Mar 7, 2021 • 8M

Ep 13. Pay with crypto, Brave & more

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Some say Crypto is a scam. Others swear it's a breakthrough technology. But which is it? Join us, as we explore Crypto in real life (IRL).
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Welcome to the 5x5 Crypto podcast. Each week, we cover the “so what’ of 5 key crypto stories in about 5 minutes. My name is Afo and I’m interested in crypto. I think you’ll enjoy this week’s episode. Like and subscribe on iTunes, Spotify, and Substack. Let’s go!

This year has been flying by. Can’t believe its already one week to pi day. I’m looking forward to some good shepherds pie, key lime pie, and Patti LaBelle’s sweet potato pie…hmm. But that’s not why we are here. Crypto. This week did not disappoint. NFTs are still booming, corporates are making moves and bitcoin mining is under pressure. Let’s dive in.

  1. Pay with crypto

    • Rakuten launches a cryptocurrency that enables users to pay within their ecosystem

    • Customers can earn rewards too

      So what?

    • One of the biggest criticisms of cryptocurrencies is the inability to pay for regular expenses like rent, utilities, and groceries.

    • To be clear, it’s possible but not easy. I know of a guy who lived off bitcoin for 3 years in San Francisco. That’s a different story.

    • Rakuten is often called the “Amazon of Japan”. The company serves over 1 billion people across 30 countries. The conglomerate includes a range of businesses including the largest e-commerce site in Japan

    • Rakuten is launching Rakuten Cash, a cryptocurrency that can be obtained for free by exchanging bitcoin or other cryptocurrencies. This enables users to essentially shop across Rakuten with cryptocurrencies.

    • I am excited to see how much traction this gets. I bet other platform companies like Amazon and Apple are paying attention but they would need to tread carefully given how the Facebook-backed Libra (now called Diem) project fared.

  2. PayPal deepens crypto ambitions

    • PayPal is creating a new business unit focused on crypto and digital currencies

    • PayPal is reportedly acquiring a Curv, a crypto custodian

      So what?

    • PayPal wants to become a SuperApp. Enabling users to pay, however, they want is a big part of that. The company also recognizes efficiencies from using cryptocurrencies.

    • Last year, PayPal enabled its US users to buy and hold bitcoin and a few other cryptocurrencies using their app. This year, they will extend that offering to a greater share of its 346 million users while also enabling its 26 million merchants to receive cryptocurrency payments

    • The purchase of a crypto custodian like Curv would position PayPal to offer more crypto services while driving down the costs of operations

    • We should expect more activity as PayPal builds out the new crypto business unit

  3. China bitcoin mining down; Canadian Bitfarms bought 48,000 new machines and 8x production by Dec 2022; Bitcoin miners brought in record $1.36B in Feb

    • Chinese province cracking down on energy intensive industries including bitcoin mining

    • US and Canadian bitcoin miners continue to invest

      So what?

    • Bitcoin miners earned $1.36B in Feb 2021. High revenue helped fuel vigorous debate about high energy consumption.

    • Inner Mongolia, a Chinese province, accounts for 8% of global bitcoin production. The local government has banned new projects and is shutting down existing ones in April. The local government is also taking a look at other high consumption industries like steel production. That said, bitcoin mining is a lot more mobile than steel, so it makes to focus on that first.

    • Meanwhile, US and Canadian bitcoin miners continue to expand. We have previously new projects in West Texas and now Bitfarms is buying 48,000 new machines to 8x its production capacity by next Christmas. In a reversal of manufacturing trends, we could see more bitcoin mining migrate from the East to the West. Let’s see.

  4. Brave is launching search

    • Brave is the privacy-first web browser. This week, it announced plan to launch search in the first half of 2021.

      So what?

    • Brave was launched in 2019 by one of the co-founders of Mozilla. It is ad free web browser that loads 60% faster than Chrome.

    • One of the cool things, is that Brave allows you to opt into watching ads and earn BAT - Brave’s cryptocurrency. Additionally, you can also tip some participating websites in BAT.

    • I am a power user of Wikipedia and you know how they run campaigns asking for donations. Honestly, I think I tried to contribute at least once but not sure if I finished the transaction. That said, I would be much more inclined to donate to Wikipedia if I had money coming into my Brave wallet.

    • Anyway, search is a huge business. Google has over 90% market share. If Brave can develop a competitive offering that gets traction, they could onboard millions of people onto cryptocurrencies and help usher in Web 3.0

    • I’ve joined the waitlist. Stay tuned.

  5. NFT craze continues

    • King of Leon and 3LAU launch NFT albums

    • Jack Dorsey is auctioning the first tweet as an NFT

    • Square buys Tidal

      So what?

    • Last week, we touched on the booming NFT art market. Now it’s extending to music with the Kings of Leon selling collectible albums as NFTs.

    • Jack Dorsey jumped into the action by auctioning off the first tweet. Last, I checked, the highest bid was $2.5M. The cool thing about NFTs is that Jack will get a slice of the pie whenever the tweet is resold.

    • This week, Square announced it was buying Tidal with Jay Z joining Jack Dorsey and others on the board of Square. Perhaps there’s a world where Square helps musicians and other creatives issue NFTs and get their far share. Not sure how this is going to play out, but I’m curious. What do you think?