Consumers will soon be able to make purchases with fiat-alternatives, from gold to bitcoin to other cryptocurrencies, right at retailer checkouts.
Fintechs leading the charge range from Glint, a startup aiming to allow users to hold and effectively spend gold, the London Block Exchange (LBX), a London-based startup headed by a Credit Suisse veteran launched last week, to Jack Dorsey’s Square Cash.
Customers can spend either Sterling or gold via Glint’s debit MasterCard, while LBX allows users in the UK to spend bitcoin and other cryptocurrencies through a Visa debit card. For its part, Square is testing a capability to let customers buy and sell bitcoin within its Cash payments app, reports CNBC.
Square’s small test is similar to the anticipated launch of an added functionality to UK challenger bank Revolut, a fintech that already enables users to hold, transfer, and exchange money in USD and 15 foreign currencies through its platform. Revolut’s functionality is expected to allow for the exchange of bitcoin as well as ethereum and litecoin in-app.
Alongside the belief that building products around new trends is the fastest way to understand said trends, Square CFO Sarah Friar told CNBC the current Square Cash tests are in response to customers requests for “an easy way to buy and sell bitcoin.”
“Ultimately, you have to be out there taking some risk and being able to go where innovation is going,” Friar said. “It feels like the early days of the internet…I don’t think we know yet what [cryptocurrency is] going to be, but I think, absolutely, as an innovator, Square has to be there to let a customer do what they want to do.”
Dependent on future consumer demand and adoption, even PayPal has considered offering cryptocurrency-compatible products.
If the surge of attention paid to bitcoin is any indication, that critical mass of consumer demand and adoption may not be so far away. The user base of Coinbase, the most established platform for buying, holding, and trading cryptocurrencies in the U.S., has more than doubled since the end of January, from 5.5 million to nearly 13 million today. According to its website, $40 billion in digital currencies have been transacted on the platform across 32 countries.
Glint, for its multi-currency account, app, and card allowing customers to store money in gold and effectively sell the required gold to cover the cost at purchase, has reportedly raised £6.1 million to date. And LBX, with its Visa debit “Dragoncard” allowing people to convert bitcoin, ethereum, ripple, litecoin, and monero to sterling and spend it across the UK, has raised £2 million from private investors, according to Business Insider.
It’s the potential spread of buying and selling cryptocurrencies within existing banking apps and enablement of fiat-alternative methods of payment at point-of-sale terminals that’s so intriguing. Using cryptocurrencies, these platforms could represent a more mainstream shift of transactions away from both government-controlled currencies and centralized banking.
Cadence is a fintech reporter and writer at Fintech Unltd, where she covers the changing landscape of financial technologies. Previously, Cadence interned at Psychology Today, Business Insider and the Wisconsin State Journal. Cadence is interested in how science and technology intersect with power and culture and is curious about the world we are creating for tomorrow, consciously or not. She graduated from the University of Wisconsin–Madison in 2017 with degrees in Journalism and Chinese. Send tips and story ideas to Cadence at [email protected] You can also follow her on Twitter @cadencebambenek.