Evidently, companies like GHL, Softspace, SenangPay, BillPlz, AppPay, Mobiversa, Webcash, MOLPay, Paymatic, iPay88, MerchantTrade, ValYou, Tranglo, World Remittance and Transfer Friend now face a common threat. A threat that may not happen so soon, but eventually and definitely within the next 36 months.
These locally available fintech brands are either pure-play (or a hybrid) of mobile payment, payment gateway and remittance providers who are at real risk of becoming Bitcoin’s lunch, especially as cryptocurrencies are fast becoming a replacement for a way of transferring money over the Internet.
As it is today, Bitcoin, the cryptocurrency ‘gold’ just seems to be unstoppable and trailblazing revolution in conventional fintech world as we once knew it, not so long ago.
Now, there are over 10 million cryptocurrency users worldwide, and an estimated 150,000 in Malaysia. This number is rapidly raising, as Blockchain – the underlying technology behind Bitcoin (and all other cryptocurrencies like Litecoin, Dash) are increasingly being trusted by retailers and users alike as an exchange of financial value.
Fintech solution providers mainly focus their business on being able to provide at least one of the following three ‘value’ factors:-
- Being the trusted (identity verification) 3rd party for monetary transfers
- Acting as the ‘intermediary licensing agent’ with financial systems ie. banks
- Providing the software and services interfaces for transactions
Bitcoin is based on blockchain-technology, which touts a very powerful fundamental nature of being a distributed ledger (that really both extremely transparent and anonymous at the same time if you know what I mean) that cannot be tampered with.
This characteristic alone, solves the 1. and 2. once ‘intrinsic value’ that these companies purportedly offer, and what more, at almost at zero-cost.
Accepting and paying in Bitcoin, is all that requires for eTailers and consumers to continue trading by their own demand and supply, circumventing around having to pay transactional fees to utilize these fintech systems.
Conventionally, the revenues of remittance companies, payment gateway and mobile wallet providers come from charging percentage portion on top of the transaction value.
But when the time comes as it surely and steely will, Bitcoin will be widely accepted as a digital asset that will be used in replacement of fiat currencies for e-Commerce purchase, and even brick-and-mortar products and services.
As legitimate Bitcoin payments still forces buyers and users alike to be self-regulated and wear a ‘buyer/seller –beware’ hat, the risks that they face is nothing compared to the fintech brands and businesses that might just end up as Bitcoin’s lunch.
Makcik-stalls in the rural East Coast that are already accepting Bitcoin for their kuih and meals, following the example set by international car brands, property developers and hoteliers from around the world; it doesn’t take a genius to see that not embracing and integrating cryptocurrencies nails the coffin of (some) fintech businesses.