Major financial institutions are expanding their cryptocurrency services, with Bakkt launching its digital asset payments application for the general public.
Bakkt was launched by Intercontinental Exchange in 2018, with the firm offering Bitcoin futures contracts to accredited investors exclusively. The Bakkt App is the firm’s first retail-facing crypto initiative.
Bakkt’s app was trialed by 500,000 users invited to participate in its Early Access Program in late 2020. The firm is also conducting a $1 million giveaway to encourage people to download the platform.
Launched on March 30, the payments app allows users to manage Bitcoin and other digital assets, including loyalty points and vouchers, to make purchases. More than 75 major brands are offering discounted gift cards to purchasers who use the Bakkt app, including Choice Hotels, GolfNow, and Best Buy.
Users can also manage their Starbucks Card balance through the platform. Karl Hebert Starbucks’ VP of global card, commerce, and payment, said:
“Starbucks is proud to be an innovation partner with Bakkt. Our teams worked closely together as Bakkt sought input in developing a unique and trusted payment experience that enables customers to unlock the value of their digital assets in the form of US dollars.”
“We’re thrilled to bring the Bakkt App to the public as a step along our journey to expand digital asset access to all,” he added.
In the announcement, Bakkt stated the application is intended to enable “consumers and merchants to unlock the value of $1.2 trillion in digital assets” by incentivizing their use in commerce: “The Bakkt App is designed to amplify consumer spending, reduce payment costs, and bolster merchant loyalty programs."
The payments platform appears to have first been conceived as a partnership between Bakkt and Stabucks in 2019, with Bakkt determining it would release the platform as a standalone app the following year.
The app’s launch comes as competition between financial institutions is heating up in the crypto asset sector, with PayPal rolling out crypto payments for 29 million merchants and Visa unveiling plans for USDC to be exchanged across its credit card network earlier this week.
Goldman Sachs is also moving to expand its cryptocurrency services, with a leaked memo revealing the creation of a Digital Assets Group within its private wealth management division. The group will be tasked with advising clients on digital assets and developing crypto investment products.