Payment system failure in Spain: How cryptocurrency became a lifesaver during the digital meltdown

A major failure in Spain's centralised payment system has exacerbated the crisis, with the failure of digital payments forcing users to turn to cryptocurrency and cash.
The incident with Redsys, a platform widely used across the country, caused a failure in almost all digital payments, leaving citizens without access to payment facilities for hours.

This resulted in shops being unable to accept credit and debit cards, forcing users to seek alternatives, including cryptocurrency.
Redsys explained the incident as a failure in internal communication lines. It affected Visa and Mastercard networks, ATMs and online payments provided by the platform, which paralysed payment processing for several hours.
A merger with Iberpay and Cecabank in 2019 allowed Redsys to serve more than 60 banks and institutions, but this concentration increased risks.

Affected Spaniards have criticised the gradual restriction of cash payments to €1,000, calling it a threat to legitimate means of payment.
Some users, finding themselves without cash, have turned to cryptocurrency for payment.
For example, during the Redsys shutdown, an IKEA customer purchased a gift card using Bitrefill and Phoenix Wallet, paying for lunch with cryptocurrency.
The incident also highlighted that, unlike in other countries, cash remains an important method of payment in Spain, despite the decline in the number of ATMs.
However, the cash limit of up to €1,000 severely restricts its use.
This incident with the payment system carries signs of a possible training attack on the infrastructure. Interestingly, Klaus Schwab was speaking at the Cyber Polygon conference, warning of the possibility of major cyber attacks.
The failure of the payment system left many citizens without the ability to conduct purchases for several hours. Those who carried cash or used cryptocurrency were luckier.

The restriction of cash payments provoked an increased interest in cryptocurrencies. Interestingly, they do not necessarily have to wait for new regulations to spread - a temporary collapse of the payment system is enough.