Come On Amazon, Get Into Crypto Already

In Big Tech, Apple was usually the one who was late to the party. When it comes to crypto, that does not seem to be the case. Apple has made moves to hire an “alternatives payment” manager that we can assume involves cryptocurrency. It became obvious when one of the key qualifications mentioned was experience with cryptocurrency. Google has been involved with blockchain technology related matters like their partnership with Theta Labs network. Other Big Tech companies like Twitter, Facebook and Microsoft have dabbled with blockchain and cryptocurrency on occasion but there is one company that we have not heard much about recently being involved in crypto … Amazon.

Amazon has actually patented a blockchain-based product authenticator back in 2020. It is not using cryptocurrency (as of writing) and has not really been in the news much. Amazon even removed crypto from their payment methods from the Twitch.TV platform . There is however news that Amazon is moving towards cryptocurrency payments. Just like Apple, Amazon is looking for a digital currency and blockchain expert. They might be considering crypto payments for their online retail business.

It is a big deal if Amazon embraces crypto. Not just for payments, but if the company invests in digital assets like Tesla. Amazon has a large retail empire which they could open to retail for cryptocurrency. This will most likely require payment processors like Visa, who have started to process cryptocurrency for payments in 2021. Amazon may permit payment processors to handle cryptocurrency to fiat conversions, meaning the final payment will still be in fiat.

Developers would find it an opportunity to create gateways for payment processors from crypto to fiat. Regulations must be followed as part of jurisdiction laws, so how it will be implemented is the challenge. The less you have to deal with regulators, the better it will be to just allow others to deal with it. Then again why would Amazon need a third party, when they are more than capable of implementing a system with their vast resources available.

According to an Amazon spokesperson:

“We’re inspired by the innovation happening in the cryptocurrency space and are exploring what this could look like on Amazon. We believe the future will be built on new technologies that enable modern, fast, and inexpensive payments, and hope to bring that future to Amazon customers as soon as possible.”

It sounds like the type of news that can move the market to the upside. It is also what speculators want to hear because it can generate more interest in Bitcoin and other cryptocurrency. That usually leads to FOMO buying sprees that help drive prices of digital assets higher. While the news cycle from the media had been full of FUD the past few weeks since “Elon FUD” back in May, it has since become more positive. Whether or not Amazon does finally consider cryptocurrency payments or develop their own token, they have confirmed their interest. For many analysts that is a sign that cryptocurrency is not about to go away any time soon.

(Cover Photo Credit by Anna Shvets)

Amazon’s Blockchain-based Product Authenticator Patent And How It Can Impact Global Supply Chain Management

If you thought Amazon would never get into the blockchain, they already have. They patented a new system for supply chain management that uses a blockchain-based product authenticator. Even before that, Amazon’s AWS already provided a blockchain platform for developers, so this is not merely a PR stunt to show they are in the know. They actually “know” what they are talking about. While the actual details of the patent do not seem to be available (as of this writing), many news sources have reported that it had been approved.

What Amazon is developing has significance in modern business. They are building a system that compiles data from distributors, manufacturers and shippers using an “open framework”. This gathers real time information from what would otherwise be silos of data. It interconnects those involved in the supply chain with a trusted platform using a distributed ledger for accountability and transparency. That is a way for tracking the authenticity of products as they are packaged and shipped to retail.

One of the things this system can do is prevent counterfeiting and product theft. There is a huge black market from stolen luxury goods and another problem is that there are fake products being sold around the world that is cutting into the brand’s profit margins. This also affects consumers who are not purchasing genuine products, but fake rip-offs that have no value. Many just buy the fake items because of status. The harm it causes though is not apparent, but does affect the brands whose name is being counterfeited in these fake products. A real genuine luxury handbag like that from Gucci come with authenticity certificates or labels, while counterfeit products do not. Products can be tracked using its GTIN (Global Trade Item Number) which is a code that verifies a genuine product from its source.

A blockchain provides a way to track the products in the supply chain and earn trust among suppliers and distributors with more transparency. That is a way to make sure that no hidden party is involved in the process, since it is being recorded on a distributed ledger which others involved in the process can view. If there are any anomalies, it can be detected and corrected. For example, if the products suddenly change distributors, it can be red flag to the supplier. The blockchain records that and can notify the supplier if and when it happens. With legal agreements enforced, this can then be disputed by the supplier.

Now that Amazon’s plans are clear, will it affect the current ecosystem of projects that are doing the same thing? Amazon is known to kill off startup businesses who cannot compete with the retail and tech giant. Amazon has its own platform and infrastructure to remain dominant. This could open the market to more competition with Amazon, as other companies propose their own solutions. IBM and Deloitte are just some of the companies that have already been involved in exploring blockchain-based solutions for supply chains. Even Amazon retail rival Alibaba has championed the use of blockchain systems. Numerous other tech companies, like Facebook (Libra digital payments) and Microsoft (New patent for cryptocurrency) have started their blockchain projects for other types of applications.

According to Deloitte:

“Using blockchain in the supply chain can help participants record price, date, location, quality, certification, and other relevant information to more effectively manage the supply chain.”

IBM has stated:

“Supply chain data is not always visible, available or trusted. IBM Blockchain helps supply chain partners share trusted data through permissioned blockchain solutions.”

Alibaba has numerous blockchain patents. According to an article from Smartereum:

“The Chinese giant will rather pioneer efforts in the blockchain space than lose out on early gains of blockchain adoption. So far, it has adopted blockchain to fight food fraud, secure medical data and track cross-border shipments.”

Amazon’s entry into the market shows that big business is taking blockchain seriously as a solution to real world problems rather than merely a novel technology. Patents are still just on paper, and not actual products. Once they get their product to market and it proves effective, Amazon’s patent could gain industry adoption as a standard for supply chain management.