Its been three years since I first met Sonny Singh, BitPay’s Chief Commercial Officer and five years since I interviewed the company’s co-founder, Tony Gallippi, a familiar face in the “old school” crypto community. BitPay is one of the biggest and most recognized global bitcoin payment service providers in the world and has been making headlines in the crypto space and far beyond since its inception in 2011.
BitPay’s mission statement has always been to solve payment pain points for their merchants and customers, a statement that was echoed in both of my past interviews with Gallippi and Singh and reinforced again in this week’s interview with Singh for Becky’s Affiliated.
Despite what you might be seeing in the mainstream media headlines, crypto currency spending is alive and prospering, regardless of a dip in value of currencies such as Bitcoin Cash (BCH) and SegWit-Coin BTC (commonly referred as “Bitcoin” or “BTC” in the media). When assessing the health of the crypto marketplace, rather than focusing on the value of crypto currencies at any particular moment as many of us are doing, I suggest focusing on merchant uptake around the world and other use cases for using those currencies and technology.
Take a look at BitPay for example, a company enabling any merchant to easily accept BCH and BTC without taking on any of the risk, a company that has been growing every year since its inception and just closed its $40 Million extended Series B funding round. Recent investors include Menlo Ventures, a Silicon Valley VC firm that was instrumental in bringing Uber to the next level, Nimble Ventures (an affiliate of Passport Capital, a well-known American hedge fund), Asia-based investor Capital Nine, Asia-based angel investors amongst a number of others.
Singh revealed to CalvinAyre.com BitPay’s plans to open an office in Asia, likely Singapore, and said, “these types of investors and names really gives us credibility as we try to establish banking partnerships, customers and an office location in Asia”. This does not sound like a dying market to me.
Its no secret BitPay has had their eye on the Asian market for quite some time now, having announced a partnership with South Korea-based Bithumb, one of the world’s largest crypto exchanges, to deliver an international blockchain option for B2B payments between South Korean and American/European businesses.
For huge transactions of this nature- we’re talking millions of dollars per invoice- businesses are keen to swap the usual 4% FX fee along with a four-day bank wire to BitPay’s 1% fee for a one-day crypto-based transaction. High mining fees for use of the BTC network for a transaction of this nature would not matter so much, but they would matter for day-to-day merchant payments or smaller transactions in general, an area of payment processing BitPay is also heavily involved in.
When asked how the BitPay merchants and customers have been reacting to the high miner fees on the BTC network and how these fees affect the BitPay business, Singh had an informed and reasonable answer.
“Our goal at BitPay is to make a seamless, easy payment experience for our merchants, where our merchants should not even know what’s happening with the Bitcoin network and things like that”, he said.
“In Q4 a lot of the (BTC) miner fees got a little too high, like 5/10 dollar miner fees, so when someone’s trying to purchase a good for 15 dollars off of say, Microsoft’s website and the miner fee is 10 dollars, it doesn’t really make the transaction economically viable. So at some time last quarter we actually announced we could only do transactions over five dollars to make it feasible”.
“And that’s really what helped us make the decision to add on support for Bitcoin Cash…now the consumers have the choice which one to pay for, based on the miner fees that they want”, Singh explained.
“Some days the Bitcoin (BTC) network will have a high miner fee, some days a low miner fee, where Bitcoin Cash should always have a low miner fee – that way the consumer has a choice and things are always covered that way”, he added.
As someone who purchased BCH when it was worth $2500 per coin and at the time of this writing, is worth $656 per coin, I know a drop in value is frustrating but it doesn’t mean BCH is dying- we’ve seen it all before in 2015 with BTC and we’ll likely see it again, but the number of merchants accepting BCH and other crypto currencies are on the rise and this is good news for everyone.
“The price of Bitcoin (BTC) went up 19x last year, but we only went up 4x. So we don’t go up and down with the price of Bitcoin (BTC) which is great. We just continually grow about 10, 20% every month regardless of what happens to the price of Bitcoin (BTC)”, Singh revealed.
“So in January of this year when the price of Bitcoin (BTC) dropped 70%, we still had our second biggest month ever, actually. So it didn’t really affect us that much. The price of Bitcoin affects the media which obviously gets merchants more excited so it helps our sales cycles a little bit, but it doesn’t really effect the transaction flow”, he said.
“And the person in Korea who is making that one million dollar payment doesn’t care about the price of Bitcoin because they are buying bitcoin at that moment and then sending it over to pay the invoice. At Bitpay, we’re trying to solve real pain points and use cases. Those pain points and use cases don’t really have anything to do with the price of Bitcoin”, he added.
When asked how things are going since BitPay added support for Bitcoin Cash, Singh had nothing but positive feedback and excitement for the future.
“We added support for Bitcoin Cash about a month ago and its been going great, it was a very seamless experience for the merchants and the shoppers, actually. The merchants are now seeing an uptick in Bitcoin Cash payments so we’re pretty excited about that”, he said.
“Again, our goal is to just give more choice to the customer and merchants that are safe and secure. I think more brand awareness needs to be made about these types of other currencies like Bitcoin Cash and what pain point and use case its actually solving and where its actually applicable”, shared Singh.
“The miner fees of Bitcoin (BTC) will go up and down, when it goes up, then Bitcoin Cash becomes more appealing, but even when they are down, where does Bitcoin Cash become more appealing, is it for micro-transactions, is it for cross border…we have to figure out what those use cases are and really spell out the pain points we’re trying to solve”, he added.