Starbucks Looks to Blockchain TechnologyWith Luckin Coffee’s aggressive expansion plans and speedy delivery services, Starbucks is still searching for how it can get an edge on its competitors in China where its name recognition is simply not enough. This is part of the reason why the company has been looking at emerging technologies. In a Fox Business Interview with CEO Howard Schultz, he said that “I think blockchain technology is probably the rails in which an integrated app at Starbucks will be sitting on top of.” In 2018, the coffee giant declared itself as one of Bakkt’s key partners, alongside Microsoft and Boston Consulting Group. According to its press release, Starbucks is both looking to invest in Bitcoin futures trading and accept cryptocurrencies at its coffeehouses. A recent report from March elaborated that Bitcoin-related payments at stores would come once an equity deal is made between Bakkt and the company.
Are Starbucks Bitcoin Payments Even Possible?Starbucks is likely looking to Bitcoin (BTC) and other cryptocurrencies as a means of bypassing Visa’s and MasterCard’s interchange fees. However, Bitcoin’s current poor scalability and relatively high fees make it unsuitable for micro-transactions, so it’s still unclear how the company can implement BTC-based payments on-chain. The proposal will likely require crypto payments off-chain which will be settled on the blockchain later by a custodial service. This is precisely the initiative started by Flexacoin and Gemini recently, which listed the coffee company as one of its accepted stores. Do you believe blockchain technology will form some component of Starbuck’s expansion plans against Luckin Coffee? Let us know your thoughts in the comments below.
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