When Bakkt was first announced, many crypto enthusiasts were excited about the prospects of purchasing coffee and other goods with digital assets. The partnership between Bakkt and Starbucks had everyone under the impression that they would be able to buy pastries and drinks from the Seattle-based coffee king with bitcoin.
Can’t Buy Coffee with Crypto
Unfortunately, it later came to be known that Starbucks wouldn’t allow cryptocurrencies to be used to purchase goods from its stores, and that it was simply sponsoring Bakkt as a motion of “good faith.” However, many crypto traders and investors are likely to get their wish after all following the birth of a new startup known as Flexa.
When bitcoin and other cryptocurrencies first arrived on the financial scene, the idea was that those who didn’t have valid doorways to cash or solid credit would be able to use crypto to purchase their everyday needs. The sad thing was that nobody expected cryptocurrencies to be as vulnerable as they are to outside market influence. This resulted in heavy volatility and unpredictable price swings.
Many retailers, as a result, began to distrust crypto, and said that they would not accept cryptocurrencies as valid forms of payment. The situation was easy to understand: somebody uses bitcoin to pay for $50 worth of merchandise. The next day, bitcoin would fall, causing that $50 to turn into $35. The person still walks away with their purchases, while the merchant lost $15 in profit.
It may not seem like much, but if several people are utilizing crypto to pay for goods, the accepting merchants stood to lose quite a bit in the end.
But Flexa has many retailers seeing the crypto situation through a different lens. Thus far, over a dozen merchants have joined forces with Flexa to permit the use of crypto for purchasing select items. Some of these retailers include Caribou Coffee, Barnes & Noble, Baskin Robbins, Jamba Juice and even Office Depot.
Today – Monday, May 13, 2019 – marks the first day that Flexa’s payment processing system becomes active. In addition, the company is looking to make things as easy as possible for retailers, initiating a one or two percent fee (which is cheaper than most credit cards) on most purchases. If a company wishes to accept crypto through Flexa, they will need one of the startup’s new digital wallets to process the transactions.
Push It to the Limit
Chief executive Tyler Spalding explains:
We allow any cryptocurrency to be spendable… This is the bridge. This is how it goes mainstream.
Also adding her commentary to the situation was Amy Zirkle, interim CEO of the Electronic Transactions Association Trade Group. She comments that crypto is a lot like the early days of digital photography, when “people still printed their pictures,” and said that she could “envision the same evolution” in digital currency.