Why Amazon should Develop Its own Cryptocurrency
Cryptocurrencies have reached a feverish pitch of interest in late 2017, and while many are pushing for Amazon to accept Bitcoin, I propose a much more radical solution.
Amazon should make its own cryptocurrency.
The Age of Cryptocurrencies have Begun
With bitcoin reaching $7,000 today, there’s a funny movement going on. There’s literally a petition for Amazon to accept various cryptocurrencies.
2017 has been a torrential year for the blockchain, initial coin offerings and the emergence of cryptocurrencies into the mainstream. Big tech companies are offering blockchain-as-a-service in the Cloud, and importantly, many countries have announced plans to create a cryptocurrency version of their currency to be regulated by their central banks. So these will be on the blockchain, but not decentralized:
- Probably China.
Amazon Bought Its Own Cryptocurrency Related Domains
Since today Amazon has registered three new cryptocurrency-related domains, we can clearly see Amazon is going the Ethereum route and not the Bitcoin route. They are:
- AmazonEthereum dot com
- Amazoncryptocurrency . com
- Amazoncryptocurrencies .com
The catch is, according to Coindesk, Amazon already owns the “amazonbitcoin.com” domain name.
With 90 Million Prime Members, set to exceed Netflix subscribers in 2018, Amazon accounts for over 40% of all E-commerce sales in the U.S., and this is growing. It’s investing more than ever in Amazon Prime Video and its takeover of E-commerce in the fastly growing Indian market. India happens to be very forward looking in #FinTech and Amazon Pay is increasing accordingly.
What if they converted to a cryptocurrency on the blockchain?
This would boost trust of Millennial consumers in dealing with them.
This could also be their “in” to banking and financial services, data they would like to have of their best consumers.
To be the most customer-centric company means having the most integrative in-house native data on each consumer. As tech companies scale to the age of Artificial Intelligence, it’s really that simple.
Amazon Could Disrupt Banking
Amazon can not only disrupt the payments industry (Stripe is among their partners), but get into banking services that’s data-based and more customer-centric than current financial services institutions.
That Amazon already has Amazon Coins, a digital payment method that can be used to purchase software for Kindle and from within or from the Amazon Appstore. 100 Amazon Coins are worth $1.00 to spend on apps, games, and in-app items. This displays Amazon’s already existing interest in creating its own ecosystem. An Amazon based cryptocurrency on the blockchain might be the perfect way to do that.
Amazon Restaurants provides a food delivery hub that I think it’s key in how Amazon’s app, Alexa and Amazon Pay can work in the future tailored to the needs of the new consumer. This is where a native Amazon cryptocurrency could first be spent, scaling out eventually to all of its services.
Why Amazon Needs a Native Cryptocurrency
A native Amazon cryptocurrency could be the currency that unites Amazon’s data play on consumer preferences, financial services, health data and services and a unified consumer database, that eventually could enable it to become the top advertizer in the world.
In such a scenario Amazon has to make its app more ubiquitous as well as the next generation of apps, that are Alexa skills. Amazon Pay already has this feel, where consumers can add cash to their Amazon accounts with earn reward incentives, what is essentially a banking account within the Amazon ecosystem, but I believe this does not go far enough. Having a native cryptocurrency would brand Amazon to the next level.
So in terms of speed of transactions, scale, and public relations having a native cryptocurrency on the blockchain would also be the first step for Amazon to disrupt traditional banking.
As Amazon continues to offer more services, citizens could progressively live within its ecosystem. In such a world, even prices could eventually be personalized to different consumers via predictive analytics relative to our life circumstances for the optimal customer experience. This kind of dynamic pricing is not only more profitable, it’s more fair to consumers of different incomes.
Amazon introduced Amazon coins 4.5 years ago, it’s ready soon for the next level of it’s foray into FinTech and banking. While rumors about Amazon starting to accept Bitcoin payments are abundant, we have to assume that’s only a small play in a unified strategy where a native cryptocurrency would be a more central piece of the puzzle.
While Bitcoin continues to soar, it’s likely Amazon will create it’s own cryptocurrency solution that leverages the incredible trust consumers have in its solution and growing ecosystem of convenience, speed, fulfillment and retailtainment. In 2018, we’ll see even more major companies adopting blockchain and throwing their hat into the ring that are cryptocurrencies and the quickly emerging evolution of payments.
Amazon Desperately Needs a Social App
With India’s Paytm hitting 200 million users and now adding chat to directly take on WhatsApp in India, Amazon needs to starting thinking how to take on WeChat, Alipay and WhatsApp with its own app or acquire a candidate that could be the one app for all of Amazon’s social and functional interactions.
This will likely be the chat app Amazon is working on called Anytime. Amazon significantly lacks a consumer facing SMS app that it can adopt to stimulate app-engagement and retention time in an app. While Facebook and Tencent have entire ecosystems of apps, Amazon needs to up its game in that area significantly to tie into its emergence on the blockchain before 2020.
If the central banks of countries are rushing to create their own fiat cryptocurrencies, tech companies are like the countries of the future. It doesn’t make much sense for an Amazon, Microsoft, IBM or Alibaba to let solutions such as Ethereum or NEO be the smart contract platforms of the future in enterprise blockchain. AWS is already offering blockchain as a service on the cloud. However, we have to assume that’s only the beginning.
Amazon Prime Bank is Coming
Amazon is definately ready to start an Amazon Prime Bank, how quickly or what form it would take remains speculations, but that it would include a proprietary Amazon cryptocurrency is almost assured. In a future article I’ll talk more about how Amazon will disrupt banking and financial services.
Having its own cryptocurrency is the first step, and we should expect it before 2020.