[2019-02-02]Amazon Might Have to Issue a Cryptocurrency Soon

[ppblockchain]

Recently, the founder and CEO of Binance Changpeng Zhao in his twitter account said that sooner or later, Amazon will have to issue its own cryptocurrency. What caused such assumptions and will Zhao announcement become reality?
How it all started?

At first the Binance founder stated in his Twitter that he does not understand why any e-commerce business does not accept cryptocurrency. Later on, in the same post, Zhao listed some of the main features and benefits that a cryptocurrency can offer compared to traditional payment methods.




Read more : https://paperblockchain.com/amazon-might-have-to-issue-a-cryptocurrency-soon/

[o_e_l_e_o]

Because of demand. I struggle to believe that Zhao doesn't realize this - I suspect he is just being deliberately facetious.

Take Amazon as an example. Amazon is ubiquitous. It already has an enormous market share all over the world. How much do you think their profits would increase if they started accepting crypto. Sure, some people, maybe even quite a lot of people, would move from paying in fiat to paying in crypto, but how many new customers who have never used Amazon before would start using Amazon solely because they started accepting crypto. Not many.

Now think about how much effort it would take for Amazon to integrate crypto payments - everything front the front-end development right through to the new regulations and tax paperwork, some of which barely exists in many countries. It would be a huge undertaking for very little monetary gain, and after all, these private companies are first and foremost interested in profit.

[pixie85]

Because of demand. I struggle to believe that Zhao doesn't realize this - I suspect he is just being deliberately facetious.

Take Amazon as an example. Amazon is ubiquitous. It already has an enormous market share all over the world. How much do you think their profits would increase if they started accepting crypto. Sure, some people, maybe even quite a lot of people, would move from paying in fiat to paying in crypto, but how many new customers who have never used Amazon before would start using Amazon solely because they started accepting crypto. Not many.

Now think about how much effort it would take for Amazon to integrate crypto payments - everything front the front-end development right through to the new regulations and tax paperwork, some of which barely exists in many countries. It would be a huge undertaking for very little monetary gain, and after all, these private companies are first and foremost interested in profit.

But we can't deny the positive aspects. Crypto payments would allow people from poor countries who are afraid of using their local currencies to order stuff from Amazon. The problem is they aren't that global yet and there are many shipping restrictions. I found out multiple times that I either had to pay more for something to be shipped to my country or that it's unavailable for shipment for whatever reason. Usually because they aren't shipping big items worldwide.

[gentlemand]

But we can't deny the positive aspects. Crypto payments would allow people from poor countries who are afraid of using their local currencies to order stuff from Amazon. The problem is they aren't that global yet and there are many shipping restrictions. I found out multiple times that I either had to pay more for something to be shipped to my country or that it's unavailable for shipment for whatever reason. Usually because they aren't shipping big items worldwide.

I've seen Amazon described primarily as a logistics company. Accepting payments is the easy part. Getting the product to the customer is often not and I doubt Amazon would risk wrecking that to serve territories who may not offer them much in the way of profit.

Accepting crypto makes no sense for them. Existing crypto users can use gift cards, but they're more interested in hoarding. The 99+% of their customers who don't have it have no reason to pay with it either.

[fudster]

If its binance that is going to help do the ICO for Amazon, this won't end well . BTT is the most recent proof that its going to be another pump and dump. But then again, this is going to be a huge promotion for cryptocurrency. If amazon is going to be really doing it, the best course of action is to find ways to have good amount of funds ready to buy after the price dip.

[Nameless27]

A collaboration and possible cooperation with this two company would make a big impact in cryptocurrency this year. Isn’t it late for over a year or so, before this implementation must have been done. The top exchange will support and help the highest and most popular online markets like amazon.

With proper negotiations on going (IF) is highly on time for the next run of crypto popularity that has been paused last year.

Amazon coin would be a big hit.

[LeGaulois]

Zhao said this because Wordlfirst closed its business and many sellers were using it, but Amazon won't jump in the crypto world just to make the sellers happy. Some others will take the slots, no problem because yeah the company is so big (and the demand is so small). On the top, Amazon seems to prefer focusing on blockchains platform with AWS rather than the crypto industry.

[o_e_l_e_o]

But we can't deny the positive aspects.

Oh, there are plenty of positive aspects for sure. Amazon are probably losing hundreds of millions of dollars each year to credit card fees, which is by far the most common purchasing method. Even a fee of 1% would work out as over a billion dollars given their revenue of ~$180 billion. This could all be extra profit for them if they started accepting bitcoin. It's not like they don't know about bitcoin, so we can only assume the cost-benefit analysis is not favourable for them at the present time.

On a side note, Jeff Bezos reckons there will be 1 trillion people living in solar system at some point (https://www.cnbc.com/2018/10/15/blue-origins-jeff-bezos-predicts-1-trillion-humans-in-the-solar-system-wired-summit.html). That's an awful lot of people to split not many bitcoins.

[squatter]

But we can't deny the positive aspects.

Oh, there are plenty of positive aspects for sure. Amazon are probably losing hundreds of millions of dollars each year to credit card fees, which is by far the most common purchasing method. Even a fee of 1% would work out as over a billion dollars given their revenue of ~$180 billion. This could all be extra profit for them if they started accepting bitcoin.

It's not that simple. They'd need to worry about converting those coins into fiat. A processor like Bitpay charges 1%, so it's looking less lucrative already. If consumers demand it, I'm sure it'll eventually happen, but I see no real signs of demand from consumers.

[o_e_l_e_o]

It's not that simple. They'd need to worry about converting those coins into fiat. A processor like Bitpay charges 1%, so it's looking less lucrative already.

I'd be surprised if a company the size of Amazon didn't just set up their own process or mechanism to convert as much as they wanted to to fiat rather than relying on a 3rd party.

If consumers demand it, I'm sure it'll eventually happen, but I see no real signs of demand from consumers.

Exactly. Unless there was serious competition in the form of a crypto marketplace or similar hurting their bottom line, then they have no real reason to go to the effort. Their revenue is ~$180 billion in fiat. An extra million or two in crypto just isn't worth it.

[squatter]

It's not that simple. They'd need to worry about converting those coins into fiat. A processor like Bitpay charges 1%, so it's looking less lucrative already.

I'd be surprised if a company the size of Amazon didn't just set up their own process or mechanism to convert as much as they wanted to to fiat rather than relying on a 3rd party.

At a certain point, that's true, but only if they expect immense new revenue. They'd need to develop a robust wallet and custody solution. That takes a lot of staff time and development money, ongoing maintenance costs, and also introduces custody risks. Saving 1% in processing costs has to be measured against what they'll lose in a potential compromise, and that's on top of development and maintenance costs.

There's plenty of incentive for a company like Coinbase to pour money into this stuff because they're raking in huge % commissions. The potential upside is much bigger. I really wonder what it would take to create that sort of incentive for Amazon. My feeling is that we're decades away, if ever.

[davis196]

This is wishful thinking.Amazon won't care about cryptocurrencies untill the global crypto market reaches atleast 1 trillion USD(or probably  more).This market cap has to be reached only due to the massive crypto adoption and without any bubbles,market manipulation  and hype(highly unlikely to happen).

[Kakmakr]

I think chargebacks alone should be a big bonus for many people and the increased security should also benefit a lot of people. eCommerce payment systems like credit cards and PayPal are not even close to be the ideal solution for these kinds of applications, because it is by nature ineffective by being centralized technologies.

Why we are still using these ancient technologies are beyond me, Bitcoin is much better and also widely accepted. 

[squatter]

I think chargebacks alone should be a big bonus for many people and the increased security should also benefit a lot of people. eCommerce payment systems like credit cards and PayPal are not even close to be the ideal solution for these kinds of applications, because it is by nature ineffective by being centralized technologies.

Why we are still using these ancient technologies are beyond me, Bitcoin is much better and also widely accepted. 

That's just the thing. Bitcoin isn't widely accepted. This is still the early adopter phase.

Amazon would love to accept BTC if customers really wanted it -- it's a merchant's dream. I assume they don't bother because there isn't actually strong demand for it, and if there were, there may not be enough market liquidity to liquidate their coins without losses. It's just an unnecessary risk for them.

[1Referee]

I assume they don't bother because there isn't actually strong demand for it, and if there were, there may not be enough market liquidity to liquidate their coins without losses. It's just an unnecessary risk for them.

I'm pretty certain that Bitcoin's lack of short term scalability is more of a problem than that. It's just not interesting for them to accept it now, and I can't blame them for that. Amazon has such a massive reach world wide, that even a slight uptick in demand is enough to have the network become congested.

It all comes down to Lightning. It's just a matter of time before we see them hop on board after successfully having done some prior testing.

[LeGaulois]

I'm pretty certain that Bitcoin's lack of short term scalability is more of a problem than that. It's just not interesting for them to accept it now, and I can't blame them for that. Amazon has such a massive reach world wide, that even a slight uptick in demand is enough to have the network become congested.

It all comes down to Lightning. It's just a matter of time before we see them hop on board after successfully having done some prior testing.

Amazon has always considered Paypal as a competitor and so has Paypal. Between them, it's a dog and cat story. And it's certainly the same between Amazon and Bitcoin. In addition, Amazon has no real interest in adding Bitcoin as a payment method. If this will help to increase the market maybe but it is not at all the case. Why should Amazon add BTC, knowing the demand in near zero

[figmentofmyass]

I'm pretty certain that Bitcoin's lack of short term scalability is more of a problem than that. It's just not interesting for them to accept it now, and I can't blame them for that. Amazon has such a massive reach world wide, that even a slight uptick in demand is enough to have the network become congested.

It all comes down to Lightning. It's just a matter of time before we see them hop on board after successfully having done some prior testing.

i could see them not wanting to ruin the customer experience if people are waiting many hours or days for a payment to confirm or be dropped from the network.

but i still don't see how that equates to demand from people to pay with LN. bitcoin is already a tiny niche for consumers; lightning is an even tinier blip on the radar. i can't imagine amazon is even remotely interested until bitcoin gets much, much bigger. implementing lightning would just generate losses when no one uses it.

[hatshepsut93]

Because of demand. I struggle to believe that Zhao doesn't realize this - I suspect he is just being deliberately facetious.

He probably does realize it, but he would benefit greatly if companies started adopting crypto, because they would probably just use exchanges as payment processors.

Also, this article as a whole is pretty worthless, it's just a biased opinion of one man, it's not a business analysis or something. O hope this trend of releasing platform-based coins will die soon, because in real world no one wants to manage dozens of accounts.

[stompix]

But we can't deny the positive aspects. Crypto payments would allow people from poor countries who are afraid of using their local currencies to order stuff from Amazon. The problem is they aren't that global yet and there are many shipping restrictions. I found out multiple times that I either had to pay more for something to be shipped to my country or that it's unavailable for shipment for whatever reason. Usually because they aren't shipping big items worldwide.

I've seen Amazon described primarily as a logistics company. Accepting payments is the easy part. Getting the product to the customer is often not and I doubt Amazon would risk wrecking that to serve territories who may not offer them much in the way of profit.

Exactly, Amazon accepting some kind of currency won't help people in faraway forgotten countries to shop there.
You have problems even if your located in Poland and the Czech Republic with some vendors, but when it comes to Romania or Bulgaria good luck buying something, and Bulgaria has its currency pegged to the euro for more than a decade.

Besides, the cost is indeed prohibitive for heavy items outside the main routes as I checked a few months ago how much it will cost me to buy a UPS for my parents and with an extra 65 euros....not going to happen.

Because of demand. I struggle to believe that Zhao doesn't realize this - I suspect he is just being deliberately facetious.

He probably does realize it, but he would benefit greatly if companies started adopting crypto, because they would probably just use exchanges as payment processors.

If Amazon will launch a coin it will probably be a stable coin pegged to the USD so I doubt it will be heavily traded on exchanges, and if it will be listed it will ruin a lot of the current stable coins, plus it will destroy the dreams of many tokens that were focused on being accepted as payments on a large scale.

Probably it will have the effect FB had, trashing almost every other social network that had no particular niche.

And I somehow doubt Amazon will launch a partnership with a company that fleed Hong Kong and then Japan to settle down in one of the last a bit legal offshore's still open for business in the EU. They have enough problems to associate themselves with Binance or Bitfinex or Btpay.

[1Referee]

but i still don't see how that equates to demand from people to pay with LN. bitcoin is already a tiny niche for consumers; lightning is an even tinier blip on the radar. i can't imagine amazon is even remotely interested until bitcoin gets much, much bigger. implementing lightning would just generate losses when no one uses it.

It's marketing. People here seem to be so tied to their this or that doesn't work way of thinking.

Bitcoin as an additional payment option doesn't cost anything if it isn't being used, but will very likely result in a wave of customers they otherwise wouldn't have. BitPay alone did +$1 billion in conversions last year, where it's safe to say that the far majority of this is related to Bitcoin.

Give people the merchants they frequently shop at, and this $1 billion will become +$2 billion, and more as time goes by.