Apple Pay, Tipping Points & Cryptocurrencies

When Apple launched its Apple Pay mobile wallet four years ago, it was an example of nifty technology that was way ahead of critical infrastructure. As a cutting edge technology company, Apple has always led the way, a pioneer in ecosystem-driven advancement, such as the iPod (you didn’t know you needed one until you knew you needed one) and the smart phone — remember when Nokia (who?) was still telling us there would never come a day when a phone would have no buttons? Steve Jobs once famously said,

“Some people say, “Give the customers what they want.” But that’s not my approach. Our job is to figure out what they’re going to want before they do. I think Henry Ford once said, “If I’d asked customers what they wanted, they would have told me, ‘A faster horse!’” People don’t know what they want until you show it to them. That’s why I never rely on market research. Our task is to read things that are not yet on the page.”

So Apple Pay made for a great demo when it was launched to much fanfare, but there weren’t many places you could use it — which for a payment technology would be a critical point of failure. What’s the use in having a wallet if you can’t spend anything out of it?

In 2014 Apple says only 3% of U.S. retail locations were equipped with the near-field communication technology or contactless payment systems that Apple Pay required to work. And if Apple had listened to merchants, they would never have launched Apple Pay (who needs another point-of-sale transaction terminal to crowd out an already cluttered checkout counter?). But fortunately, despite Steve Jobs’s passing, Apple has continued to perpetuate its founder’s vision of becoming the future that they seek. Today, retailers have swapped out cash registers for readers and usage of Apple Pay and competing products has exploded, with more than 5 million U.S. merchant locations or more than half of all U.S. merchants accepting Apple Pay, including important retailers such as CVS and 7-Eleven which rolled out Apple Pay in September.

For Apple Pay and other contactless payment service providers, the tipping point has been reached, where the benefits to merchants of providing contactless payment outweigh the costs.

When crypto?

One of the biggest criticisms hurled at crypto is that it can’t be readily used. That’s true. For now.

And while it doesn’t necessarily follow that it’s just a matter of time before cryptocurrencies are widely available for use, there’s no denying that a great deal of time, resource and human capital is being invested into the industry to change that. From payment gateway service providers like Pundi X who are rolling out point-of-sale systems in unbanked developing countries to Circle which is positioning itself as the financial services solution for the cryptosphere, billions of dollars are being poured in anticipation of the day when using crypto will be as easy as using Apple Pay.

It’s hard to envisage that day right now. Because so many of us are used to seeing the world as it is or as it was, but it’s often not so easy to see the world as it can be. This tip of the nose sort of predictive capability is an undeniable part of human nature and must be conscientiously avoided and disciplined for in order to attempt a rational and reasoned forecast for the future.

While in the very near term, it’s highly unlikely that crypto will become the next defacto payment mechanism and source of value transfer, as we roll out the forecast to decades, it’s not so clear.

So far Apple has been relatively silent when it comes to cryptocurrencies. Perhaps there’s a reason for that.