Coin Rivet: Could you talk us through the decision to accept cryptocurrencies? Was this driven by your customers or your own belief that this is the way forward, or a combination of both?
Sa Wang: It was more a combination. We followed several studies released this year by organisations like the Blockchain Business Council and Bloomberg. The demographics put the large majority of users between the ages of 18 and 34, tech-savvy, and excited to frequent businesses that support their interest in cryptocurrencies.
We think coins like ETH and IOST are a great way to engage with younger generations, and that the cryptocurrency ecosystem is a loyal and passionate market that isn’t being catered to. We are more than willing to fill that niche and believe it won’t be a niche for long.
SW: We believe that almost every new technology goes through a similar cycle of scepticism and suspicion before education about the technology begins to permeate through the public consciousness. Based on our research and the impressive companies pouring money into blockchain R&D, it seems extremely likely that cryptocurrencies are going to be a crucial technology in the coming years. The benefits of cryptocurrencies are well-documented and it’s unfortunate that critics tend to confuse Bitcoin with the blossoming field of blockchain technology.
It strikes us as extremely likely that blockchain will be a crucial technology for business payments in the near future. One example of a vertical that is already being transformed by blockchain technology is the remittances industry. More than $600 billion is transferred from workers across borders every year, and there is an entire ecosystem built around facilitating these transfers. These traditional centralised systems haven’t made any technological innovations in decades and can take several days to transfer money.
On top of that, they generally charge a healthy percentage for moving money around the world. To give a comparison, several weeks ago $99 million were transferred through a cryptocurrency in 2.5 minutes with fees of only .40 cents. This example serves to underline the incredible utility offered by cryptocurrencies. There are many examples of services traditionally provided by third parties, typically banks, which can now be done without needing a third party to facilitate. It’s absolutely revolutionary technology.
Coin Rivet: You’ve previously spoken of your surprise that more restaurants haven’t bought into cryptocurrencies. Why do you feel this is?
SW: Well for two reasons. The first, as I mentioned earlier, is that this is a rapidly growing consumer base that is passionate and looking for businesses that support their interests. Accepting cryptocurrencies is relatively easy to set up and harms no-one. The second reason is that blockchain technology represents the promise of lessened banking fees. For so long, businesses have had to partner with credit card companies and accept their charges.
Cryptocurrencies offer the ability to maintain the easy transactions that customers desire, without having to allow a third party to take a percentage from every transaction. If we can cut out a middleman, we will pay fewer fees, that’s just common sense. I think you’ll see a lot more businesses begin to accept cryptocurrencies as the tech becomes more accessible.
Coin Rivet: Why did you opt for Ethereum, OmiseGo, and IOSToken?
SW: We’ve done quite a bit of research into the crypto space and believe that utility tokens are going to be a critical technology in the coming years. Platforms like Ethereum, OmiseGo, and IOST enable innovation on a scale that hasn’t been seen since the beginning of the internet.
The Harvard Business Review recently wrote that blockchain technology has the potential to create new foundations for our economic and social systems. We see ETH, OMG, and IOST as leaders in this nascent industry, and want to support them by spreading awareness. One of the many benefits of adding support for cryptocurrency payments is the ability to educate customers about this new technology.
Coin Rivet: What percentage of payments do you see cryptocurrencies accounting for? Will it be a niche thing or compete with cash and cards?
SW: Initially, we expect it to be fairly niche, but if you look at the economic data from Southeast Asia, you will see a massive disparity in phone purchases between the East and the West. The gap is beginning to close, however, and we’ve already seen a drastic shift in NYC as many businesses have stopped accepting cash in recent years. A rise in cellular payments is the logical progression and as the West begins to catch up with the East in this metric, we expect crypto and apps to play a large role in securing those cellular payments.
Coin Rivet: What does the future hold for cryptocurrencies in the retail sector? Do you see major retailers rolling out cryptocurrencies?
SW: I don’t pretend to see the future but if I’m going to prognosticate, it makes perfect sense that cryptocurrencies will play a large role in almost every vertical. If a payment platform saves money and saves time, why wouldn’t we use it? I doubt you’ll ever see widespread adoption of a system where customers are paying .0035 ETH or 2357 IOST for items. People don’t have the time to do that math.
A more likely scenario is a system where those currencies form the underlying payment structure for each transaction but are displayed in real-time to their dollar equivalent so that both the customers and the retailers don’t have to pull out their calculators. Obviously, cryptocurrency is still a young technology, but everything was a young technology once. We expect to see rapid growth from these platforms and are excited to see how they change the fundamentals of business.
Disclaimer: The views and opinions expressed by the author should not be considered as financial advice. We do not give advice on financial products.