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Starbucks Clarifies Its Position on Cryptocurrency

Late last week, news went around that international coffee maker was going to get involved in Bitcoin and cryptos in general. Many saw this development as a welcome one, especially as it provided relief to the crypto community. But the coffee company has come out to clarify the rumors.

Cryptocurrency Foray Doesn’t Mean Bitcoin for Latte

American coffee company, Starbucks, has come out to debunk rumors that it was accepting Bitcoin and other cryptocurrencies as payment. Earlier in the week, the company announced Bakkt, a new global platform that will enable the spending of digital assets. This is a joint venture involving Intercontinental Exchange, BCG, and Microsoft, amongst others. According to Starbucks’ payments VP:

The company would play a pivotal role in developing practical, trusted and regulated applications for consumers to convert their digital assets into US dollars for use at Starbucks.

The announcement excited several new outlets who rolled out different headlines with the notion that Starbucks customers would soon pay for their coffees and lattes with Bitcoin. On Saturday, the company decided to set the records straight. To clarify the notion and correct the impression already created, a spokesperson for Starbucks said:

It is important to clarify that we are not accepting digital assets at Starbucks. Rather the exchange will convert digital assets like Bitcoin into US dollars, which can be used at Starbucks. Customers will not be able to pay for Frappuccinos with bitcoin.

The announcement made by Starbucks indicates a significant interest in the promising crypto industry, and retail payments will be considered. When it comes to the frequent use of its mobile app, it is beating out big names like Apple Pay and Google Pay. According to an article on Fortune:

The founding imperative for Bakkt will be to make Bitcoin a sound and secure offering for key constituents that now mostly shun it—the world’s big financial institutions. The goal is to clear the way for major money managers to offer Bitcoin mutual funds, pension funds, and ETFs, as highly regulated, mainstream investments.

Starbucks Getting Involved in Crypto

On Friday, Intercontinental Exchange (owners of the NYSE), Microsoft, BCG, and Starbucks, announced that the launch of Bakkt. The announcement came as a relief for the crypto community. The new company will push Bitcoin and other cryptos towards becoming the mainstream financial asset. The news was timely, as it came at a time when crypto markets lacked the drive to get out of the crypto bear trend.

Crypto enthusiasts believe that with Bakkt, there is hope that the CBOE sponsored Bitcoin ETF pending at the SEC might just get the go-ahead it seeks. Bakkt getting fully operational by November 2018 will give validity to Bitcoin ETF. Brian Kelly of CNBC, further explains the situation. He said:

This is huge news. I think the market is completely underappreciated. So, let us talk about why this is the biggest news of the year for Bitcoin. It paves the way for a Bitcoin ETF. Last week I stood here and said you know what, I don’t think the Bitcoin ETF will get approved. And guess what? The Winkelvoss ETF got rejected. Why? Because there was not a US regulated exchange and there wasn’t US regulated custody.

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Bitcoin (BTC) Price Analysis: Will Sellers Return Here?

Bitcoin broke higher from its short-term consolidation but is still in correction mode.

Bitcoin is still in a weak spot even as it broke to the upside of a short-term consolidation pattern. Price is currently testing the 38.2% Fibonacci retracement level on the 1-hour chart, and this lines up with a descending trend line so far this month.

Apart from that, the resistance area coincides with the 50 SMA dynamic inflection point. The 100 SMA is still below the longer-term 200 SMA to indicate that the path of least resistance is to the downside or that the selloff is more likely to resume than to reverse.

Also, the gap between the moving averages is slowly widening to reflect stronger selling pressure. The 100 SMA is just above the highest Fib, adding an extra layer of resistance in the event of a break higher.

RSI is heading higher but is dipping into overbought territory to signal exhaustion among buyers. Turning lower could bring sellers back in and lead to a slide back to the swing low or lower. Similarly stochastic is on the move up but might be ready to head back down from overbought levels soon.

Bitcoin got a bit of a lift early this week on news that South Korean exchange UPBit has been cleared after investigations. This could be a positive update that the market badly needs after erasing most of its earlier gains.

Recall that institutional interest lifted prices earlier in July but a slew of negative commentary and an outage in HitBTC forced these gains to be returned. It didn’t help that South Korean officials are reportedly looking into removing tax breaks from crypto exchanges and possibly on transactions down the line.

Reports that Starbucks isn’t really accepting bitcoin as payments for coffee also dragged on investor sentiment, although this simply came as a clarification from news that it is teaming up with ICE to launch digital platform Bakkt.

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