Bitcoin ‘is superior’ to existing payment networks, Strike CEO says

By April 19, 2022Bitcoin Business
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Jack Mallers, founder and CEO of payments application, Strike, believes Bitcoin can bring the first real change to the payments industry since the invention of the credit card.

Trading just above $41,000 as of Tuesday afternoon, down about 2% over the past month, Bitcoin is used primarily as a store of value asset that critics and long-time investors agree trades like risk-on equity, making it much less useful as a medium of exchange than cash.

But Mallers argues that Bitcoin’s underlying network makes it the world’s most efficient payments network if harnessed correctly. He contends that "using Bitcoin as a payments network is superior to card processing networks or bank networks or remittance networks like Western Union."

To reap the potential benefits, consumers and merchants don’t even need to touch Bitcoin, he argues.

“This is a payments network that can move value anywhere in the world at no cost in real time and anyone can build on top of it. It's more inclusive, more innovative. To the consumer who's remitting money or buying Chipotle, they don’t know Bitcoin is involved so whether you want to have a stablecoin, a Euro, Starbucks points, it's the payment network that facilitates the settlement of value that’s the disruptor here,” Mallers told Yahoo Finance.

A bitcoin ATM is seen at a stand during the Bitcoin Conference 2022 in Miami Beach, Florida, U.S. April 6, 2022. REUTERS/Marco Bello
A bitcoin ATM is seen at a stand during the Bitcoin Conference 2022 in Miami Beach, Florida, U.S. April 6, 2022. REUTERS/Marco Bello

During his April keynote speech at the Bitcoin 2022 conference, Mallers announced a series of partnerships between Strike and big-name companies including Shopify, Blackhawk and the world’s largest point-of-sale supplier, NCR. But the talk began with the history of the credit card industry.

“It’s a story as old as 1949,” he told his audience as he strutted back and forth on the stage in a black baseball cap and hoodie. That year, Frank McNamara forgot his wallet while dining out in New York — sparking his idea for the Diner’s Club card, which became the first multipurpose credit card.

Since then the industry “has seen a lot of consumer innovation… but no one has helped the merchant,” Mallers argued.

Accepting credit cards costs merchant businesses anywhere from 1.5% to 3.5% on each transaction total, according to . According to Mallers, those fees can be eliminated by using the Lightning Network, a 2nd-layer payments application built on top of Bitcoin, which he likened to the internet’s impact on communication.

A recent from digital asset firm, Arcane Research, found that use of the Bitcoin’s Lightning Network has grown more than 400% year-over-year with payment volume, averaging around $20 million per month for the first quarter of 2022.

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