An article in The Block yesterday includes the following statement: “Only U.S. customers will be able to pay in bitcoin initially.” They’re referring to Starbucks’ recent deal with Bakkt, the great hope of the crypto industry, which might manage to pull off the first crypto ETF. The deal gives Starbucks significant equity in Bakkt, but at no point does it actually require Starbucks to accept Bitcoin. And, for its part, Starbucks reportedly has no intention of doing so – at least not in the conventional manner.
STARBUCKS: WE’LL HELP YOU CONVERT CRYPTO TO CASH
The company told The Next Web that rather than accept crypto directly, it will create more ways for customers to convert bitcoin and other assets into fiat, which can then be used at their stores (emphasis added):
“Our role as the flagship retailer for Bakkt is to consult and develop applications for customers to convert their digital assets into US dollars, which can then be used in our stores. We anticipate that a range of cryptocurrencies will gain traction with customers and, through our work with Bakkt, we will be uniquely positioned to constantly consider and offer customers new and unique ways to pay seamlessly, at Starbucks. As we continue to move forward with this work, we anticipate we’ll have more to share in the coming months.”
So, some type of gift card situation is what’s brewing at Starbucks. Some kind of Bakkt-powered seamless payment platform seems possible. As regards the Seattle-based coffee giant, however, the notion of a Bitcoin QR code at checkout seems far-fetched.
HARDCORE BITCOINERS DON’T WANT COFFEE ON THE BLOCKCHAIN ANYWAY
These days, actual Bitcoin acceptance is more complicated than ever. Mainstream Bitcoin Core supporters eschew the idea of paying for things like coffee with Bitcoin – unless you’re talking about using the Lightning Network. Unfortunately, that puts an even greater technical demand on companies like Starbucks, who are already unlikely to integrate crypto payments.
Bitcoin Cash, on the other hand, wants exactly this type of transaction. But neither is currently in the running for replacement of gift cards or the Starbucks app. It seems the goal of the Bakkt partnership is to be a test case for expanding payment options.
International travelers might get the best of the deal – maybe some type of stablecoin settlement mechanism. Perhaps you will able to instantly convert your funds from back-home for daily use at international merchants, beginning with Starbucks.
As The Next Web’s Yessi Bellow Perez says:
“Starbucks allowing consumers to convert their cryptocurrency into fiat is certainly not the same as Starbucks accepting payments in digital currency […]”
Other blockchains could arguably handle it, but there’s an issue of user demand. Historically speaking, dozens of companies have integrated crypto payments only to find that a lack of demand makes it less than worthwhile. Major companies like Expedia have quietly discontinued Bitcoin payments, and we have to ask ourselves if we want Starbucks to be the next on the list of companies to do so.