Starbucks Partners With Microsoft and ICE to Enable In-Store Bitcoin Payments
Starbucks (SBUX) is reportedly partnering with Microsoft (MSFT) and Intercontinental Exchange, the parent of the NYSE, to launch a new cryptocurrency exchange designed to bring digital assets to daily consumer use.
The new exchange company, named Bakkt, aims to create an integrated platform that “enables consumers and institutions to buy, sell, store and spend digital assets on a seamless global network.”
Introducing Bakkt https://t.co/FHBWMiBrdh
— Bakkt (@Bakkt) August 3, 2018
According to the official announcement, the new digital asset platform is designed to address a growing market now valued at $270 billion.
The Bakkt ecosystem is expected to include federally regulated markets and warehousing along with merchant and consumer applications. Its first use cases will be for trading and conversion of Bitcoin versus fiat currencies, as Bitcoin is today the most liquid digital currency.
Bakkt will kick-off with a 1-day physically delivered Bitcoin contract along with physical warehousing in November 2018. While the entire operation is still subject to CFTC review and approval, the exchange protocols will be specifically designed to manage security and settlement requirements of digital currencies.
Ultimately, Bakkt will serve as an on-ramp for everyone from institutional investors to merchants to securely and efficiently leverage cryptocurrencies. One immediate use case for the new platform will be in-store purchases, which will initially be explored by Starbucks.
In an accompanying statement, Maria Smith, Vice President of Partnerships and Payments for Starbucks, detailed the role that Starbucks will play in bringing cryptocurrency to everyday consumers.
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.
While there is no indication at this time how exactly Starbuck will integrate bitcoin into their payments system, it will likely come in the form of the company’s mobile app, which already leverages a point-reward based system.
In addition to Microsoft’s venture arm, other major investors in the new exchange include an affiliate of Fortress Investment Group, Eagle Seven, Galaxy Digital, Horizons Ventures, Alan Howard, Pantera Capital, Protocol Ventures, and Susquehanna International Group, LLP.
Bakkt notes that further operational details will be announced in the coming weeks.
Note: In responding to reports on Starbucks’ involvement with Bakkt, a spokeswoman for the company shared the following statement with Motherboard:
It is important to clarify that we are not accepting digital assets at Starbucks. Rather the exchange will convert digital assets like Bitcoin into US dollars, which can be used at Starbucks.
Disclaimer: This article’s author has cryptocurrency holdings that can be tracked here. This article is for informational purposes only and should not be taken as investment advice. Always conduct your own due diligence before making investments.