Katherine Ross

Tether announced Monday that it would integrate with Strike.&nbsp;



Strike is a mobile payments application built on the Bitcoin Lightning Network, which works similarly to PayPal or Cash App.



According to an <a href="https://tether.to/en/tether-usdt-to-be-integrated-onto-strike-leading-global-money-app/">announcement</a> from Tether, with “the stability and utility of Tether&#8217;s digital currency with Strike&#8217;s innovative payment solutions, users will experience a new era of secure and efficient transactions.”



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">Tether (USD₮) to be Integrated onto <a href="https://twitter.com/Strike?ref_src=twsrc%5Etfw">@Strike</a> ,Leading Global Money App<a href="https://t.co/PsWFHluo1y">https://t.co/PsWFHluo1y</a> <a href="https://t.co/XcFeclliP1">pic.twitter.com/XcFeclliP1</a>&mdash; Tether (@Tether_to) <a href="https://twitter.com/Tether_to/status/1660626168775684096?ref_src=twsrc%5Etfw">May 22, 2023</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Users will be able to buy and sell bitcoin through the app, as well as send and receive global funds, “overcoming liquidity challenges that have previously hindered adoption.”



“We believe this collaboration will foster the widespread adoption of digital currencies, driving innovation and creating a more inclusive financial ecosystem for all,” Tether CTO Paolo Ardoino said in a statement.&nbsp;



Last week, Strike <a href="https://www.businesswire.com/news/home/20230519005354/en/Strike-launches-global-money-app-to-3-billion-people-in-over-65-countries">announced</a> that it was expanding to 65 countries. It had previously only serviced three countries — the US, El Salvador and Argentina.



The total addressable market stands around three billion with the expansion.



In its first quarter assurance report, <a href="https://blockworks.co/news/former-cftc-chair-tether-commodity" target="_blank" rel="noreferrer noopener">Tether reported net profit</a> of $1.48 billion.&nbsp;



The stablecoin’s market cap sits near $82 billion, according to CoinMarketCap.&nbsp;



Tether is <a href="https://blockworks.co/news/tether-buying-bitcoin" target="_blank" rel="noreferrer noopener">also moving to diversify</a> its investments by allocating 15% of its net realized operating profits to bitcoin.&nbsp;



“Tether’s purchase of BTC is part of its conservative and prudent approach to investment decisions aimed at strengthening, increasing and diversifying its reserves,” the company stated.&nbsp;



In a House hearing earlier this month, a former CFTC Chair also said that the futures contract on Tether makes it a commodity.&nbsp;



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Digital Payments Provider Strike Integrates Tether 

Casey Wagner

Whether bitcoin can serve as an effective medium of exchange has been debated since the world’s first cryptocurrency launched, but a recent uptick in demand from non-US markets demonstrates the use case has picked up steam, market participants told Blockworks.



Blockchain-enabled payments are particularly useful in emerging markets, Jack Mallers, founder and CEO of digital payments platform Strike, said in a <a href="https://www.businesswire.com/news/home/20221206005453/en/Strike-Launches-Lightning-Fast-Money-Transfers-to-Africa" target="_blank" rel="noreferrer noopener">statement</a>. 



In a bid to match growing demand, Strike launched a new feature for US users to send bitcoin to Nigeria, Ghana and Kenya instantly and with minimal fees, the company said Tuesday.&nbsp;



“High fees, slow settlement, and lack of innovation in cross-border payments have negatively impacted the developing world,” Mallers said.&nbsp;



The Central African Republic — one of the world’s most impoverished countries — made bitcoin its legal tender in April of this year, about seven months after El Salvador became the first nation to do so. The move was intended to be a “quick win” for setting the country up for future success, <a href="https://blockworks.co/news/central-african-republic-looks-for-quick-wins-becomes-second-country-to-adopt-bitcoin" target="_blank" rel="noreferrer noopener">government officials said</a>. 



“The current financial system isn&#8217;t set up in a way that ensures equal access for people and institutions from Africa,” Bernard Parah, founder and CEO of African payments provider Bitnob, said.&nbsp;



<a href="https://blockworks.co/news/why-emerging-markets-are-leading-the-charge-on-cbdcs" target="_blank" rel="noreferrer noopener">Emerging markets</a> have also come out as top innovators when it comes to crypto payments in recent months. 



Countries such as Jamaica, the Bahamas and Nigeria are at the forefront and have launched central bank digital currencies, while Brazil and Haiti have expressed interest in exploring their own. The trend can be attributed to these economies having more pressing, fundamental needs than those of more developed markets, according to Steve Aschettino, a Norton Rose Fulbright partner focused on fintech.&nbsp;



“Emerging economies appear to view CBDCs as a way to jump start their economies,” Aschettino told Blockworks. “More-developed nations have existing and widely adopted electronic payment mechanisms already in place. While one may say this is an advantage, their existing payments technology can also serve as a barrier to the creation and broad adoption of a CBDC.”



Economies with higher unbanked populations and less robust financial services infrastructure benefit the most from blockchain-enabled payments, according to the Bank for International Settlements. 



“Providing a cash-like digital means of payment, in light of reduced cash usage and an increase in private digital payment services, is the most common consideration,” a May <a href="https://www.bis.org/publ/bppdf/bispap123_a_rh.pdf" target="_blank" rel="noreferrer noopener">report</a> from the BIS said. “Other significant considerations include strengthening competition among [payment] service providers (PSPs), increasing efficiency and reducing the costs of financial services.”



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Bitcoin’s Case for Payments Builds With New Strike Development

Michael Bodley

<div id="highlights-block_624f64707c1ac" class="highlights">
 <ul>
 <li>Strike CEO Jack Mallers detailed the new partnership Thursday at the Bitcoin 2022 conference in Miami</li>
 <li>Traditional payment processors haven’t innovated in more than 50 years, Mallers said</li>
 </ul>
 
</div>



In a move to revitalize the payments processing industry, which Strike CEO Jack Mallers said Thursday has been stagnant for 55 years, the company unveiled a partnership with Shopify to facilitate bitcoin-to-cash payments over the Lightning Network.&nbsp;



The setup is live now with Los Angeles-based streetwear designer Warren Lotas, with the plan being to add additional merchants in the coming months, Mallers said at the Bitcoin 2022 conference in Miami.



Railing against a “boomeristic” credit card system that started when “rich dudes” didn’t want to carry around wads of cash to buy caviar at high-end Manhattan restaurants, Mallers posited bitcoin as a solution to fees, transfer times and settlement issues that plague the traditional financial system.



Not content with targeting the online payments market, Strike — a digital payments platform based on the Lightning network — has also moved to enable in-person transactions via Lightning, connected by a user’s bitcoin wallet of choice. The company partnered with alternative payments processor Blackhawk and point-of-sale provider NCR to facilitate such transactions.&nbsp;



Dressed casually with his trademark hat, Mallers, through bits of laughter and profanity, presented himself as “just this kid from Chicago” in a stark contrast from the buttoned-up CEOs of traditional finance.&nbsp;



“In reality, payment networks have not innovated in over 50 years,” Mallers said. “That’s insane…that’s ridiculous.”



Mallers has also been working with political heavyweights, including the <a href="https://cms.blockworks.co/senators-warren-lummis-divided-on-digital-asset-value-agree-on-regulation/" target="_blank" rel="noreferrer noopener">bitcoiner Sen. Cynthia Lummis</a>, R-Wyo., to “get this done.”



The idea is to roll out in-person bitcoin payments at scores of retailers, including Chipotle, Whole Foods and Walmart.&nbsp;



There’s no word yet on whether the companies have opted in to the proposal — or any reaction from old-school payment processors that rely on fees for moving money. Strike’s transactions, which are instantly settled, cut down parties from five to two: the buyer and the seller.



“Anyone can build anything, man,” Mallers said. “Anyone can build anything.”



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Strike Rolls Out Shopify Partnership, Facilitates Online Bitcoin Transactions

<div id="highlights-block_6168a0e69c821" class="highlights">
 <ul>
 <li>BitMEX CEO says five more nations will adopt bitcoin by the end of 2022 </li>
 <li>El Salvador was quick to roll out bitcoin payments, but some question their practicality</li>
 </ul>
 
</div>



Since the announcement that El Salvador would establish bitcoin as legal tender in June, speculation has swirled around which other countries may follow suit.&nbsp;



Some believe El Salvador’s hasty rollout indicates that building an effective payment system may take time, others see Latin American nations accepting the world’s largest cryptocurrency by the end of next year.&nbsp;



“There&#8217;s a lot of noise, there&#8217;s a lot of attention around crypto, and there are several exchanges across the region, and particularly in Mexico, Colombia, Brazil, Argentina,” said Anabel Perez, CEO and co-founder of NovoPayment. “But I think we&#8217;re in the early stage of seeing the impact of crypto in Latin America economies.”&nbsp;



Two days after El Salvador President Nayib Bukele declared that bitcoin would become legal tender on June 5, the Bitcoin Law was passed. The Law included the controversial Article 7, under which businesses are required to accept bitcoin for all payments.&nbsp;



The timeline was sped up intentionally, said Jack Mallers, founder and CEO of Strike, who announced El Salvador’s news at the <a href="https://cms.blockworks.co/el-salvador-to-become-first-nation-with-bitcoin-as-legal-tender/" target="_blank" rel="noreferrer noopener">Bitcoin 2021 conference</a> in Miami after working with authorities to implement blockchain payments. 



During a <a href="https://www.whatbitcoindid.com/wbd362-jack-mallers" target="_blank" rel="noreferrer noopener">podcast interview</a>, Mallers shared that authorities said, “We can do this slowly, or we can just put it on the people and people will learn. If they’re forced to do it, they’ll learn and they’ll learn quickly.” 



Despite <a href="https://www.elsalvador.com/noticias/nacional/bitcoin-contradiccion-obligatorio-voluntario/876117/2021/" target="_blank" rel="noreferrer noopener">some hesitancy</a> from citizens and business owners, the law went into effect in September. Some believe we can expect to see other nations, particularly those in Latin America, join El Salvador in the coming months. 



“My prediction is that by the end of next year, we’ll have at least five countries that accept Bitcoin as legal tender,” BitMEX CEO Alexander Höptner wrote in a recent <a href="https://blog.bitmex.com/developing-countries-are-leading-the-way-in-bitcoin-adoption-heres-why/" target="_blank" rel="noreferrer noopener">blog post</a>. “All of them will be developing countries.” 



Höptner went on to cite remittances, rising inflation, and political motives to appear progressive and “new age” as reasons for developing nations to go all-in on bitcoin. 



<div class="wp-block-image"><figure class="aligncenter size-large is-resized"><img loading="lazy" decoding="async" src="https://blockworks-co.imgix.net/wp-content/uploads/2021/10/Screen-Shot-2021-10-14-at-4.26.15-PM-1024x690.png" alt="" class="wp-image-9421" width="840" height="566" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2021/10/Screen-Shot-2021-10-14-at-4.26.15-PM-1024x690.png?w=1024 1024w, https://blockworks-co.imgix.net/wp-content/uploads/2021/10/Screen-Shot-2021-10-14-at-4.26.15-PM-1024x690.png?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2021/10/Screen-Shot-2021-10-14-at-4.26.15-PM-1024x690.png?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2021/10/Screen-Shot-2021-10-14-at-4.26.15-PM-1024x690.png?w=381 381w, https://blockworks-co.imgix.net/wp-content/uploads/2021/10/Screen-Shot-2021-10-14-at-4.26.15-PM-1024x690.png?w=387 387w, https://blockworks-co.imgix.net/wp-content/uploads/2021/10/Screen-Shot-2021-10-14-at-4.26.15-PM-1024x690.png?w=325 325w, https://blockworks-co.imgix.net/wp-content/uploads/2021/10/Screen-Shot-2021-10-14-at-4.26.15-PM-1024x690.png?w=80 80w, https://blockworks-co.imgix.net/wp-content/uploads/2021/10/Screen-Shot-2021-10-14-at-4.26.15-PM-1024x690.png?w=1326 1326w" sizes="auto, (max-width: 840px) 100vw, 840px" /><figcaption>Source: Global Cryptocurrency Adoption Index | July ‘20 &#8211; June’21; Source: Chainalysis</figcaption></figure></div>



El Salvador is unique given that US dollars — which, like bitcoin, are also legal tender in the Central American nation — are not printed by its own central bank, Perez pointed out.&nbsp;



“There&#8217;s something that sometimes we don&#8217;t take into account, and that is the role of the central banks. There are certain markets in which the role of the central bank is not as critical as other markets because they don&#8217;t print currency. They just import money like in the case of El Salvador,” said Perez. “When the monetary authority doesn&#8217;t play a big role in the arbitrage, this type of model works when currencies can coexist, for example, the US dollar and crypto assets as a means for payments.”&nbsp;



There are ways that blockchain technology can benefit citizens in Latin America and across the world, Perez said, also pointing to remittances, but it’s going to take time. The main issue, she said, is the lack of infrastructure.&nbsp;



“We need more infrastructure in place to make the connection between digital assets and the real world,” she said.&nbsp;