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Starbucks backing out of bitcoin adoption?

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The adoption of cryptocurrency payments could prove devastating for Starbucks and consumers due to tax-related issues as well as market volatility.

Cryptocurrency enthusiasts around the world were on the cloud nine when they heard that Starbucks which is the favorite coffee shop for most coffee lovers worldwide has backed the upcoming Bakkt exchange and might start accepting bitcoin payments at their outlets worldwide. However, the adoption of cryptocurrency payments could prove devastating for consumers due to tax-related issues.

 

Starbucks and Cryptocurrency:

Back in August 2018, Starbucks was in the news for being one of the backers of the upcoming Bakkt cryptocurrency exchange which is especially focused on bringing institutional investors into the cryptocurrency space. Recently, a few days back, it was revealed publically that Starbucks had acquired a good amount of equity in the upcoming Bakkt project and thus the coffee chain might just start accepting cryptocurrency payment in collaboration with the Bakkt Exchange. Such adoption could really mean a lot for the overall crypto community as Starbucks is one of the largest coffee chain and has over 28,218 stores worldwide as of 2018. This could result in other big food chains such as Mcdonalds or KFC also following Starbucks on the same. However, after a better examination, there are a number of factors which could make it difficult and very complex for Starbucks as well as the internal revenue services.

 

How does paying by crypto make a difference?

Make the payment for your coffee through bitcoin seems to be a simple concept as it just sounds like paying with a credit card or a digital wallet. However, taxes are the main concern here that make the most of the difference. According to the rules of the IRS or Internal Revenue Services, all the cryptocurrency payments (small or large) shall be directly reported to the IRS in order for them to calculate the profit or loss on the transaction and further calculate the tax on it. The laws related to cryptocurrencies are quite complex thus making it difficult for large companies to adopt cryptocurrency payments.

As Starbucks is a large company and deals with millions of clients every day, the number of transactions is huge. Even if a small portion of the total transactions is made in cryptocurrencies each day, it would still result in thousands of transactions to be reported to the IRS every day. This process would prove to be a headache for the company as well as for the users. Apart from this, the continuous change in the price of cryptocurrencies due to the volatility in the market is another reason why Starbucks might just back out of crypto adoption for the time being.

#Rumor

Ebay: No Plans of Accepting Bitcoin, Cryptocurrencies

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eBay has responded to the ongoing rumors that they are going to start accepting cryptocurrencies as a payment saying that they have no plans to do so.

eBay has responded to the ongoing rumors that the e-commerce and online auctions website is going to start accepting cryptocurrencies as a payment saying that they have no plans to do so.

 

eBay to accept cryptocurrency payments? Not Yet!

The rumors started to spread throughout the cryptocurrency industry after photos of the advertisements of eBay the Consensus event went viral. The advertisement read: “ Virtual Currency. It’s Happening on eBay.”


People were linking the current sudden bullish trend in the price of bitcoin to the e-commerce giant and online auctions site preparing to accept cryptocurrency payments.

 

The adoption of cryptocurrency by eBay which quotes itself as the world’s largest marketplace would have been a great move towards mainstream adoption and thus everyone around the cryptocurrency space was busy discussing the rumor. However, according to a recent report published by Bloomberg, eBay has denied the rumors saying that it has no plans to start accepting cryptocurrency payments.

 

An eBay spokesman said in the report that cryptocurrency (such as bitcoin) is not accepted as payment on the platform and it is neither the part of their payments strategy.

 

However, currently, eBay does have a section on the platform which reads Virtual Currency, however, on this section, the users can use fiat currency to buy cryptocurrency from sellers.

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#Bitcoin

Amazon Owned Whole Foods, Other Big Retailers Start Accepting Bitcoin

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Whole Foods, which is owned and operated by the e-commerce giant Amazon and other big retailers are now going to accept payments in bitcoin.

Whole Foods, which is owned and operated by the e-commerce giant Amazon and other big retailers are now going to accept payments in bitcoin.

 

Whole Foods and Others accepting Bitcoin using Spedn:

A company called Flexa in collaboration with Gemini exchange which is owned by the Winklevoss Twins has managed to persuade a lot of big retailers including Nordstrom, Crate and Barrel & Whole Foods to configure the same scanners that they are already using for payments from other digital wallets like Apple Pay to work with their cryptocurrency payments app called Spedn.

 


Everything is handled on the backend of the application so that the cashier need not even have heard of bitcoin, let alone understand how to manage payment in cryptocurrency. The merchant has the choice in receiving immediately converted fiat or actually taking and holding the cryptocurrency.

 

The Spedn app lets consumers pay in bitcoin, bitcoin cash, ethereum and GUSD (Gemini Dollar), the Gemini backed stablecoin.

 

This new solution actually uses the existing systems and offers really only upsides for the companies as they don’t have to do any special training for their staff and there is no new hardware required and just a software upgrade.

 

It is worth noting that this is still in its early experimental stages for all the retailers which are cooperating with this scheme and things may of course change in the future. The thing to keep in mind here is that Bakkt is likely launching a massive payment processing service for cryptocurrency in the very near future as well and it could be a big competitor to what Gemini and Flexa are offering.

 

The company will also need to prove itself with consumers and get people to actually go out, download and use the Spedn app.

 

Can this be a game changer in retailer adoption of bitcoin and cryptocurrencies? Let us know about your thoughts in the comments section below.

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#Technology

Microsoft Launching a Decentralized Identity Tool on Bitcoin

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Microsoft has announced that they are launching a decentralized identity tool on Bitcoin. The open sourced project will be called ION.

Microsoft has announced that they are launching a decentralized identity tool on Bitcoin. The open sourced project will be called ION.

 

Microsoft ION:

As announced by Microsoft on the 13th of May, The open sourced project called ION operates on how networks actually communicate with one another in the handling of decentralized identifiers.

 

This will give you the ability to prove that you own the keys to your identity data. For example, anytime that you go and use Facebook to login into another website, there is an underlying protocol which allows for that to happen. So, what Microsoft is building is a new protocol to enable this to happen in a decentralized way built on top of bitcoin.

 

The individual ION nodes on the secondary network shall be held responsible to keep the tracks of the DIDs or digital decentralized IDs and to timestamp these onto the bitcoin mainnet.

 

For creating a digital decentralized ID, the user will wrap a public key into the Digital Decentralized ID creation document on the ION network, sign the input using their private keys and then send it over to the node on the network. Each time that the user is going to update his Digital Decentralized ID by creating a sub ID or by updating the metadata, the corresponding node will update the changes in the Digital Decentralized ID document.

 

If Microsoft implements this into any of their software products then people will be using bitcoin to verify their identities. Currently, some companies have already moved forward to showcase their interest in running the ION nodes which includes the Bitcoin security and hardware company Casa, internet security firm Cloudflare and Equinix.

 

The project will move from the bitcoin testnet to the bitcoin mainnet later this year. What are your thoughts on the ION project by Microsoft? Tell us in the comments section below.

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