Telecoms and Cryptocurrencies: Will the Partnership Work This Time?
While traditional banks are not so eager to adopt crypto coins or other forms of digital assets, telecoms may be one of the vectors for mainstream adoption.
Recently, CoinText released a payment protocol for Bitcoin Cash transactions through SMS. This would allow users to send and receive value based on an ordinary phone connection, reaching users without access to smartphones or banks.
"Being able to transact an international currency like Bitcoin Cash over text message with any phone in the world will uncap the vast economic potential for the unbanked. Settling transactions directly on-chain allows us to build so many simple useful tools. This SMS wallet is just the start," said Vin Armani, lead developer at CoinText.
SMS payments have been around for a while, serving as the go-to solution for some regions. One of the most notable examples is the more widely known M-Pesa in Kenya, which handles fiat transactions. Now, a more recent version has been created, the BitPesa system, allowing not only cash transactions, but also sending and receiving Bitcoin. Recently, BitPesa showed signs of expansion after it acquired online payment service TransferZero.
SMS Payments: An Old Trend Back in Fashion?
The unrolling of the technology has yet to see telecoms and crypto projects go for wider adoption. Everything moves fast around Bitcoin, and newcomers may forget that attempts at SMS services were present a few years ago. However, most of those services are now forgotten, and new ones may have to replace them. Services such as Bits are now inactive.
The next frontier would be recent ICOs. If we trust the plans and the roadmap for the Telcoin project, the search for partners from the world of telecoms may begin soon. But so far, experience has shown that only niche telecom companies attempt to integrate crypto payments, and only on a small scale.
Telecoms Only Test the Water
Buying crypto coins through mobile credit has seen some exploration. But so far, the offerings are very limited. CoinGate has been offering the service for months now, but has limited its outreach to several countries in the Euro Area.
However, the limitations of the service show that the connection between telecoms and the world of crypto may need more work to gain scale and outreach.
Another earlier attempt to link telecoms with the world of crypto came from Perseus Telecom, which partnered with Brock Pierce's GoCoin to offer Bitcoin payments. However, at the moment other technologies have become more influential.
Other telecoms that have been involved in the world of crypto coins include the Japanese DoCoMo, which provided early funding to Coinbase, but also the Californian branch of the Orange telecom. T-Mobile Poland has also tested Bitcoin, by selling prepaid packages, and this time, the service is still operational, handled by InPay.
More Coins Added
The BitRefill service seems to be spreading, this time targeting South Korea, one of the friendliest crypto spaces:
Bitrefill is now live in South Korea!— Bitrefill (@bitrefill) February 15, 2018
We support KT, SK and LG U+ operators for prepaid phone refills, and of course Steam and Viber vouchershttps://t.co/1LDiWbfvMf
While the first round of telecom adoption centered around Bitcoin, this time BitRefill has also expanded to assets like Litecoin or DASH.
In fact, BitRefill seems to be having a field day, as it has a widening network and a clear use case of crypto coins. The service plans to expand with an Android app, which is in the beta testing phase now. A similar service, BitMoby, at the moment spans more than 100 telecom markets, allowing for top-ups of up to $100 in value.
So far, the market for those kinds of services is limited, and BitRefill seems to be the leader. Other similar interactions between the world of crypto and telecoms include Piiko, and Mobile Shop, the Philippines service.
At this point, it is up to telecoms to recognize the opportunity and use their technological advantage to adopt fintech solutions where banks seem reluctant. The idea of interacting with telecoms may also inspire a new crop of crypto startups.