- Consumers can now pay crypto to several retailers via Fold, which eliminates the risk of cryptocurrency volatility to merchants.
- Fold expects a margin from merchants for bringing in new customers but will not be charging fees from consumers.
Fold, a well-known payments platform is launching a lightning network protocol that will reportedly allow the users to shop in-store or online at several retailers, including Starbucks, Whole Foods, AMC, Home Depot and Southwest Airlines.
Though users will be transacting in Bitcoins, the payments will be settled in the currency that the merchant opts for. While this helps in removing the crypto volatility risk for the merchant, it also will help in expanding the potential client base who prefer to transact in Bitcoins.
Will Reeves, CEO of Fold said that the protocol would integrate with the existing payment systems in a retailer’s POS dealing “directly with prepaid access programs like gift cards, store credit, rails or other options merchants are used to accepting.”
Notably, there is no connection between Fold and any of these name-brand retailers. Transactions will be displayed in fiat on a company’s balance sheet as wither gift card purchase or store credit, depending on the way Fiat integrates with a particular POS. The merger neither requires installation of the new hardware or software nor requires any effort on the merchant’s side.
According to Reeves, Fold started the work on this P2P project last year. He said that he saw lightning network transactions as a way to have customers use crypto not just as a store of value, but a payment means. He added:
“Customers navigate to the Fold app, where they are presented with a list of available merchants. They then select the denomination and how much they want to spend,”
Fold is non-custodial and enables users to operate any wallet of their choice. Once an invoice is populated, it immediately displays a barcode or other payment method” generated via the merchant’s gift card API. The process is expected to take around 30 seconds.
Reeves wrote in a company statement:
“We believe that Bitcoin provides a fundamentally better way to pay, one that preserves privacy, resists censorship and is natively global. To this end, we build products that make spending bitcoin a no-brainer, making it as easy to use, rewarding and widely accepted as a credit card.”
Fold will not be charging any fee for this service. However, it expects to receive a margin of the transactions from retailers for bringing in additional customers. The firm generates revenue,” and is “not venture reliant,” Reeves said. Additionally, Fold is also planning to launch a product update that will pave new ways for its clients to earn Bitcoins by using the app.