Since the beginning of 2019, the Bitcoin-powered payments app plague aims to be a global crypto-powered equivalent of Venmo or Cash App. On Friday, the company—led by 29-year-old businessman Jack Mallers—announced that it is expanding to a total of 65 markets in the world, in addition to the US, El Salvador, and Argentina, where it already operates.
In an interview with luck in Miami, Mallers prefers Strike’s consumer-facing app, which offers Bitcoin and Tether transfers, through what he describes as “frictionless onboarding.”
“We think there are billions of people who want a money app with features and capabilities that stand out in a clouded world of crypto exchanges and hidden, unregistered licensing regimes and 1,000 which are different coins,” he said.
At a time when the US crypto industry faces regulatory uncertainty, and as the Securities and Exchange Commission prosecutes companies for offering unregistered securities, Mallers said this is a validate with Strike’s Bitcoin-first method.
“I think Bitcoin stands alone, and how obviously it’s owned by anybody,” Mallers said. luck. “Every other instrument in this industry has a founding team, a foundation, and they issue some [tokens] are private and given to auctions before they go live—and this seems like a security.
SEC Chair Gary Gensler has publicly stated that he views Bitcoin as a commodity not a security.
Mallers said that Strike has taken a regulation-first approach in the US, including in New York, where Strike is currently not available but is in the process of applying for a so-called BitLicense.
Mallers added that Strike’s expansion into other global markets happened in part due to the relocation of its global headquarters to El Salvador, which passed a digital assets law earlier this year that established a regulatory framework. for crypto. According to Mallers, Strike received one of the first licenses under the new regime, along with Bitfinex.
Mallers has ties to El Salvador and its president, Nayib Bukele, who established Bitcoin as legal tender in 2021. Mallers introduced Bukele at the Bitcoin Miami conference in 2021, where the president made the announcement via video.
Although Strike was initially tapped to help develop the Bitcoin experiment in El Salvador, it later withdrew from the project, suffering early bugs and slow adoption.
However reports that businesses and residents in El Salvador are not using Bitcoin, Mallers cited other metrics, such as the increase in tourism. “I think that El Salvador has found hope in Bitcoin,” he said, arguing that the adoption of entrepreneurs “is not the reason for success.”
The next challenge for Strike is to expand its relationship with banking services that allow customers to exchange Bitcoin for fiat currency. For now, customers of the new Strike markets can only receive Bitcoin from other users, although Mallers said he aims to launch new features, including a debit card, in later this year. Another challenge comes in the form of network congestion and higher fees on Bitcoin transactions due to the recent demand for new products such as ordinals and BRC-20 tokens. Mallers argued that “Bitcoin is working as intended.”
“The claims that [congestion] hurts the third world, and it invalidates how developing markets use this technology which is ridiculous,” he said.
Mallers also pointed to another feature of Strike—Send Globally—which allows users to transfer between USD and other Strike currencies using Bitcoin as an intermediary, although it is limited to twelve countries in Africa, Central America , and Southeast Asia.
Currently, Strike’s dollar balances are held in Tether, a dollar-pegged stablecoin that has attracted criticism for its shady accounting. Mallers said the company decided to go with Tether, as opposed to other options like Circle and Coinbase’s USD Coin, due to demand from users in the Global South.
“They don’t trust the Circle,” he said. “If I’m being completely honest, the Circle was built for American institutions.”
While proponents make the case that the Lightning network can truly transform Bitcoin into a payment service, the expansion of Strike represents the first attempt to build an app that allows people around the world to to transact with each other.
Mike Brock is the CEO of TBD, a Bitcoin-focused division of Jack Dorsey’s financial technology company Block. Although Block plans a global expansion for its payment platform Cash App, Brock supports Strike’s effort.
“If your mission is to develop any decentralized ecosystem, then you better hope that there is actually a fairly competitive market of different companies competing for solutions in that system, ” he said. Good luck.
Two years after Mallers introduced Bukele to Bitcoin Miami, he reflected on the changing circumstances, wearing a hat emblazoned with the flag of El Salvador.
“Two years ago, people would make fun of me [for our] headquarters in El Salvador to launch a product for three billion people, but now Coinbase fought with Gary Gensler,” he said. “Who’s laughing now?”