KUALA LUMPUR (Dec 20): Twenty per cent of large organisations will use digital currencies for payments, stored value or collateral by 2024.

In a statement on Dec 16, technology research and consulting firm Gartner Inc said the prediction had important implications for chief financial officers (CFOs) as they assess use cases and potential risks for digital currencies, which will be used more in business transactions and grow in overall economic significance in the years ahead.

Gartner IT practice distinguished vice-president and analyst Avivah Litan said increasing mainstream acceptance of cryptocurrencies on traditional payment platforms and the rise of central bank digital currencies (CBDCs) will push many large enterprises to incorporate digital currencies into their applications in the coming years.

“Digital currencies will be primarily used by these organisations for payment, a store of value and the ability to leverage high-yield investments available in decentralised finance applications,” she said.

Gartner experts recommended that organisations first clarify specific use cases for digital currencies before evaluating appropriate IT stacks to incorporate them within the enterprise.

It said each primary use case comes with a host of technological, regulatory, legal and strategic considerations for both CFOs and application leaders to assess, including selecting appropriate service providers and the ability to monitor and react to ongoing regulatory guidance. 

Meanwhile, Gartner finance practice chief of research Alexander Bant said the firm noticed an uptick in interest in digital currency and blockchain applications among CFOs since the start of the year.

“While volatility of cryptocurrencies remains a concern, anticipation of clearer regulatory guidance and the advent of CBDCs now offer CFOs more avenues to pressure-test use cases for digital currencies,” he said.

Gartner’s prediction for wider adoption of digital currencies by 2024 is partly driven by the already healthy environment of service providers and off-the-shelf solutions available to large enterprises that have identified a specific use case for digital currencies. 

Litan said among the primary use cases for digital currencies that Gartner had identified, there will be no need for most organisations to develop a customised blockchain application stack.

“Many large banks, payment platforms, institutional digital asset custodians and wallet providers have already done the heavy lifting in this area, which should provide large enterprises with minimum friction in deploying their own digital currency applications,” she said.