Stripe will enable businesses to pay their consumers using cryptocurrencies, beginning with Twitter, in the latest indication of how large financial institutions are shifting to digital assets.
The $95 billion online payments business announced on Friday that it will begin allowing retailers to accept cryptocurrency payments using the USDC stablecoin, produced by cryptocurrency startup Circle. Stablecoins are tokens that are tied to fiat currencies in order to maintain a consistent price. In the instance of USDC, the cryptocurrency is backed by the US dollar, as the name implies.
Twitter as their first client
Twitter will be the first to use the new payment option. As on Friday, the social media network – which has recently been the subject of much speculation about a potential purchase by Tesla CEO Elon Musk – will allow a handful of artists to collect their earnings from its Places Paid And Super Follows feature in USDC.
Stripe’s first substantial foray into cryptocurrencies since discontinuing bitcoin support four years ago. In January 2018, the San Francisco-based business ceased accepting bitcoin payments, citing the digital currency’s reputation for erratic price fluctuations and inefficiencies in day-to-day operations.
However, amid the buzz surrounding “Web3,” a tech movement pushing for the construction of a decentralized version of the internet based on blockchain technology, the firm has subsequently moved to cryptocurrency. Stripe launched a dedicated team last year to investigate cryptocurrencies and Web3. Stripe co-founder John Collison stated in November that he may soon reintroduce crypto support.
“While the ‘store of value’ features of cryptocurrencies often attract the most attention, we feel the potential of open access global financial binaries’ is at least as exciting,”
Stripe wrote on his blog on Friday.
As a result, we investigated methods to leverage cryptocurrency-based platforms to get greater access.
The Polygon network will power the company’s crypto payments functionality, a so-called “layer 2” solution that sits on top of the Ethereum network to handle transactions quicker and at a cheaper cost. Bitcoin, ether, and other cryptocurrencies have been chastised for their lengthy transaction times and exorbitant fees.
“We want to extend support for new binary and payment currencies over time.”
Corporation including cryptocurrencies payments
Stripe isn’t the only firm allowing digital currencies on its platform; in fact, the company is arguably late to the party. Visa, MasterCard, PayPal, and other major payment processors have all stated their intentions to enter the market. It occurred at a period when the value of digital currency was still rising.
Several major cryptocurrencies have lately plummeted from record highs, with bitcoin, the world’s largest, falling more than 40% from a November peak of about $69,000. Bitcoin was selling at about $40,373.36 on Friday, down almost 4% in the previous 24 hours.