculate, but very few use crypto to actually transact.

●        Exchanges act as bottlenecks.\
Fiat off-ramps are slow, require high fees, and often fail for users in underbanked regions.

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8.4. Lack of Localized Fiat Conversion

●        Even crypto-rich users can’t use their funds freely.\
For example, in Phuket, Thailand, tens of thousands of Russian expats use USDT as their primary currency — yet must convert it manually via OTCs to pay for food or rent.

●        Regulated on-ramps/off-ramps are scarce.\
Few solutions combine real-time conversion, QR-code usability, and fiat settlement into local business accounts.

8.5. Compliance Without Compromise is Missing

●        Regulatory gray zones stifle adoption.\
Merchants are hesitant to touch crypto due to uncertainty around taxation, legality, or fraud risk.

●        Most crypto payment tools skip AML/KYC.\
This leaves businesses vulnerable to blacklisted transactions, wallet exploits, and legal penalties.

&#x20;8.6. Merchants Still Lose Money

●        Traditional payment rails (Visa, Mastercard) charge 2.5%–4% per transaction

●        Crypto solutions that do exist still charge 0.5%–2%, or require wallet lock-ins

●        Hardware POS devices often cost thousands or require monthly SaaS fees

●        Small businesses are priced out — and pushed away

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&#x20;The Result?

●        Crypto is held but not spent.

●        Merchants are interested but not equipped.

●        Users are willing but frustrated.

●        Billions in value remain stuck in wallets, while real people still pay in cash.

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