How Is Abra And Coinbase Viewing The Future Of Bitcoin?
Where is the Bitcoin positioned in the crypto world? What is Abra? How does Coinbase view Bitcoin?
Abra Has Raised $12M In Funding For Its Bitcoin-Based Remittance Service
Closing in $ 12 million in Series A funding is a remittance service built on top of the blockchain known as Abra. It is known that the investors in the round include Arbor Ventures, RRE Ventures as well as FirstRound Capital with total funding by the company totaling $ 14million. To be launched soon the company’s app lets users around the world transfer funds that are denominated in any currency and also at a cost-effective rate. The reason behind Abra achieving this is by instantly converting deposited currency to Bitcoin stored locally on the user’s device meaning that unlike services like Venmo, the company has never actually touched funds, as it isn’t required to deal with regulatory issues of transmitting money.
Following is the process of how Abra works: when it is the users depositing money into the app, it is either via a linked bank account or by utilizing Abra’s network of Abra Tellers that are like human ATMs. Following this after setting their fees, Tellers meet the user in the person accepting a cash deposit and crediting the user’s account with funds or vice versa as the user wants to cash out. Consequently, as the user’s account is credited with funds, the money is instantly converted to Bitcoin behind the scenes where they are still denominated in a traditional currency.
Here the important question that pops up is how Abra combat bitcoin’s extreme volatility as they allow digital currency that is always pegged to fiat currency. The CEO of Abra, Bill Barhydt has explained that Abra has instantly created self-setting contracts for users built on blockchain assigned to a counterparty sharing in the hedge. The users are given a short contract to protect the price while the assigned counterparty is going long on the hedge. Further on Barhydt explains that the company found willing counterparties from across the Bitcoin ecosystem ranging anywhere from exchanges to mining companies.
These behind the scene works are complex as Barhydt stresses users can use the service not knowing any of the complexities of Bitcoin and blockchain. In this case, two users send each other$100 and even if Bitcoin is being transferred, both see the transaction denominated in dollars.
Further on the company moves to generate revenue by charging a .25 percent fee to the user as and when they transact with Abra Teller by charging a small fee to the counterparties involved with smart contracts. Launching soon, the company is currently accepting Teller applications saying it currently has Tellers signed up in over 80 countries.
Coinbase CEO Brian Armstrong Comments On The Future Of Bitcoin
Coinbase co-founder and CEO Brian Armstrong joined Alex Wilhelm to discuss the future of Bitcoin right after opening its doors to Europe. It was during this conversation that it was found covering everything that is happening currently around Bitcoin from the regulatory issues to the bitcoin’s price downfall, the merchant adoption, and the new innovative Bitcoin use cases.
Armstrong was quoted as saying that they were in the rebuilding period after the most recent bubble. It was meanwhile noted that Bitcoin is currently trading just under $ 400 as it was over $600 a couple of months ago. With a big downturn apparently, nothing is to be worried about as price volatility doesn’t seem to affect transaction numbers a lot.
He continues that in case the data is looked up over the last two years, there is the number of transactions continuing to grow up. Bitcoin has gone through these bubble periods when it comes to the USD volume. With internal metrics, Coinbase is deeply related to mainstream bitcoins adoption. The relevant question in this segment comes as are deposits growing? Are there more people signing up? Are people using bitcoins for commerce? Month over a month these numbers are being watched going up.
Is There Any Rival For Bitcoin?
Even after this Bitcoin is still a novelty in many ways as to how can we be sure that Bitcoin is not just a fad? Armstrong says that they are just seeing a classic hype cycle. In 2001 the Internet came with NASDAQ crashing down in many ways as Bitcoin is the most exciting technology since the internet as they think.
While going around the world doing a few meetups in major European cities to introduce Coinbase to local Bitcoin communities Armstrong sees a lot of excitement in Berlin, London, Paris, Amsterdam where Bitcoin developers aren’t representative of the average Bitcoin user, whereas Coinbase also works very hard bringing online merchants on board making them accept Bitcoin payments.
Continuing on the subject, Armstrong says that overstock was the first billion-dollar merchant accepting Bitcoin payments whereas now there are ten of them. With Coinbase’s API is not only for very big merchants and if you look on GitHub, what people are building you find they use the Coinbase API more than any other.
The Final Thoughts
When talking about the regulatory issues doing rounds currently, Armstrong is careful not to be too critical of New York’s’ controversial BitLicense proposal as New York wants to continue to be a leader in finance protecting customers wanting to encourage startups to move there. He further continues that they don’t think they have accomplished the goals where BitLicense goes a bit further than any other regulation out there. While it’s a little unclear at this point, Coinbase has incidentally reached out proactively to cryptocurrency regulators.
With no other choice but to be optimistic, about the future of Bitcoin regulation Armstrong says nothing is set in stone yet as the company’s best interest advocates for less restriction as he says that he thinks it’s going to end up a lot like the internet. Whereas some countries are trying to regulate the internet where Bitcoin is very much like that being legal with some countries going with currency control.