By Marc O’Brien, CEO at Crypterium, former CEO at Visa UK
It feels like now is the time when the big players are finally stepping into the crypto industry. Recently, the news about Starbucks’ cryptocurrency partnership with Microsoft and the Intercontinental Exchange (owner of the New York Stock Exchange) started to spring up in the headlines. The famous coffee house appeared to be developing an application that will enable instant conversion of digital currencies to US dollars and let customers to use their crypto holdings to pay for their everyday latte.
Almost at the same time, the largest operator of movie theaters in Thailand announced it is going to allow moviegoers to pay for its services, including movie tickets and popcorn, with crypto.
To keep heating things up, Brisbane Airport in Australia became the planet’s first aviation hub accepting cryptocurrencies.
A number of C-Suite executives have also jumped ship to the crypto. Former Commonwealth Bank chief financial officer Rob Jesudason has resigned in order to join Block.one, the firm behind EOS. UBS China’s former president, Karen Chen, has been appointed as CEO at Higgs Block Technology. I myself left the traditional payments industry after 25 years of running the giants, like Visa UK, to join the crypto industry.
The funny part, is that it wasn’t that long ago, calling cryptocurrencies “a mere bubble” was common for the majority of traditional companies. What’s changed?
Microsoft, Starbucks, and other global companies taking crypto seriously could help to solve today’s biggest problem with digital money — their adoption.
Just think about Starbucks’ customer base: its mobile payment system is so popular in the U.S., that it has a higher number of active users than Apple’s or Google’s. It serves millions of customers per day, so its involvement with cryptocurrencies has the potential to remarkably increase the number of people who actually spend crypto and don’t just view it as an investment opportunity.
Clearly, adding crypto as a way of payments brings lots of benefits for merchants as well. Since cryptocurrencies are decentralized, they don’t need a bank to verify transactions, allowing to eliminate some fees. The technology also gives the chance to avoid chargebacks and attract a wider customer base:
According to Statista, over 39 % of the respondents from the U.S. are willing to use Bitcoin for transactions and making purchases. Meanwhile, the number of Blockchain wallets has been growing since the creation of Bitcoin in 2009, reaching over 25 million addresses at the end of June 2018.
In some countries cryptocurrencies are also seen as an alternative solution to hyperinflation. In Venezuela, for example, the people are turning to Bitcoin as spiraling inflation at 8900% destroys the economy.
Breaching the gap
In order to make cryptocurrencies integral to daily purchases, you need to offer a fast, convenient, and reliable method to process transactions.
Due to global regulatory practice that still discourages the direct exchange of bitcoin for goods and services, some businesses are developing their own payment systems. Crypto space veterans, like Coinbase or Bitpay, are already offering services for processing payments in crypto. For instance, BitPay enters into the bitcoin transaction on the merchant’s behalf, and converts the bitcoin amount to a currency the merchant chose. In 2017 the platform’s bitcoin payments volume grew by 328%, almost reaching $1 bln turnover.
It’s not that major exchanges are staying aside, either. In march, South Korea’s Bithumb announced some 6,000 stores across the country will be able to sell their goods for cryptocurrency, through a joint venture with mobile payment operator and gift-card platform Korea Pay’s Service. The new venture is expected to be launched by the end of the year.
Meanwhile, some tech startups were quicker to introduce their alternative solutions. The startup I’m running now, Crypterium, is also working to solve the cryptocurrency adoption issues. We partner with major banks worldwide to let our customers issue virtual cards in Crypterium mobile app, bind them to their crypto accounts and pay at any of the world’s 40 million terminals with crypto. The importance of companies popularising the daily use of crypto can be illustrated by the example of our user base. Even before launching our product we had over 400K registered users. That’s impressive.
Summing up the above
Just as the Internet in 1995, blockchain is now having its own ‘Netscape moment’.The day you can use crypto to buy your morning latte is just around the corner. It’s argued that new blockchain solutions designed for enterprise-level implementation will prompt organisations to make their move. What blockchain lacks today are real-world active users. And, participation by large corporations could bring their existing user bases to blockchain and boost acceptance.
So buckle up. We’re heading to the times where cryptocurrencies are the new money. It’s going to be a fun ride, indeed.
Crypterium is building a mobile app that will turn cryptocurrencies into money that you can spend with the same ease as cash.
Shop around the world to pay with your coins and tokens at any NFC terminal, or via scanning the QR codes. Make purchases in online stores, pay your bills, or just send money across borders in seconds reliably and for a fraction of a penny.