Emergent fintech such as distributed ledger-based blockchain technology and the cryptocurrencies built thereupon are rapidly transforming the face of the financial industry, reshaping how money is used at an essential level. An explosion of fintech companies marks the dawn of this new era, quickly turning the financial institutions that historically have played middlemen into dinosaurs as an increasing number of businesses and individuals turn to peer-to-peer (P2P) and peer-to-business (P2B) transaction options. This is a hot market for disruptive fintech developers such as Virtual Crypto Technologies Inc. (OTC:VRCP) (VRCP Profile), with its cryptocurrency transaction confirmation application programming interface (API) Bit4Sure, real-time cryptography-based algorithmic cryptocurrency transaction validation engine NetoBit and crypto point-of-sale (POS) offerings such as NetoBit Pay that use the NetoBit application. For payment tech giants such as Square, Inc. (NYSE:SQ) and Worldpay, Inc. (NYSE:WP), or P2P lending innovators such as LendingClub Corporation (NYSE:LC), the iron is now ready to strike and blockchain powerhouses, such as Broadridge Financial Solutions, Inc. (NYSE:BR), will add considerable force to the hammer blows as the industry forges a new future for money.
Fintech Cutting Out the Middleman
The stage has been set for a genuine sea change in relevant areas of the financial industry. From payment technologies to lending and raising capital, even insurance and the kinds of accounts or wallets people use – a bevy of alternatives are already live or are coming online in the near future.
The number of options available to end users in particular has multiplied seemingly overnight, providing a whole slew of new ways to deal directly with other people or entities, cutting out the financial institution middlemen altogether. Global fintech funding was more than $31 billion last year, with the United States representing around half of that figure, according to KPMG Fintech. Analysts see the sector maturing away from experimentation into value-driven opportunity hunting based on proven solutions.
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With more than 2,446 Bitcoin (Crypto:BTC) ATMs currently installed across North America, it is now easier than ever for people to purchase and convert money via cryptocurrency such as BTC and then cash out into traditional fiat currency. However, only around 36 percent of existing Bitcoin ATMs allow users to exchange crypto for cash, with the majority considered one-way machines that only allow users to directly purchase crypto. Transaction fees and times have been the biggest gripe by end users, and it is now understood by many in the industry that eliminating these two barriers will likely trigger an even more massive influx of new crypto participants.
Crypto Tech, a Peer-to-Peer Revolution
The global crypto ATM market is on track to surpass $285 million within the next eight years, running at a smoking hot 45.8 percent CAGR on the strength of increased crypto awareness and popularity – popularity bolstered by the public’s receptivity toward key ideological elements such as decentralization of the underlying blockchain network(s), as well as transaction security and constant technological innovation. A striking example of such emergent fintech transforming the financial industry is evident in a report where Steve Forbes recently touted crypto as the future of raising money in the $40.6 billion global film industry. A seemingly bold claim, until you notice that initial coin offerings (ICOs) raised a record $5.6 billion last year.
Building a Better Crypto Mousetrap
With the official launch of the company’s proprietary API-driven Bit4Sure cryptocurrency transaction confirmation solution in early May, Virtual Crypto Technologies Inc. (OTCQB: VRCP) has effectively annihilated the 10 minutes to 24 hours it can take to confirm the purchase or sale of bitcoins. Alon Dayan, co-founder and CEO of Virtual Crypto, noted how strategic this achievement was for the company, characterizing it as a major step towards VRCP’s overarching goal of building consumer confidence in the cryptocurrency marketplace. By removing much of the risk associated with such autonomous transactions through real-time transparency, Virtual Crypto has indeed taken out one of the aforementioned barriers to bringing more people into the space. Bit4Sure essentially allows users to confirm a transaction before it is included in a mined block on the chain, and it does so via a readily available and intuitive app that works with Android and iOS. It is also available via web browser at bit4sure.com.
The solution is a compelling proof of concept, exposed to the average user through easy-to-use protocols. However, the API is the real gem here and is attractive to exchanges, payment processors and wallet developers who can subscribe, thereby gaining access to the company’s proprietary algorithm model. The Bit4Sure API lets developers integrate real-time transaction confirmation as well as the ability to actively track the market activity of any cryptocurrency, empowering end users and shielding them from digital payment risks such as double-spending fraud or delayed transaction hassles.
Broad Ranging Vision and the Tech to Back It Up
The company has a clear vision of becoming a driving force for the widespread adoption of crypto, with a hardware/software umbrella spanning ATMs, tablets, PCs and mobile devices. Virtual Crypto’s two-way NetoBit ATM supports most local currencies, multiplexes together several exchanges to provide the best prices/rates, and allows for real-time withdrawal and transfer of funds in mere seconds. NetoBit Pay closes the gap on the merchant end of the spectrum with a simple-to-use retail POS. And because every transaction is guaranteed up to $3,000, businesses can rest easy, leaving their minds free to engage in crypto-based transactions without fear of being ripped off.
The company has a clear vision of becoming a driving force for the widespread adoption of crypto, with a hardware/software umbrella spanning ATMs, tablets, PCs and mobile devices. Virtual Crypto’s two-way NetoBit ATM supports most currencies, multiplexes together several exchanges to provide the best prices/rates and allows for real-time withdrawal and transfer of funds in mere seconds. NetoBit Pay closes the gap on the merchant end of the spectrum with a simple to use retail POS. And because every transaction is guaranteed up to $3,000, most consumers can rest easy, leaving their minds free to engage in crypto-based transactions without fear of being ripped off.
Virtual Crypto has established itself as a business-oriented developer that dramatically improves the cryptocurrency trading experience for individuals and businesses – those who benefit the most from faster execution and lower costs. The company may seem like a small fish in a gigantic pond, but it may provide offerings and competencies that even the biggest fintech players are taking note of.
Among those fintech giants, Square (NYSE:SQ) garnered attention recently when it hit an all-time high (and held it) on news of its approval for a BitLicense from the New York Department of Financial Services, opening up the commerce of Bitcoin in that location via the company’s popular Cash App. The Cash App solution is a direct competitor to PayPal’s (NASDAQ: PYPL) mobile payment service Venmo. The fact that Square barely eked out a profit in Q1 from BTC buying and selling activity and yet still doubled down on its objectives showcases how hotly contested the digital-first money-transfer services market is. With prepaid and private label cards accounting for some $6.4 trillion last year alone, such crypto-powered e-payment systems could make a killing by alleviating the inconvenience of card minimums for customers, as well as lowering and stabilizing merchant’s swipe fee rates.
Since the J.P. Morgan (NYSE: JPM)-assisted acquisition by Vantiv, Worldpay (NYSE:WP) has become one of the most actively traded payment processors in the game today. Worldpay handles over 40 billion transactions a year via 300 payment types, in 146 countries, across 126 different currencies. The company has recently drawn attention as a high-profile publicly traded target amid an outbreak of market participants looking to lock down the underexposed fintech space, which has seen very few public listings despite record levels of venture capital funding. Those participants include Augmentum Capital, the venture group backed by Lord Rothschild, which recently deployed a well-capitalized VC arm. Worldpay drew heat in February alongside Visa (NYSE: V) when major crypto exchange Coinbase laid the blame at their feet after the exchange’s customers were charged multiple times for the same transaction because of a merchant category code glitch.
Long hailed as a pioneer in marketplace lending, LendingClub (NYSE:LC) uses technology to spur faster credit decisioning and drive loan origination to new user experience highs. The company has seen its model stall somewhat as competition comes into the market from sources like Marcus, the lending and deposit-taking digital consumer platform launched by Goldman Sachs (NYSE: GS) in 2016. LendingClub’s aggressive model has been groundbreaking, with rapid origination of unsecured personal loans and the generation of revenue as the loans are eventually sold or offered to investors, traded and then serviced. However, this aggressive model has led to loan stacking by fraudsters and desperate borrowers, putting increasing pressure on the Icarus-like LendingClub to fall back to earth and act just like every other digital lending platform, with its primary emphasis on competition for the most creditworthy customers.
A global fintech player with its roots in blockchain tech, Broadridge Financial Solutions (NYSE:BR) recently completed a second practical pilot use of blockchain for investor voting alongside Santander (NYSE:SAN) at the annual general meeting, in collaboration with J.P. Morgan and Northern Trust (NASDAQ:NTRS). This event followed fast on the heels of Broadridge receiving a new patent from the U.S. Patent and Trademark Office that allowed the company to begin implementing distributed ledger technology in its proxy voting product suite, ProxyVote. ProxyVote could revolutionize aspects of corporate governance in capital markets, particularly when it comes to tackling new issues, including compliance with the EU’s Shareholder Rights Directive 2.
The Big Boys Could Learn a Lot from Smaller Developers
It is plain to see that with innovation and first-mover advantages can come unforeseen risks and model implementation issues. As cutting-edge fintech enabled by cryptocurrencies and their underlying blockchain technology works its way into more and more practical applications, it may be essential for innovators to remain grounded in proven solutions like those offered by companies such as VRCP. With more than 1,000 cryptocurrencies on the market today and only minimal uptake by end users, delivering confidence will be a key concern moving forward and fintech developers must remain laser focused on creating positive user experiences through transparency, ease of use and affordable fees.
For more information on Virtual Crypto Technologies, please visit Virtual Crypto Technologies (OTCQB: VRCP).