In July this year, the Amazon VP confirmed that the company had no plans to launch a crypto coin. However, it is an interesting idea if the company were to change its mind in the future.
It Would Change the Crypto Space Forever
Most of the rumors were started a while back when the company registered three domains related to the crypto space. If the company were to ever join the crypto space and start accepting crypto payments, it would herald the era of mass adoption in the crypto space. Besides that, it would be an efficient coin since the company has one of the largest developer teams in the world. Soon after, it is safe to assume other retailers such as Alibaba and Walmart would try to launch their own projects.
A Supply Chain Powered by the Blockchain
A large section of Amazon’s operations entails running an efficient supply chain. While Amazon accepting crypto would be great, one of the most important aspects of crypto is the blockchain. The company has a very complex and innovative supply chain and the distributed ledger could help to simplify things. Amazon currently deals with over 12 million unique products and blockchain technology could optimize the logistics of shipping products. You can be sure that while the company might not launch a crypto coin soon, it is definitely examining the possibility of using the blockchain. The company would be able to locate the origin and destination of each product in its supply chain with ease. It could help to cut cost and improve speeds.
How the Retail Market Would Be Impacted
If Amazon were to decide to launch a crypto coin, it would deploy a massive developer team to come up with a unique coin, which would be accepted by all of the company’s services. The company would need to be able to process more than 600 transactions a second and operate efficiently during peak sale hours. With this crypto, Amazon would not need to launch sites and fiat currencies that are unique to any region. Instead, everything would be priced in the crypto coin. This would ensure lower transaction fees and better security for users.
Amazon Thrives Off Competition
During our most recent interview with BloxLive TV, VF founder Jeff Guzzi mentioned how he believes all FAANG companies ( Facebook, Amazon, Apple, Netflix and Google) will be involved in cryptocurrency projects in the next 2-3 years. Despite Facebook going to battle with regulators on Libra, it’s evident they have interest in the crypto space. It’s hard to believe tech giants like Amazon are just sitting on the sidelines. They haven’t become the company they are today by ignoring future trends. Companies like Apple have already mentioned their interest in crypto, and we would expect this to evolve within other FAANG companies as well. There doesn’t seem to be data showing how much Amazon is spending on crypto related research, but we do know from a recent FinTech conference ( FiNext 2019 ) that Amazon is a leader in R&D spending – coming in at $16 billion in 2017.
Why Amazon Might Never Adopt any Mainstream Crypto
Currently, BTC is the largest crypto coin in existence. However, it is likely that Amazon will ever adopt the coin. These major coins are expensive and slow. Besides that, they are hard to integrate into retail platforms. The unstable price of BTC also means Amazon would never risk investing in the coin. In a single month, the company could lose billions I the price of BTC was to dip as it held onto some BTC.
However, efforts have been made to improve the speed of BTC, including the Lightning Network. There is also the problem of compliance. THE IRS and other government agencies have not made things easy for crypto holders. Amazon would have to navigate through a complex legal minefield and it might end up facing huge fines. While Amazon’s top leadership has made it clear they will not launch a crypto coin soon, this could change in the future.
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