Bitcoin startup Bitpay was founded in 2011 when Bitcoin was heard only within a coterie of technology enthusiasts. Come 2014, the company shattered all records to secure a $30 million investment in a Series A round of financing. In February 2015, the company boasted of 60,000 merchants accepting Bitcoin.
But four months since then and the company has shifted its focus from getting more businesses to accept Bitcoin payments to selling the technology developed to big banks.
Bitpay’s Co-founder and CEO Stephen Pair told Business Insider that, “They (big banks) are very excited. What we’re building we started building because we needed to secure our own accounting system. Turns out that’s the same problem that banks face when they need to do clearing and settlement between each other.” Pair further added that, “We’re talking to quite a few banks. They’re very serious, they want to do pilot projects and they can’t start working on them fast enough.”
But why this tectonic shift?
Even though Bitpay has a huge customer base and a sturdy reputation, has Microsoft, Paypal and Virgin Galactic as its business clients, the company has been unable to witness an encouraging response from the common people.
Pair said, “We keep adding merchants — we’re up to over 60,000 now — but they’re selling to the same pool of Bitcoin early adopters.”
Why Just Banks?
In very recent times, leading banks such as UBS, Santander have expressed their interest in the Bitcoin technology. Implementation of the blockchain technology in the traditional banking system is expected to revolutionize the way we transfer money. Therefore, big banks want to get in on the game while they still can to build up to be a leader in this segment. A majority of these leading financial institutions are hoping to improvise their back-end processes utilizing the underlying Bitcoin technology while some are hoping to emerge as cheaper, faster and reliable money transmitters.
