Apple’s recent announcement of Apple Pay is an interesting foray into the payments space for everyone’s favorite fruit company. At the heart of Apple Pay is the near field communication technology that links your credit card to a merchant payment, without exchanging your specific contact information. You can walk into the grocery store, get your food, and wave your magic wand of an iPhone to pay, all without removing your card from your wallet and more importantly exposing it’s number to the public.
While I do think Apple Pay is indeed innovative, I do have a couple of gripes. First off, payments are still being managed through the credit card companies and are thereby executed by the big banks. What I mean by this is that while Apple Pay may make payments slightly more convenient, it does not reduce the cost of goods.
In addition, you credit card information is centralized onto your phone, at one source. While this may bring added efficiency of getting rid of your wallet, it quite literally puts “all your eggs in one basket” if someone were to hack into your phone. Centralized repository of information = somewhere where hackers know to look.
The Future Lies In Bitcoin
Nevertheless, I believe there is something bigger amiss with this new Apple payments system, You see, Apple isn’t stupid – they are very aware of the merits of bitcoin and what it could mean for the internet and technology in general. At the same time, some of their biggest customers and vested interests are the big banks and their credit card cronies. The banks are not too keen on letting bitcoin evolve without a fight. Bitcoin is a threat to their very survival.
Seeing this, Apple decides to play both sides. Show the market it’s integrating into the payments space but pivot away from bitcoin…for now. After all, the banks are currently in a position of power and wield incredible influence. No use is making them angry.
This, however, gives Apple to ability to pivot quickly into bitcoin when the time comes. “First we innovated with Apple Pay with traditional payment methods, now we’re taking the next revolutionary step with Bitcoin” – I can see the corny commercial now.
As aforementioned, Apple knows the future of payments lies in digital currencies. The question now is when they nominate their winner – will be be bitcoin or a currency of their own? If it does end up being bitcoin, watch out because this will be the coming out party the crypto fanatics have been waiting for.