Samsung enters cryptocurrency space, will Apple follow?
Ever since Apple reshaped the computing market by ushering in the smartphone era, tech companies have been on the lookout for the next big thing. While the ever-vibrant technology sector has always been driven by innovation, in the past, market leaders were often inclined to underestimate emerging trends, feeling confident that their businesses are strong enough to handle possible market shifts. The 2007 launch of the original iPhone completely shattered this false sense of security.
Smartphones Late to the Crypto party
The smartphone era is riddled with cautionary tales of how ignoring emerging trends can have severe consequences in the tech sector. The failure to recognise the upcoming paradigm shift caused many of the phone giants of the pre-smarphone era, such as Nokia and Motorola trying to catch the market leaders. Having also missed the smartphone trend, Microsoft had to catch up for a number of years, despite the usually robust financial performance of its core software business. It took a change at the helm of the company and a complete reinvention of its business model, for the software giant to return to relevance in the ‘post-PC’ era.
The rise of smartphones ensured many years of unparalleled success for early movers into the space, such as Apple, Samsung and Google. But with more and more players emerging on the scene with their own smartphone offerings, the market has been driven to the point of saturation. Thus, the search for the next big trend has begun. And this effort is at least partly focused on a bold new frontier – the blockchain.
Mobile Phone companies explore Cryptocurrency and Blockchain
After several weeks of speculation, Samsung Electronics last month unveiled a cryptocurrency wallet app for its new flagship phone, Samsung Galaxy S10. The app, which can be downloaded from the Samsung Galaxy Store, currently supports Ether (ETH) and ERC-20 tokens, but the South Korean giant has stated that it wants to add support for more cryptocurrencies in the future. In addition, the wallet also supports four decentralised apps (dApps): a crypto gaming platform called Enjin; the beauty-focused dApp Cosmee; CryptoKitties and merchant payments service CoinDuck.
The S10 also features a secure storage solution for cryptocurrency private keys called Blockchain Keystore.
Other smartphone manufacturers have also taken steps to create cryptocurrency-friendly products. One of the first attempts to create a handset designed around the blockchain actually came from a star-up called Sirin Labs. Last November, the company launched its first product, the Finney handset. Powered by an Android-based operating system called SirinOS, the ‘blockchain phone’ features a built-in cold storage wallet, dApps support and a token conversion service, among other functions.
Samsung’s Taiwanese rival HTC has also taken a stab at building a blockchain phone. Unveiled last October, the Exodus 1 comes with its own cryptocurrency wallet called Zion that makes the phone function as a hardware digital currency wallet that can also store private keys. In an interview with CNBC, HTC’s decentralised chief officer Phil Chen, said that the company’s main motivation for building the phone was to improve user privacy.
“And the reason why you do a blockchain phone is … for everybody just to own their own keys. Everything starts there. When you start owning your own keys, then you can start owning your own digital identity, then you can start to own data,” Chen said.
Social Media Giants show interest in Crypto Payments
Social media companies have also been looking for ways to utilise blockchain technology. Bloomberg reported in February that Facebook was developing its own stablecoin – a cryptocoin, whose price is pegged to a fiat currency such as the US dollar – to enable users to transfer money on its WhatsApp messaging app. According to the report, the initial focus of this payment option will be India’s remittance market. The newswire also noted that Facebook had been hiring blockchain specialists, as part of its effort to bolster its blockchain unit.
Twitter is another social media company that could enter the cryptocurrency market. While the microblogging platform has not hinted at having such aspirations, Jack Dorsey’s other company, Square, added Bitcoin buying and selling option to its Cash app in November 2017. Dorsey, himself, is a vocal supporter of Bitcoin and has even stated his belief that BTC would one day become the Internet’s native cryptocurrency. He recently participated in the Lightning Torch challenge and praised Tippin.me, a tool that allows people to send tips via the Lightning Network.
Where is Apple in Crypto Market
It’s ironic that the company that has for so long been synonymous with bold innovation has been behing in the crypto race. With iPhone responsible for the bulk of Apple’s revenue and profits, the company needs to find new revenue streams, in order to reduce its reliance on smartphone sales. Yet, Apple has so far been unable to come up with a worthy successor to the mighty iPhone.
The company has tried to counter by sharpening it focus on web services. Given its new approach, it’s easy to assume that the company would be paying increased attention on emerging technologies in that space, including blockchain. However, at the moment, the company’s interest in the distributed ledger appear to be limited. As for cryptocurrencies, Apple currently tolerates cryptocurrency-related apps on its store, as long as they abide by the platform’s rules. However, the Cupertino-based tech giant hasn’t indicated that it intends to enter the cryptocurrency space.
It’s worth noting that if Apple decides to move into crypto, it has the perfect vehicle to do so. Its Apple Pay platform already facilitates cashless payments in physical stores and online, while Apple Pay Cash allows people to transfer funds via messages. Given that Square and Facebook are already moving in a similar direction, this seems like a strategy worth pursuing.
Crypto Market Prime for Mobile Phone Companies
Driven by the need for constant financial growth and the fear of missing out on major trends, tech companies have been pushing the industry in new and interesting directions, trying to create new product categories and new markets. The tablet was once viewed as the next smartphone, as was later the smartwatch, but both have come short of becoming truly blockbuster products.
Some pursuits have been more worthwhile than others. Advancements in cloud computing, big data and artificial intelligence have been shaping the digital economy of the future for years. Now blockchain has the potential to become an integral part of that space and tech majors are starting to recognise that.