Regulating crypto could create American super apps

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Much of Chinese society has become dependent on so-called super apps like WeChat, which have everything from making medical appointments to getting a taxi to getting a loan, all on a single platform.

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But such one-stop shops have not taken off in the United States. Now, the time may finally have come – and the best contenders for super apps come from the fintech world, specifically those platforms dedicated to cryptocurrency.

Cryptocurrencies are rapidly gaining in popularity amid high equity prices, record-low interest rates, and fears of inflation on the horizon, and they could perhaps gain more legitimacy if the US government decides to fully regulate them. , a subject Congress is currently looking for,


Coinbase or even dedicated crypto platforms like PayPal, Venmo and Stripe, which have recently added capabilities to use crypto for payments, may develop into US versions of the Super app, assuming that crypto issuers May work with regulators to find a middle ground between protecting the consumer. Creating new financial and investment opportunities. If consumers view crypto as secure and legitimate – and easy to use – it could form the basis of a super app.

The bottom line is that people are thinking about finances not only when they go to the bank – if they even have access to a bank – but also when they shop, take a vacation or pay for a medical visit.

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Expanding these crypto and payment apps to integrate with other apps and services will make many diverse tasks more convenient. The bottom line is that people are thinking about finances not only when they go to the bank – if they even have access to a bank – but also when they shop, take a vacation or pay for a medical visit, and such. The apps will help provide the financial services they need in a personalized way.

Integrating crypto payments into other functions will go a long way in democratizing the world of finance and money, helping under-served communities and people with no credit histories struggle to open credit cards or have greater access to financial services. struggle to achieve.

rise of super app

WeChat started as a messaging app in china in 2011, but until 2013 it also served as a payment platform and soon offered many other services, such as shopping, food delivery and taxi-sailing.

It now offers over a million different services, mainly through mini apps that businesses develop to work within WeChat. Alipay, which also has over a billion users, is similar. These two apps have been credited over the past decade Changing China from a cash-only economy Except for the intermediate stage of debit and credit cards, there is a heavy reliance on digital payments.

The concept has also become popular Indonesia and elsewhere in the region. The fact that they include financial services, including payment options, is important, and the common thread that runs through the services of many super apps.

But while app usage has exploded in the United States and Europe; Big tech companies like Apple, Facebook and Google have added paid services; And as many payment apps like Venmo and Square become more popular, Super Apps not revealed yet,

This is partly due to data privacy regulations; Privacy laws in the United States, and especially in Europe, limit the data shared between apps, making it hard to create an ecosystem where mini apps can automatically integrate into super apps like Alipay.

It also stems from a well-developed Internet ecosystem in the US, in which popular social media sites, such as Facebook, and payment sites, such as PayPal, existed before the rise of the smartphone, resulting in each of these platforms having separate apps. was launching, rather than a single app offering multiple services. Compare this with China, where Much of the Internet was mobile-first, It has come to the fore only after the arrival of the smartphone. The US market has long been used to segregate platforms for different tasks.

But many analysts point to app and tech companies adding more services — like adding TikTok shopping, integrating mini apps for Snapchat games or entering the Apple payments space — and say that Super Apps Will Finally Emerge In the US, or at least larger apps that can do more. Adding more services to a single app, and finding a way to keep users on it, is also a way around privacy rules that prevent one app from knowing what its users do on another app.

The apps are clearly on their way to getting bigger and more widespread, even though it’s unlikely the US will end up with only one or two major ones, as seen in Asian markets.

rise of defi

Meanwhile, cryptocurrency has evolved over the past decade with payment apps and super apps. What started as a product, bitcoin, has evolved into a The entire peer-to-peer financial system, known as DeFi, Allows users to invest, trade, spend and lend money, with multiple currencies including Ethereum and Dogecoin.

but despite its boom Popularity, especially during the economic uncertainty arising out of the COVID pandemic, and more Traditional financial institutions are starting to offer some crypto-related services, it remains outside the mainstream financial system and sector, Many experts say it is high risk. Crypto issuers have also long resisted regulation, as it would go against their goal of having a decentralized financial product.

But now that things are starting to change, some crypto platforms have expressed interest in following the rules.

For example, Coinbase abandoned plans to offer an interest-earning product that would allow users to earn interest on coins lent to others, After the US Securities and Exchange Commission failed to provide guidance on this and threatened to sue Coinbase for issuing it. Actually, Crypto issuers are realizing that some regulation will give more legitimacy to their product And allow more people to use it for more purposes. This comes as new crypto products recently hit the market, including stablecoins, which track the value of traditional currencies.

regulation of crypto, an idea that SEC Chairman Gary Gensler Has said that support, some in Congress and some in the crypto industry, may actually be on the horizon.

Using cryptocurrency to promote the first US super app

If crypto issuers work with government officials to establish regulations that protect consumers without limiting innovation, crypto is a good bet that eventually inspired the American super app.

Think about what could happen if Coinbase works with the SEC and aligns on smart regulation that will validate Coinbase as a viable and proven financial intermediary that users can rely on for crypto, in addition to Embrace both of their new financial products with potentially attractive yields. Its ability to be used for everyday expenses. Regulation would potentially stabilize currencies, turning them into something practical to purchase rather than hold for potential value. Such regulations would also eliminate some steps that add friction to current user experiences for using crypto in everyday life, such as Long transaction times, high transaction fees And Huge fluctuations in its value.

A regulatory framework would unlock massive demand for crypto, and suddenly there will be many businesses – from restaurants to retail – that want a way to process crypto payments, prompting them to integrate them into existing crypto payment apps. and inspire them to develop into super apps. , More people will also deposit in crypto on these apps instead of using traditional currencies at their banks. It will disrupt the entire economy and financial ecosystem.

Banks have always created products that they understand to the public Wants While the world of crypto and DeFi is clearly providing products and services to people need, And millions are already using them, despite their precarious regulatory and legal status.

Just as ubiquitous and unified digital payments in China emerged to meet a need – a cash alternative in a market deprived of credit cards – the crypto-based super app was created by consumers and businesses looking for a secure and efficient way to use crypto. will meet the needs of Instead of, or in addition to, traditional payment methods.

If crypto remains an unregulated gray zone, and its platforms remain isolated from the rest of economic and daily life instead of evolving into super apps, the United States may have an opportunity to create a new and innovative mobile- and digital-first financial ecosystem. will be missed. ,

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