Stripe, API-based internet payment system provider with headquarters in San Francisco, has published a blog post about the future of bitcoin market.
The article, called “Bitcoin: The Stripe Perspective”, examines how the company can contribute to further development of bitcoin market and digital currency adoption. The blog analyzes the role of bitcoin in the world payments infrastructure. According to Stripe, users’ protection is the most serious unresolved problem for bitcoin.
Although there are certain barriers for the virtual currency adoption, the company noted that the cryptocurrency can be used today to solve main payments challenges.
In March, Stripe announced that it would start testing bitcoin support and in June, the firm’s CTO Greg Brockman said that bitcoin could unify different global financial systems.
Stripe has already raised more than $120 million from such venture capital companies, as Sequoia Capital, Khosla Ventures and Andreessen Horowitz.
The author of the blog, Brockman, indicated that it is the first time when bitcoin usage is low in countries with strong fiat currencies. Still, the technology may spread around the world by identifying new practical use cases for the digital currency.
He wrote: “Consumers mostly want a safe place to hold their savings, and the existing bank account insurances and consumer protections [in stable currency countries] have set a high bar.”
Stripe considers an increase is expected in countries with high inflation, including Iran, Venezuela and Argentina. People in such countries want to use more stable currencies.
Despite bitcoin price volatility, Argentine peso has even higher fluctuation. The post explains that such price instability can raise the value of bitcoin usage.
As post reads, bitcoin can help to solve border and capital control problems. Stripe sees the cryptocurrency as a way to change the world’s financial infrastructure.
The blog notes: “Traditional payment systems look a lot like computer networks before the Internet. Cryptocurrencies have given us a real opportunity to solve these problems.”
Stripe considers the best method to introduce bitcoin is through gateways, specializing in virtual money. Gateways would be operated by financial firms responsible for users’ protection and handling bitcoin issues.
It is similar to systems used by Ripple Labs, which intends to allow banks and other companies to connect to its payments and smart assets protocol. Stripe also noted that Ripple Labs and Open Transactions have failed to gain user support that would provide broader bitcoin adoption.
Comparing bitcoin to Visa, Stripe indicated that because of lack of proper user protection bitcoin can’t compete with such companies, as Visa.
“Unless we solve decentralized reputation, the bitcoin ecosystem will see the emergence of a few centralized consumer ‘trust providers’,” the blog reads.
Brockman ended the post with the following words: “We’re still in the very early days, but we can already start to see the shape of the potential impact of Bitcoin and other cryptocurrencies. If we get things right, life is going to be much better for billions of people.”