Over the last couple of years, Mannheim has positioned itself as Germany’s first “cryptocity,” bringing digital assets into mainstream parlance, at least in the region. The initiative aims to facilitate seamless crypto payment experiences across the city’s retail stores, restaurants, and services. Backed by blockchain ecosystem Nimiq, the venture bridges the gap between digital currencies and traditional commerce.
According to Max Burger, Nimiq’s ecosystem development lead, the firm wants the current 6.7 million people in Germany who own cryptocurrency and around 20-30 million people in neighbouring European countries to have the opportunity to come to Mannheim and pay with their digital assets — be it for retail or gastronomy purposes.
However, the move isn’t just about enabling crypto payments but about creating a comprehensive ecosystem where cryptocurrencies are as commonplace as cash or card payments. In this regard, the initiative is taking a phased approach, with several drugstores, supermarkets, gas stations, and entertainment arenas having already signed up to accept crypto.
To elaborate, participating merchants can accept cryptocurrency payments from customers while still receiving Euros in their bank accounts, sidestepping potential currency fluctuations and tax complications. “People who own cryptocurrencies can spend them, but shops will continue to receive Euros,” Burger clarified.
Technology at its Core
The technological backbone of the Mannheim crypto city initiative is extremely innovative, with Nimiq Pay standing at the forefront of this revolution. As the first crypto payments app to incorporate cross-chain atomic swaps with the BTC Lightning Network, it can enable transactions at over 15,000 global payment locations.
For Bitcoin payments, the platform has partnered with OPAGO, which has developed a device where merchants can enter amounts in fiat, generating a QR code scannable by any standard wallet supporting BTC lightning payments. Nimiq’s app goes a step further, connecting to traditional payment channels to maximize connectivity between the crypto world and existing payment methods.
“The whole setup is packed with exciting technology from top to bottom. We’re exploring how existing devices in stores can accept and understand cryptocurrencies while still allowing merchants to receive euros for their convenience,”
Burger elaborated.
The initiative is also actively working to create a network of businesses ready to accept cryptocurrency. Over 20 shops in Mannheim have already joined in with the goal being to have 30 locations accepting crypto payments by the end of summer 2024. Lastly, Nimiq has also partnered with Bluecode, a European payment scheme offering more than 20,000 payment locations worldwide.
Addressing pertinent challenges
While the aforementioned vision is undoubtedly compelling, it still has some challenges to address. For instance, many crypto holders still view their digital assets as long-term investments rather than spending money. As a result, the question arises: Are people even willing to spend their Bitcoin for everyday transactions?
Burger believes this is a chicken and egg quandary, adding that if no stores accept crypto, no one will spend it. “We are trying to get out of this loop and stimulate both supply and demand simultaneously,” he added.
Similarly, on the subject of security and regulatory compliance, Burger acknowledged that while the cryptocurrency realm is still sometimes associated with money laundering, terrorism financing, and anonymous transactions, his firm is helping foster an ecosystem that is compliant both at the national and European level — dispelling the “wild west” narrative often associated with this space.
Beyond Mannheim
While Mannheim has and continues to be the testbed for this future-centric concept, Nimiq’s ambitions extend far beyond to cities like Berlin, which already boasts over 100 crypto acceptance points. The long-term vision is to create a network of crypto-friendly cities across Germany and Europe. In this regard, the Nimiq team aims to surpass Bitcoin in terms of physical acceptance locations by the end of next year and to double the number of Bitcoin acceptance points within the next three years.
Therefore, as crypto continues to gain mainstream attention and adoption, initiatives like the one being fostered in Mannheim stand to play a crucial role in bringing digital assets into everyday use. By creating a user-friendly, secure, and regulatory-compliant ecosystem for crypto payments, Mannheim is not just embracing the future of finance – it’s actively shaping it.
