Will Uber, HotelTonight welcome Bitcoin after adoption by PayPal’s Braintree?
While worldwide consumer usage of Bitcoin is still lagging, PayPal may be giving it the jumpstart that it needs. As Paypal continues to be an operator for a large percentage of the world’s online transactions, it is undoubtedly a service to Bitcoin for Paypal to bring the platform further out from the shadows.
“Given the number of marque clients on Braintree’s roster, which include the likes of Uber and HotelTonight, it will be interesting to see if any choose to integrate Bitcoin acceptance,” said Jordan McKee, senior analyst at Yankee Group, Boston. “Adoption by one of these merchants could have a significant impact on Bitcoin adoption moving forward.”
Mr. McKee is not affiliated with Bitcoin or PayPal but agreed to comment as an industry expert.
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According to 451 Research’s June 2014 consumer survey, 38 percent of consumers have never heard of Bitcoin. While the majority of participants are aware of Bitcoin’s existence, only two percent have used it at least once.
The adoption of Bitcoin has been sporadic up until this point. While Bitcoin has promised to offer fraud-proof solutions and combat today’s security threats, skepticism has persisted.
While PayPal is pervasively used and trusted across the world, its backing of the payments service may cause other service platforms to give it a try.
Since Braintree allows for in-app transactions for its software developer clients, they can easily integrate Bitcoin without the strain of redirection. This fact does not mean Braintree clients will automatically adopt Bitcoin payments, but they now have a very easy path to make it happen.
For brands such as Uber, HotelTonight and Airbnb, a positive user experience on mobile is crucial, and the startups continue to find the most innovative ways to appeal to their customers. Perhaps PayPal’s backing of Bitcoin can give these brands an impetus to give the software-based service a try.
1800Flowers.com’s plan to start accepting Bitcoin payments in the fall reflects the retailer’s search for new ways to reach a growing audience whose financial dealings and purchasing increasingly happen in the digital realm, including mobile.
The Carle Place, NY, company will begin accepting the virtual currency through the Coinbase platform already used by Expedia.com, Overstock.com, DISH Network and other brands across its sites, including 1-800-Flowers.com, 1-800-Baskets.com and FruitBouquets.com. The move underscores the marketing buzz the mention of bitcoin can generate even though it is an unofficial currency and considered experimental (see story).
Social gifting brand eGifter claims to be the first iOS application to offer bitcoins as a payment option.
Believing that the bitcoin system is a more secure platform, executives at eGifter hope to see more users adopt and continue to follow the currency. Offering egift cards from a multitude of sources, eGifter now accepts bitcoin payments to overcome previous struggles with security efficiency and fraud through mobile payments (see story).
“PayPal has stated its interest in Bitcoin before, so this announcement isn’t particularly unexpected,” Mr. McKee said. “Braintree serves as the ideal avenue for PayPal to whet its Bitcoin appetite and could very well be the thin edge of the wedge for PayPal’s broader plans to embrace the virtual currency.
“Braintree has become the defacto developer platform for PayPal, and more so, Braintree’s mobile-first clients are a particularly good for Bitcoin. This is just one of many reasons why Braintree was such an attractive acquisition target for PayPal.”
Caitlyn Bohannon is an editorial assistant on Mobile Commerce Daily, New York