#62 Corporate Greed Extends to Blockchain. The Starbucks Odyssey Begins.
Disclaimer: Everything we write in "The Crypto Insider Report" is an x-ray of the industry as we see it, through the lens of publicly available information. We are not financial advisors.
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Nigeria Further Limits Cash Withdrawals in Push for CDBC Adoption
Nigeria’s Central Bank has just imposed a daily cap on how much cash people can withdraw from an ATM - just 45 USD equivalent per day. Why would they do this? Well, it’s all about pushing people to move away from cash and start using digital payments, targeting the digital currency released one year ago, eNaira.
If an individual wants to withdraw more than the 45 USD limit, they can go to a bank and perform an over-the-counter withdrawal, paying a 5% fee. The previous limit was fairly low already - 338 USD per week for individuals, but CDBC use did not gain traction, with just 0.5% of the population using it a year after its launch.
The move is controversial, to say the least. Critics say it’s a violation of people’s financial freedom and privacy. By limiting cash even more, people will be forced to use digital alternatives only, alternatives that can be fully tracked and monitored. The Central Bank argues that this move will improve security and efficiency by limiting criminality and lowering banking costs.
As always, there are two sides to each story and there are both good and bad things to be said about going for digital payments. Ideally, people should have a choice and guardrails should be in place. Imagine a radical political party taking over and deciding to identify everybody who ever donated or supported certain causes that are against their beliefs - CDBC allows for that. At the same time, technology is an enabler that can make our lives so much easier. It’s all about how it is used.
Mihnea
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Corporate Greed Extends to Blockchain
Apple is the largest company by current market cap, >$2.25tn. And despite recent drawdowns regarding lower production capacity for the latest iPhone 14 Pro & Pro Max, they are still holding up well. Their valuation does not only come from selling iPhones, Ipads and Macs. In fact, Services bring a lot of revenue, sometimes as much as 50% of that of phone sales (notice the increase over time).
This “Services” segment of their revenue also includes revenue from the App Stores, where Apple gets as much as a 30% commission rate for apps and their revenue. Recently, Coinbase reported that their Wallet app on iOS was blocked due to an update allowing users to send NFTs:
What Apple is basically doing is that they won’t allow Coinbase to use the blockchain for transactions (??), instead forcing them to run the transactions through their In-App purchase system to collect 30% of the gas fees. What?! Need I tell you that Apple’s system does not support crypto, making what they ask impossible?
This isn’t Apple’s first rodeo with someone having problems with their fee system. In 2020, Epic Games sued Apple after the latter removed Fortnite from the App Store following Epic Games’ attempt at circumventing the 30% tax on all in-app purchases. After the scandal, Apple implemented a 15% fee program for developers making up to $1 million a year in in-app sales but that is not enough. Yes, they are a giant in the software industry but taking advantage of their position can only go so far before someone or something snaps and things take a downturn.
Given their conditions for allowing Coinbase’s wallet to function normally in their App Store, we can conclude that not even tech giants fully understand how the blockchain works. We have a long ways to go before we get crypto-native apps that are able to flourish (which makes me respect Solana’s attempt at making a phone, Saga, even more). Until then, the blockchain is not circumventable and will not allow Apple to redirect part of the profits to them, at least not at the customer’s direct expense.
Matei
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The Starbucks Odyssey Begins
When it comes to digital innovation, Starbucks has been a pioneer on a number of fronts. Some say its new Web3 loyalty program will be a litmus test far beyond the world of coffee. On Thursday, the coffee giant announced the beta launch of Starbucks Odyssey, the company’s first major attempt at integrating blockchain tech into its existing rewards program. Starting with a small group of U.S. members and employees, Starbucks will invite participants into “journeys” that allow them to collect NFTs and points that unlock new benefits and experiences.
However, Starbucks’ brand ubiquity and history of digital innovation put Odyssey even more under the microscope. Marketers and industry observers say they are watching the rollout of the program as it could be a bellwether for how much consumers are willing to care about branded NFTs.
Odyssey, which was first announced in September and will expand to more people in January 2023, makes Starbucks one of the largest brands to integrate NFTs into its loyalty program. Activities will include taking a virtual tour of a coffee farm, learning about Starbuck's history and playing interactive games. The rewards for collecting NFTs include virtual espresso martini-making classes, access to merchandise and artist collaborations and invites to events at Starbucks stores and coffee farms.
The company says it will send monthly invitations to others on the waitlist beginning in January. Members who were invited to the beta launch will also have access to the Starbucks Odyssey market powered by Nifty Gateway, where users can buy and sell their digital collectible Stamps.
Andy Sack, co-founder and co-CEO of Forum3, which helped to bring the Odyssey project to life, told CoinDesk the idea was sparked by a desire to "delight the consumer with unique digital experiences." Sack started Forum3 with former Starbucks Chief Digital Officer Adam Brotman, who led the creation of Starbucks' loyalty mobile app which boasts over 50 million registered users.
Sack refers to the new program as a "next-generation loyalty platform" aimed at building a brand relationship between customers and Starbucks. He told CoinDesk that other brands are starting to integrate blockchain technologies, making Web3 experiences more accessible to a mainstream audience.
Evelyne
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