- Bakkt announced in October 2019 that it had been working on a cryptocurrency app.
- The cryptocurrency app was projected to be launched within the first half of 2020.
- The Bakkt app is expected to serve as a cryptocurrency debit card that can be used if the merchant has integrated Bakkt into their business.
Bakkt announced in October 2019 that it had been working on a cryptocurrency app oriented towards the consumer that allows for digital asset-based transactions at retail merchants.
The app was projected to be launched within the first half of 2020, and as we move closer and closer to the expected launch of the app, current market conditions and challenges being faced by the cryptocurrency ecosystem.
It can possibly be solved by Bakkt and thusly revolutionize the cryptocurrency space by taking it mainstream to retail payments worldwide. The app is expected to be supported and backed by major retail merchants such as Starbucks, which can seriously catapult crypto adoption into the mainstream market.
The app promises to offer an instant exchange of digital assets for services and products; something that has been a serious challenge for the major cryptocurrencies like Bitcoin.
One of Bakkt’s game-changing promises is that of instant transactions in the retail space. Cryptocurrencies like Bitcoin take about 10 minutes to several hours to sometimes confirm transactions making them essentially ineffective for smaller volume payments in the retail space.
They also come with a larger transaction fee, which makes them pale in comparison with more efficient payment services like credit cards and debit cards. The Lightning Network is Bitcoin’s proposal to solving this issue, but it has its own drawbacks too regarding the channel system and how Bitcoin needs to be locked into channels for usage, and new channels need to be opened when the locked up Bitcoin is exhausted.
This still pulls Bitcoin further behind easier-to-use payment services that already exist. Enter Bakkt, and with a way of instant exchange of digital assets to the merchant for services, they can seriously undercut the whole purpose of the Lightning Network protocol.
From some hints gathered from the Bakkt CEO, there is speculation that the Bakkt app will be able to send/receive transactions to merchants quickly, with similarity to PayPal’s interface. In addition to a section of the app for merchants, equity trading, and support for a plethora of digital assets.
The Bakkt app is expected to serve as a cryptocurrency debit card that can be used if the merchant has integrated Bakkt into their business. The transaction fees are also expected to be much lower than using credit cards, undercutting them so much that merchants might be able to lower product/service prices.
Another speculation is that the app will instantly trade the crypto for fiat and then transfer the fiat to the merchant. This will prevent the merchant from having to take any extra measures to convert the crypto to fiat since they would be receiving fiat in the first place.
Bakkt also acquired loyalty services provider Bridge2 Solutions last year, which is a large player in the reward points space. Bridge2 has built rewards programs for a majority of the top financial organizations and has over 4,500 loyalty, incentive, and perk programs across different corporate clients.
They already have existing Loyalty Pay services that allow for the accumulation of universally accepted points. Integration with Bakkt would mean that users will also be able to exchange reward points for cryptocurrencies. The company also hopes to support in-game payments for video games along with other digital credits on stores, rewards, stocks, and fiat.
The combination of their market entry due to a void left by other popular services backed by their strong reputation in the industry. Bakkt has incredible potential to change the cryptocurrency world as we know it and bring it forth into the global audience while establishing itself as the leader in digital asset exchange.