Business & Finance

Starbucks not Accepting Bitcoins Just Yet, Plan to Come up with New Crypto Platform

'Baktt' could spell the beginning of cryptocurrency into the mainstream

Starbucks seemed to be getting ready to pave it’s way into the crypto world after it was announced earlier this week, from both Starbucks and the Intercontinental Exchange (ICE), that they had been working with Microsoft in order to establish a platform for digital currencies to be leveraged. The reports first surfaced in early May this year, of the New York Stock Exchange owner, ICE, being in process of building towards a Bitcoin trading platform. It has been further revealed that the creation of ‘Baktt’ will help trade and convert the best known cryptocurrencies to fiat money.

This involvement from Starbucks caused a huge stir in the crypto world and analysts had started gossiping about the probability of Starbucks employing cryptocurrencies at the cash counter. It was widely touted that we would now be able to take our teas, shakes and frappuccinos with bitcoins and other virtual currency. The hype was such, that CNBC ran a headline: “New Starbucks partnership with Microsoft allows customers to pay for Frappuccinos with bitcoin.”

However, the speculation was put to a swift halt as it is now understood that Starbucks will not be selling their products to be bought via digital assets and will not accept Bitcoin as a method of payment. The only involvement of any digital currency as a method of payment would be to trade the virtual currencies for U.S. dollars and pay with them. A Starbucks spokesperson reportedly clarified the matter and said:

It is important to clarify that we are not accepting digital assets at Starbucks. Rather the exchange will convert digital assets like Bitcoin into US dollars, which can be used at Starbucks,

Maria Smith, Vice President, partnerships and payments for Starbucks also commented on the matter:

As the flagship retailer, Starbucks will play a pivotal role in developing practical, trusted and regulated applications for consumers to convert their digital assets into US dollars for use at Starbucks. As a leader in Mobile Pay to our more than 15 million Starbucks Rewards members, Starbucks is committed to innovation for expanding payment options for customers.

Even though Starbucks has not employed for this project at a business level, it is still a part of an eye catching list of sponsors for the project ‘Baktt. The Intercontinental Exchange has announced for getting assistance from Microsoft and a partnership with Boston Consulting Group (BCG) to add to the one with Starbucks. Microsoft, for their part, will provide for all the technical requirements of the project, but the involvement of Starbucks comes as something uncanny, and it can still be speculated if this is a gentle step to ease into the crypto demographic. Nonetheless, their involvement certainly helps put the project into greater spotlight whose primary aim seems to be creation of a platform for transparent and regulated buying and selling of cryptocurrencies which would definitely help crypto move from the fringes of the society into the mainstream.

Jeffey C. Sprecher, Founder, CEO and Chairman of the Intercontinental Exchange (ICE) said:

In bringing regulated, connected infrastructure together with institutional and consumer applications for digital assets, we aim to build confidence in the asset class on a global scale, consistent with our track record of bringing transparency and trust to previously unregulated markets.

Maria Smith also added:

As a leader in Mobile Pay to our more than 15 million Starbucks Rewards members, Starbucks is committed to innovation for expanding payment options for our customers.

The statements put out by executives seem to suggest everything but the lack of intrigue from their end about the nascent crypto industry. Starbucks will not be new to identifying a new means of payment for their products, having already established their own payment app that has outpaced the likes of Google Pay, Apple and Samsung Pay apps. The projections made by eMarketer show that for 2018, the number of people using Starbucks’ payment app at least once every 6 months is 23.4 million, compared to Apple’s at 22 million, Google at 11.1 million and Samsung Pay at 9.9 million people. While the numbers are not too shabby for Apple and Google, this trend is still set to continue, according to Axios. An important factor in this valuation must also be that one third of these purchases in US and Canada from the Starbucks payment app are from loading gift cards.

Recapitulating, it is still big news for crypto followers and an exciting time for a big name like Starbucks to have started being associated with the industry. For a normal costumer, it is something huge to be able to spend the largely unaccepted crypto coins now, at a Starbucks store, everyday. Adding to the notion, Brian Kelly, CEO of BKCM, an investment firm focused on digital currencies, told CNBC:

Starbucks is seeing some kind of demand for acceptance of crypto and bitcoin, and to tie up with a huge regulated institution like the ICE is really positive for the space.

So it is probably well worth keeping hope, that the day our cryptos are worth a croissant with coffee in the morning, is just around the horizon with Starbucks. But for now, regular bucks, cards, coins and mobile payments, please.

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Razi Khan

Researcher, Electrical Engineer and a teacher, Razi is one who takes great intrigue in the prospects of blockchain and cryptocurrencies (BTC in particular) while contributing a critical approach over the subject regularly. Email: razi@blockpublisher.com or contact the editor at editor.news@blockpublisher.com

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