Despite headlines that the biggest coffee chain in the world will soon begin accepting Bitcoin, the crypto space is under pressure this morning (led by Bitcoin) following comments from Goldman Sachs that "further declines" are expected.
As TheAntiMedia.com's Carey Wedler writes, the biggest coffee chain in the world will soon begin accepting Bitcoin and cryptocurrencies. Starbucks has partnered with Microsoft, Intercontinental Exchange, the Boston Consulting Group, and others to form a new company that will a “enable consumers and institutions to buy, sell, store and spend cryptocurrencies on the global network by November,” CNBC reported Friday.
The company, called Bakkt, will operate by converting Bitcoin and other digital currencies to U.S. dollars to be spent at Starbucks. According to a statement in a press release, Maria Smith, Starbuck’s vice president of partnerships and payments, said:
“As the flagship retailer, Starbucks will play a pivotal role in developing practical, trusted and regulated applications for consumers to convert their digital assets into US dollars for use at Starbucks. As a leader in Mobile Pay to our more than 15 million Starbucks Rewards members, Starbucks is committed to innovation for expanding payment options for our customers.”
But the goal is not simply to make coffee easier to buy with Bitcoin. “Bakkt is designed to serve as a scalable on-ramp for institutional, merchant and consumer participation in digital assets by promoting greater efficiency, security and utility,” said Kelly Loeffler, Bakkt’s chief executive officer. “We are collaborating to build an open platform that helps unlock the transformative potential of digital assets across global markets and commerce.”
Further, Sean Collins, a senior partner at BCG, emphasized the growing power of the blockchain.
“Blockchain technology holds tremendous potential to enable new business models and trusted ecosystems,” he said. “By leveraging and developing fundamental market infrastructure, the Bakkt platform will enable firms across industries to accelerate a range of innovation.”
If and when Starbucks adopts cryptocurrencies as a form of payment, it will join other major retailers like Overstock, CheapAir, Expedia, and Shopify. The trend of proliferating cryptocurrencies does not appear to be slowing down. Earlier this year, eBay hired Adyen, a Dutch payment processing company that partners with BitPay, a firm that facilitates cryptocurrency transactions around the world, leaving the door open for the internet retail mainstay to accept cryptocurrencies in the future.
However, that was not enough to prompt buying in cryptos...
Which seems to have been triggered by headlines from Goldman Sachs 2018 Market Outlook that highlights “cryptocurrency mania” as one of several factors that could affect their initial market outlook for this year. Other factors listed included terrorism, the rise of populism, rising geopolitical tensions, and an increasing threat of cyberattacks.
"Our view that cryptocurrencies would not retain value in their current incarnation remains intact and, in fact, has been borne out much sooner than we expected," the team lead by chief investment officer Sharmin Mossavar-Rahamani said.
"We expect further declines in the future given our view that these cryptocurrencies do not fulfill any of the three traditional roles of a currency: they are neither a medium of exchange, nor a unit of measurement, nor a store of value."
While the adjusted outlook lists cryptocurrency instability as a possible risk factor, it also states that “we continue to believe that such declines will not negatively impact the performance of broader financial assets, because cryptocurrencies represent just 0.3 percent of world GDP as of mid-2018," adding that "in fact, we believe that they garner far more traditional media and social media attention than is warranted."
All of which seems to have weighed on Bitcoin, blasted back below $7,000 briefly this morning...