Amazon is most likely among Big Tech to profit from its own native cryptocurrency, here’s why.
As WeChat showed, payments via QR codes can rule the world. Already there’s a race now to enable blockchain services on the cloud. Amazon and Microsoft have launched blockchain tools and partnerships this year. Facebook has announced a blockchain division, and it’s really not that mysterious at all.
With blockchain adoption accelerating in 2018 and many startups at the gates of creating a token blockchain economy with dozens and hundreds of innovative experiments, big tech won’t be left behind.
David Marcus, the head of Messenger for the past four years, is leaving that role to set up a group to explore how to use blockchain technology across Facebook.
Amazon has show an interest in the future of banking with a strategic partnership with JP Morgan Chase, with Amazon branded accounts.
Here’s why Amazon could launch its own cryptocurrency
Amazon is basically what amounts to a consumer success ecosystem: from grocery to entertainment, Cloud to Ecommerce, the Voice interface with AI care of Alexa. Amazon’s best customer are young educated customers, and Amazon Pay just won’t cut it for them.
There’s less pressure for Google or Microsoft to enter the cryptocurrency realm, blockchain in the cloud is enough. But Facebook and Amazon are in large part, consumer facing companies, their users matter.
A rivalry between Amazon and Facebook is brewing in the future of advertising. If Amazon is successful in setting up the largest consumer-centric value funnel in history with Prime, and there’s no reason to assume they will fail now, Facebook is doomed to be disrupted in advertising.
To combat significant churn among younger people, Facebook is pivoting to things like blockchain and dating. It’s not enough, Amazon’s customer-centric value is easily more innovative and casts a larger net.
Big Tech could Legitimize Crypto
A rivalry with cryptocurrencies however would accelerate the adoption of blockchain and start the token economy era. This is fairly likely to happen, the gains are too large to ignore any longer.
Amazon could issue its own cryptocurrency, before Facebook even has a chance to mobilize. Amazon prefers to be a first mover, as we have seen time and time again.
In the evolution of the Prime brand, crypto would fit in nicely. It would popularize Amazon’s onboarding of grocery customers and facilitate a mobile payments revolution. The use case with E-commerce and even how it does transactions with retailers and global payments to suppliers is very clear. Facebook would have a lot more trouble being successful with a FacebookCoin, it’s own native currency and competition with be more fierce.
Wall Street and Big Tech have been watching the cryptocurrency space intently, even banning crypto Ads on their platforms: Facebook was one of the first to do so, others followed suit. ICOs delegitimized, crypto censorship at its finest. But not blockchain, Cloud services started offering blockchain services en masse. Once regulation has occurred, big Tech can and will create their own cryptocurrencies, not to be outdone by startups and Chinese blockchain projects that will quickly achieve dominance in the years ahead.
It’s no longer a secret, In short, it’s become not just plausible but inevitable, that a major U.S. company is about to issue its very own cryptocurrency…that’s when all hell breaks loose, since at the rate Coinbase and others are going, it’s not just blockchain that will go mainstream, it’s all of crypto and cryptocurrencies. With all the bans, something is up.
Wall Street, Big Tech and the Government agencies in a sense are colluding to own the future. So who will be the front man of the cryptocurrency of the establishment? It’s more likely to be Amazon, than Facebook, that’s for sure. So how would we come to this conclusion?
While not recent news, remember this story:
Before the crypto singularity took place, Amazon conveniently bought three domains related to cryptocurrency. The internet domain name registry for Amazon were as follows:
Amazon registered the new website address: “www.amazonethereum.com".
And it registered another: “www.amazoncryptocurrency.com".
And another: “www.amazoncryptocurrencies.com".
This occured in November, 2017, just as Bitcoin’s bubble was expanding. Back then Amazon said:
Amazon Pay’s VP Patrick Gauthier told CNBC last month that Amazon had no plans to accept cryptocurrency because there hasn’t been much demand yet, and Amazon may simply be protecting its brand name.
There hasn’t been much demand yet? That’s the key statement here. Fast forward a few months, demand for such a product is growing. If Amazon doesn’t do it, someone else will, whether that’s Facebook, Telegram or some other altcoin that becomes a dominant means of transaction.
But if history tells us anything, and as central banks prepare to put fiat currencies on the blockchain, there may be a corporate race to revolutionize mobile payments with a cryptocurrency. Just as in the auto industry established players are partnering with ride-sharing and robocar partners; this is bound to occur as the future of payments and cryptocurrencies merge.
Mastercard and even Paypal are making patents for the blockchain, in the case of PayPal to speed up how fast crypto payments can occur. This is evidence there will be a crypto payments war, between blockchain startups, Big Tech and existing digital payment solutions. If everyone goes on the blockchain, it becomes a zero sum game.
The winner of that game will hold a monopoly status, (likely a duopoly). Amazon and Facebook could be those winners, where corporate cryptocurrencies could go the furthest, be the most global and push blockchain to even more innovative solutions.
AmazonCoin or a FacebookCoin, which would you like to see? Let’s not forget, this isn’t unheard of for Amazon. Back in 2013, Amazon started experimenting with issuing “coins” to be used on Amazon “Fire tablets, Fire TV, and on any Android device through the Amazon Appstore.” Remember that?
This was before cryptocurrencies became a thing, those Amazon coins are kind of like frequent flyer points. They have a clear value and can be redeemed for Amazon applications or other services; but they cannot be transferred, sold, or converted back into a fiat currency like the U.S. dollar. They are like a gimmick loyalty token. Amazon needs to upgrade them.
According to Business Insider, it won’t be that hard to implement. Amazon would either issue a finite number of Amazon-coins or employ a slightly inflationary monetary policy, something aligned with Amazon’s rate of growth over time. This might be something similar to Ethereum’s monetary policy.
I’m not sure I agree with this assessment completely, but Big Tech needs to opt-in to cryptocurrencies because young consumers prefer them, trust them and want to deal and play with decentralization and tokens; they like the game. If you monetize blockchain products on the Cloud, you can monetize cryptocurrency hype into your existing products and business model.
In the evolution of Prime, it’s not so crazy, is it?
It would likely do what is called an airdrop of Amazon-coins into Amazon Prime customers’ accounts. An airdrop simply means that it would distribute the crypto assets to its ecosystem of customers and partners to get the system started. (Business Insider)
Amazon’s Native Cryptocurrency Could Change the World
Having a major corporation implement its own native cryptocurrency means the way we all perceive the future of currency itself would shift. Such a form of value would also help onboard developers and software engineers so essential for the development of vibrant and dynamic ecosystems on the frontlines of innovation, AI and the Cloud.
- Amazon could give coins away to application developers to incentivize development on any of its technology platforms.
- Potentially use the coins for in-game purchases of virtual items. For example, how we give tips to our favorite Twitch (Amazon owned) streamers.
- AmazonCoin could be used for how Prime functions, giving us a monthly “allowance” of them which customers could use to do different things within the value ecosystem.
- Reward customers with more digital tokens if they purchase regularly from the Amazon online store; offer lightning deals for Prime Day and holiday deals with some purchases available via AmazonCoin.
- Reward usage of Alexa Skills with small amounts of AmazonCoin that could be used for purchases and other customer-centric interactions, such as same-day delivery or drone delivery.
The applications are endless, the AmazonCoin could help gamify how we relate to Amazon’s incredible customer value. Implementing a cryptocurrency would also increase Amazon’s value as a brand, as an edgy leader in innovation and the incredible trust consumers already have to the retailers and owner of Whole Foods, and the rise of grocery delivery that’s inevitable.
The advertising giants wouldn’t be able to pull it off well. Only Amazon would. And Amazon is the perfect company to do this. It has the ideal ecosystem of partners, retail customers, and business customers to leverage and it’s relentless pursuit of AI, the cloud and ultimately the stars (Blue Origin). An AmazonCoin would also enable the peer-to-peer sharing economy that could make Prime even more sticky.