On the Cusp of a Digital Payments Disruption
$IBM, $PYPL, $S, $V, $BTC, $USD
There is a huge, under-served world market for cryptocurrency, the World Bank (WB) statistics that indicate 2-B or more people worldwide are not banked, as well as by FDIC data that shows more than 23-M Americans are either unbanked or under-banked.
Such data illustrates how cryptocurrency is poised to potentially disrupt the digital payments landscape by ensuring an alternative to traditional banking; and all merchants are eager to avoid transaction fees regardless of where they do business in the world, which is a primary driver of ongoing growth in merchant acceptance.
The underlying potential and increasing acceptance of cryptocurrencies has sent many different kinds of demographics racing to find Bitcoin 2.0’s Killer Coin.
Any way we look at it, cryptocurrency is knocking on the door of the $3-T+ global digital payments market, demanding entry.
The real innovators on the coin and blockchain sides of the market stand to be the biggest winners, with user-friendliness and merchant adoption driving the acceptance.
The growing interest among merchants to adopt immediate settlement-capable cryptocurrency tech that is also universal, decentralized and fraud-resistant is big important news.
Notably, the addition of direct buying and selling of Bitcoins in Square’s (NYSE:S) popular Cash App has played a part in doubling the rate of downloads.
Needless to say, it is easily understandable why retailers across multiple industries would be pushing Square to accept bitcoins for transactions considering the benefits of using crypto instead of payment systems like credit cards.
Square, Inc. (NYSE:S) has seen its share price soar by some 60% since the merchant services aggregator’s announcement about allowing bitcoins to be purchased via the Cash App. And, notably, a recent Nomura (NYSE:NMR) survey reveals 60% of business owners using Square’s technology for rapid payment via smartphone would accept Bitcoin as a form of payment. A top analyst at Nomura’s independent equity trading arm, Instinet, put a $64 price target on Square in March, due in large part to the strength of the company’s crypto adoption.
PayPal Holdings, Inc. (NASDAQ:PYPL) in the news recently on comments from ousted CEO Bill Harris, who downplayed merchant adoption rates of Bitcoin, citing some of the aforementioned concerns, even going so far as to call Bitcoin a scam before getting sacked. PayPal co-founder Peter Thiel is pushing developments such as a patent application filing by the company for a system to speed up handling those long private keys used to transact BTC. The patent application details a means of creating secondary wallets with their own unique user keys for buyer and seller, practically eliminating the wait time payees currently experience when trying to ensure they will receive a given virtual currency payment.
Visa, Inc’s (NYSE:V) former CEO of UK and Ireland operations Marc O’Brien recently joined Estonian crypto startup Crypterium, which raised $52-M last year via an ICO. Crypterium is laser-focused on eliminating the difficulties associated with using crypto for everyday transactions and seeks to streamline the entire process, hoping to eventually partner with Visa to roll out crypto and/or virtual cards attached to proprietary wallets. This is an area that Visa already has considerable experience in, with offerings such as Virtual VISA credit cards. Mr. O’Brien highlighted the potential in a recent interview, noting how Crypterium and Visa could provide a haven for consumers in high-inflation markets such as Argentina or Turkey.
IBM (NYSE:IBM) Big Blue’s new head of blockchain development recently acknowledged cryptocurrency talks with about 20 central banks from various countries, including G-20 nations, is predicting that some will dare to toy with crypto, with the most potential shown by Sweden, North America and Asia. IBM’s crypto-friendly policies mark an evolution in its public crypto discussions. The company is now doubling-down on its use of Lumens (XLM), and it has significant first-mover advantage in the space with the capacity to be a real King-maker for innovative cryptos.