Post image for Fake Out – You Can’t Put Your Card in that EMV Slot

Visa’s CEO recently reported that more than 750,000 locations, representing 17% of the U.S. face-to-face card-accepting merchant base, are accepting EMV chip cards. While everyone in the industry agrees that it will be quite a while before the numbers reach “critical mass” (whatever that means to you), there are two key questions for today. The first is pretty easy to answer; the second, perhaps, not so much:

  1. Why haven’t more merchants installed EMV-capable devices?
  2. Why are there so many EMV-capable devices already installed that have not been enabled to actually accept chip cards?

The first question has been discussed more extensively and the answer is a combination of factors:

  • Almost every new terminal deployed these days is EMV-enabled, but the millions and millions of terminals at “mom and pop merchants” have a very long useful life – 7 years gets quoted quite often. Why incur the expense and hassle of upgrading when you are highly unlikely to ever see a counterfeit card? I don’t think the local dry cleaner, daycare center, or dog groomer is particularly worried. Having said that, Glenbrook has had many conversations with our larger merchant clients who have chosen to implement EMV because they are worried their customers might think they don’t take security seriously. Reasonable people can disagree whether their customers will even notice or care (with the likely exception of Target customers), but one can certainly respect the position of these merchants.
  • ISOs and acquirers have only recently been out there in force, trying to get their installed base of merchant terminals upgraded. But the timing has been off. Smaller merchants who had never heard of EMV didn’t quite get the message until September, a month before the liability shift, or when they received chip cards of their own. By then, there were reports of terminal shortages (since resolved).

Fair enough.  But what about my second question?  Why do I encounter so many terminals that have the EMV hardware installed (pretty much anything deployed in the last few years) but have not yet been enabled to accept chip transactions?  You don’t have to look too hard to find them – they’re at McDonald’s, Safeway, and a slew of other merchants huge and small.  Why are they not performing EMV transactions? There are a number of reasons:

  • Make Someone Else the Trainer. Some merchants, particularly the large ones, don’t want to “educate America” on how to perform an EMV transaction. This was especially acute during the holiday season. They see EMV as just slowing down lines and chose to wait until consumers learned what to do—and do it quickly—at someone else’s store.
  • Big Effort. EMV deployment is a big project for large merchants. POS systems need to be modified and often upgraded and always certified (no small nor quick task). Clerks have to be trained. These POS change projects usually span years, not months. Many pieces to the EMV puzzle, particularly regarding debit, were not in place in time for the liability shift deadline.
  • Hurry Up and Wait. Many, many, many integrated POS systems (IPOS), especially the electronic cash register software for these systems, were just not ready in time. Even if the software was ahead of the game, they faced long certification queues at many acquirers. I believe this is going to be a problem for a while.
  • Waiting Tables. Restaurants pose unique challenges. There are staggering numbers of large and small restaurants with terminals capable of taking chip cards, but unfortunately, the software is way behind, often due to the added work needed to deal with tips and tip adjustments. Many in the industry believe the POS software firms serving the restaurant industry simply underestimated the time and effort required to accommodate EMV. These are many of the same companies, mind you, that already support EMV in Europe and beyond. And of course, once complete, each still needs to be certified by a plethora of acquirers. And that takes time as one of our huge national restaurant chain clients knows. They won’t have an EMV-enabled solution ready until late 2016.

I think it’s interesting to talk to fellow payment geeks who simply shrug their shoulders and say “whatever, who cares about cards? we’ll all be using our phones to pay soon enough.”

I’m definitely not in that camp, but some of my colleagues at Glenbrook do joke that if you really want to make contactless look good, make the alternatives look worse. I think we’ll all get used to dipping and waiting at the POS, but the truth in that humor points directly at the spread of contactless in Canada and the UK.

Let me know your thoughts!


Post image for Bitcoin 3.0 – Permissioned Blockchains

Blockchain. Is it the most revolutionary technology in value exchange ever or just the latest fintech buzzword enjoying its peak on the hype cycle? Or both? These young techniques are undergoing swift evolution, going from bitcoin and money transfer into new use cases such as identity management.

There’s still truth in the cartoon’s joke that, online, no one knows you’re a dog. The challenge goes beyond discerning hacker activity from the permitted. It’s also about the release of just the data necessary to satisfy the needs of both parties in a transaction – and no more. How much better that would be than sharing a full suite of personally identifiable information when simply asking the question “are you over 21?”

Take a listen to my discussion with Matthew Commons, CEO, of Cambridge Blockchain on how his company’s blockchain-based approach can be used to address one of the internet’s remaining fundamental concerns. You’ll also learn about the state of play in this new stage of permissioned blockchains.


[click to continue…]


Post image for Election cycles and payments systems development

It’s election time here in the United States and potentially big changes are ahead. Elections define the beginning and end of political eras.  Walter Dean Burnham, the distinguished professor of American Politics, elaborated a theory of party change and realignment.[1] Burnham’s theory noted that critical issues bubble up from time to time and their impact is significant enough that business as usual in politics is changed.

Relax, everyone, I’ve not turned into a political blogger nor am I proposing a theory of payment system change in the U.S. or elsewhere. But I would like to offer some thoughts on two key trends that are bubbling up that may indeed affect payments as usual:

Payment System Visioning & Coordination

More and more countries and regions are devoting time and resources to defining an ideal state for their payment systems.  This is not new. Countries which have higher levels of central bank planning and payment system involvement have traditionally elaborated 3-5 years plans. The Reserve Bank of India, for example, develops a payments vision document every three years. Now others are getting on board:

  • The Canadian Payments Association is spearheading a national conversation on payments system modernization in the hopes of reaching consensus on changes to existing systems and what additional systems or functionality are needed
  • The Federal Reserve’s Faster Payments Task Force is a forum for industry dialogue on how to achieve faster payments, more secure payments, increasingly electronic payments, better cross-border payment options, through participatory input to payment system development
  • Launched in 2002, the European Payments Council is an elaborate and on-going initiative to develop and improve payments options for the Euro area

Payment System Speed

Deferred payments like traditional ACH and check are receding further into the background of these conversations. Their main focus is centered on the development of cheaper, real time options for retail payments.  Countries which already have real time payment projects underway include:

  • The Kenya Bankers Association will launch a real time interbank switch in 2016.
  • Banks in Australia will launch the New Payments Platform in 2017 that promises “faster, more flexible, data-rich payments”
  • The clearing arm of the Euro Banking Association is planning to launch a pan European instant payments infrastructure in 2017
  • The bank-owned collaborative called The Clearing House is developing a real time payments rail here in the U.S., in part based on the VocaLink technology behind both the U.K.’s Faster Payments and Singapore’s FAST systems.
  • And, while not in the real time category but certainly at a faster pace, we also see countries like the U.S. (2016) and Peru (2015) implementing same day settlement of ACH payments

Globally, we are moving into a new era of improved payment options. Of course, the past decade has been a period of tremendous payments system innovation that extends well beyond this short trend list. However, many of those innovations were technologies or techniques that solved particular problems for the particular clients of a specific company.  Examples include the proliferation of faster payment solutions that use debit rails to transfer funds between individuals and businesses. Another example would be the practice of using contractual arrangements and rule sets to create the effect of real time payments without actually having a real time payment system.

We don’t yet know how the landscape will be redefined. New payment rails like the one being built by The Clearing House will certainly initiate a defining period of payment change in the U.S. Of course, this is not to say that each payment system improvement solves all problems but they do, over time, tend to enhance the overall system and create opportunities for innovation and performance.

Just as in politics, new challenges and needs continue to rise into the collective consciousness of the payments industry. This is the really, really exciting part: to think about the potential of these new systems and how they will improve payment options for consumers, business and governments. And then there will be the work of building the future’s nextgen systems!

You surely have noticed that I did not include Bitcoin, other virtual currencies, or ledger based payments processing. This omission was intentional. We’d love to hear from you how these new technologies will influence payments as usual.

[1] If you’re interested, check out Walter Dean Burnham’s book Critical Elections and the Mainsprings of American Politics (1970).


Post image for Really Big Questions in Payments

Glenbrook’s Allen Weinberg wrote a few weeks ago about his view of the Grand Challenges in payments…. a daunting list, and one I agree with.  But I want to extend his discussion on one of his challenges:  “Realigned value chain economics in a push payment world”, and add two more: “What is the proper role for government in the issuance of money?” and “Who owns the payment address?”

Warning – these are just questions – not answers!

The Economics of Credit Push

The credit and debit card industries, as they evolved, created a number of new businesses – one of which derives from the merchant discount fee (MDF) revenue which card acquirers, and their partners, receive.  This business was a fairly radical departure from the past: merchants previously simply deposited checks and cash into their bank accounts, paying perhaps a deposit fee but nothing like a merchant discount fee.

Now, this is a complicated subject, and you may think I’m talking about interchange – but I’m not.  Interchange, of course, is a part of the MDF which is passed on to the issuer, to cover various of the issuer’s costs.  This is a tendentious subject in countries around the world.  Although I think one can make a case that debit interchange is on a trajectory to zero, that’s not my point here, or what I’m asking you to think about.  Consider instead the rest of the MDF: the money that the merchant’s acquirer and their partners keep.  Why does that exist, when no comparable amount exists in a straight deposit scenario? Here’s my take – (which I have written about before):

The rationale for the acquirer’s portion of the MDF was sound:  significant new costs needed to be covered.  These included the merchant-side cost of managing (asking for, receiving) the good-funds authorization; the cost of the merchant-good-behavior guaranty; and the costs of supporting the hardware and connectivity requirements for online payments.   In exchange, the merchant received all of the manifold benefits of electronic payments.  A good deal – not at any price, but clearly value to the merchant for which they were willing to pay.

But the new world of credit push payments looks very different.  This is unfolding in two variations around the world.  Developed nations are introducing new, or enhancing old, ACH-type systems for real-time “push” payments.  Developing nations are introducing various forms of mobile money wallets – also capable of doing real-time “push” payments.  These look a lot more like a direct deposit of payroll transaction than they do a card transaction.  The costs mentioned above are more or less gone: there is no need for a good funds authorization; the rules are generally written so that the receiving bank (or financial services provider) is not making any behavior guarantees to the sending bank; and the hardware and connectivity is probably a phone and the internet.

These credit push systems are being introduced for P2P, B2B and bill pay use cases, and not, generally speaking, for merchant payments.  But it is inevitable that they will expand into this: we see this with the introduction of “Pay By Bank” in the U.K., and by products such as Kopo Kopo in Kenya.  Many people assume that a commercial business model similar to that used for cards will prevail – but will it?  Does that make sense?  Or will it look more like a simple deposit into a merchant account?

There is, of course, one important additional source of cost in these payments – the need on the part of both the sending bank and the receiving bank to perform AML compliance.  This is complex because both the risks are new (what exactly are bad guys going to do with these new capabilities?) and because the regulatory environment around them is not yet settled.  But banks will need to price their costs in managing this – both to the sending party and to the receiving party.  Where merchants are the receiving party, they will need to pay some of this.  What is not clear is if card-like interchange will exist on these systems which will entail a merchant’s bank compensating a consumer’s bank for some portion of the consumer’s bank’s costs.  There is no such interchange in the U.K.’s Faster Payment system, although (as I understand it) the “Pay By Bank” merchant payment service offered on top of this will have a component of merchant revenue shared back to the consumer’s bank.

One final thought on this question.  A simple, direct, party-to-party electronic message.  That’s what we’re talking about, right?  Think about email – and the cost of email to the end-users.  That may be the way we are heading.

Government and Money Issuance

“Issuance” is a funny word.  We use it in the card industry – to mean the entity (usually a bank) which issues a card to a consumer – but we hardly think of it as the issuance of money.  A debit card bank, instead, has a deposit liability to the customer – representing money in the bank that has been issued by the central bank of the country.  (A credit card issuer has a willingness to extent credit; again, not an issuance of money.)  But in the developing world, so-called “mobile money” is created when, typically, an MNO accepts a cash deposit at an agent and creates an electronic balance for the depositing customer. The MNO is deemed to have “issued” the mobile money (sometimes called “eMoney”).  What’s really the difference?  Not much.  The MNO has created a liability, just like the debit card bank did.  The balance at the bank is backed by the bank’s cash on hand, and, usually, guarantees of the government.  The balance at the MNO is backed by a deposit the MNO has made at a bank.

So why do I bring this up?  I’m fascinated by the discussions around the idea of central banks issuing virtual currency – using some variation of the blockchain schemes that abound.

Let’s think about cash for a moment.  The government is the issuer – the creator – of cash.  The government bears the expense of creating the cash, and, along with the banks in the country, the cost of distributing, collecting, and safeguarding cash[1]. The government, of course, also has a strong interest in its role as issuer of money because of its interest in controlling the monetary supply and through this controlling some aspects of the economy.

Although merchants and consumers undoubtedly incur costs in the use of cash, many people, and many small merchants, perceive that the use of cash is free to them.  So thought of this way, cash is a national utility – perhaps what economists call a “public good” – provided by the government to its citizens.

Within the payments industry, we’ve been focused on replacing cash with electronic payments for a long time.  There are very good reasons to do this, which I don’t need to elaborate on here. But does it necessarily follow that what had been a government function (issuing cash) suddenly becomes a commercial function (enabling electronic payments)?  Why doesn’t the government start issuing “eMoney” – perhaps in virtual (blockchain-like) form?  And can this be done with some of the attributes of cash today – so that it’s use is essentially free to consumers?  If the government issues “eMoney” – how are banks involved?  Are they even necessary?

It will be fascinating to watch.

Payments Addresses

How will you address a payment you send to someone (or some business)? A simple question, one would think.  But there are myriad options.  First of all, let’s clear the air about the differences (yes, yet again) between “pull” and “push” payments.  In a “pull” payment (like a card transaction, or a check), the payer has to give the payee their account number (or a token to it) – so the payee can send this data through the value chain and accomplish the “pull”.  That’s what a check number or a card account number does – you give it to a merchant, the merchant gives the number to their bank, who uses it to pull money out of your account.   By the way, very bad things can happen when that number is stolen – hence the move to tokenization in the card world.

But in a “push” world, the reverse is true.  The payee has to give the payer some kind of account information, so that the payer’s bank (or institution) can send it to the correct place.  It’s an addressing issue, like a physical street address, a URL, or a phone number.  Generally speaking, the bad things that can happen with a “pull” account number can’t happen with a “push” address.[2]

So “push” addresses aren’t secret – they should be freely and easily given to anyone you want payment from.  It makes a lot of sense that they be something that is easy to remember – some commonly known item (phone number, email address) or some easy-to-remember-and-use code.  A good example of this is the BPAY code used in Australian bill payments.  More recently, in the U.S., Square has introduced this with their “$Cashtag” concept and PayPal with “PayPal.Me”.

But in the United States, we are looking at a universe where in all probability there will be multiple credit-push payments networks: Square and PayPal and The Clearing House and Visa and FIS Paynet, etc.  Will each network use its own addressing system?  How inconvenient will that be for payers and payees to remember and manage? Or might these competing networks agree to collaborate on a common naming protocol – and the underlying directory/discovery/routing infrastructure that can support network interoperability?

If there is a common protocol, who will “own” that?  Is that a government function, like ZIP codes?  A non-profit organization with that as it’s purpose, like ICANN? A banking industry association, like the ABA and bank account routing codes?  Or will each network persist in “owning” its own naming scheme, putting the burden of managing the inefficiencies of this on its own customers?  That sounds crazy, but remember each network is hoping that it will be come the network, and control of the naming scheme may help with that….

Important discussions along these lines are currently going on in the U.S. payments industry – but it is far from clear that common sense will prevail.  I’ve been advocating for a concept I call “PayCodes” – let me know if you want to know more about that!

So that’s my list of the biggest questions facing our industry.  Comments welcome!

[1] The government’s costs in doing this are to some extent offset by the mysterious phenomenon of seignorage.

[2] Unless that “push” address can also be used to “pull” payments – like a bank account number.


Post image for Networks Put Their Money on Checkout for Mobile

Anyone even vaguely conscious during Sunday afternoon football games has seen adverts for Visa Checkout, that shopping cart checkout assistant the card network is encouraging everyone—cardholders, issuers, and merchants—to adopt. Visa is not alone. MasterCard’s MasterPass and American Express Checkout are similar product offerings all meant to add convenience and security to the merchant’s checkout flow.

These checkout assistants—you could even stretch the definition a bit and think of them as wallets—use the payment tokenization specification from EMVCo. But as products from competitive networks, each has unique attributes, never mind its own APIs specification.

Glenbrook’s Russ Jones takes us for a pretty deep dive into how these tools work. And the benefits they provide to merchants especially in mobile commerce. Russ has been under the hood and this is a report on what he’s found.


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Post image for Enough with the 2016 Predictions – Let’s Think Bigger!

As I was slogging through the many payments-related articles and blog posts reminiscing about 2015 events and making predictions for what may or may not be ahead in 2016, I thought of a conversation I had with Scott Loftesness around 20 years ago, sometime in 1995 or 1996. Both of us were at First Data Merchant Services, then headquartered in Palo Alto, standing near his door discussing what we thought were the “grand challenges in payments” (what I affectionately called “The Holy Grails of Payments”).

Grand Challenges in Payments

There were two that I actually remember (a grand challenge in itself given how long ago that was). One was “anyone can be a merchant.” The other I remember was something along the lines of capturing SKU-level data with each transaction.

PayPal, of course, solved the ecommerce version of the “anyone can be a merchant” problem only a few years later (I don’t have a merchant account but you can still buy a poem about my dog using your credit or debit card via PayPal). Square, and many others behind it, enabled every hot dog cart, pool cleaner and dog walker to accept cards cost-effectively and with relatively minimal effort.

Regarding getting SKU-level data with a consumer payment transaction, retailers with private label cards have been able to do that that for ages, but those transactions remain only a small part of the overall payment mix (a situation that may noticeably change with the advent of payment-enabled merchant apps). Issuers, acquirers, and the payment networks have been chasing this Holy Grail for decades, but, having said that, merchants jealously guard this data, leaving others to try and get a feel for consumers’ behavior based on merchant category codes. That may be good enough for restaurant purchases, but it’s impossible to know whether I bought aspirin or motor oil at Walgreens.

Over the holidays, a few of my partners here at Glenbrook and I found ourselves thinking about the next set of “Grand Challenges in Payments”.

Security Built-In

cardsecAt the very top of my list is one that I’m sure will resonate with a large number of you – that merchants and many others in the payments value chain never have to even think about security anymore and certainly never utter that four letter word “PCI-DSS”. Instead, payment security will be built in at the issuer, network, and other parts of the payments value chain. Envision a world where merchants are never again even presented “radioactive payment credentials” from their customers at physical POS or in remote commerce transactions (that’s part of the fun we at Glenbrook have when we work on payment systems in developing countries – we get to design systems without the huge burden of a large installed base).

… with the added bonus of fixing recurring transactions

And while we’re on the subject of tokens, I know most, if not all, of our recurring payments clients dream of an overhauled or replacement for the broken card account updater service through the use of ubiquitous token-based solutions.

Truly Global Acquiring

We are always having emotional discussions with our merchant clients regarding global acquiring. Still essentially reserved for airlines and other T&E segments, virtually all of our global retail and ecommerce merchants want to minimize the number of relationships and systems they have to maintain. They want as few relationships as feasible in order to benefit from scale pricing, consolidated and consistent reporting and globalreconciliation processes, etc. Of course there are many acquirers that offer multi-national services, but our clients regularly report trade-offs in issuer approval rates, amongst other challenges.

Finally Fix Cross-Border Payments

One of the other Grand Challenges in payments is dramatically improving cross border money movement. In general, the current systems are in dire need of simplification, certainty, efficiency, and speed — think about how long a cross-border wire transfer can take, and forget about trying to figure out where the money is at any point in time as it hops from one correspondent bank to another (and when you add in weekends and national holidays in several different countries, you’re really pulling your hair out). As we’ve said before, there’s no such thing as an international wire.

Reduce Waste

gogreenAnd how about the challenge of giving Mother Earth a break from our antiquated payments systems? We at Glenbrook as well as the rest of the world would love to see eco-friendly consumer payments – eliminate hundreds and hundreds of millions cards getting dumped into our landfills every single year, not to mention how many forests we wipe out for paper receipts thrown in the trash as customers are walking out the store. Indeed, those shiny thermal paper receipts probably shouldn’t be recycled because they contain BPA. (thankfully some progressive merchants have starting asking if their customers want a copy of the receipt). Finally, let’s not forget the high electrical consumption and environmental cost of the Bitcoin mining process.

Realigned Value Chain Economics in a Push Payment World

chainAnother is the figuring out the economics of push payments. Push payments solve a lot of problems in a number of use cases, not the least of which is reducing risk and associated costs (lower losses, less complex authorization systems/processes, etc.). Push payments can, and will likely, be quite disruptive, but pricing and economics that make sense for all participants in the value chain will be quite challenging. As transactionvolume shifts to push payment rails, the risk premium disappears (you can’t send it if you haven’t got it) and those that have enjoyed sizable payments revenue via the assumption of risk will have to find new means to add value to merchants. Perhaps we’ll finally see a wave of deep accounting integrations for businesses large and small?

Payments Disappear

The last Grand Challenge I’m thinking of involves more “invisible payments”. When we ask our Glenbrook Payment Boot Camp attendees about their favorite payment experiences, they invariably mention Uber (a truly invisible payment transaction) and often mention Amazon’s low friction One Click Checkout. One of my partners’ favorite payment experiences is paying his tolls at 60 MPH driving under the wire on the highway. While there is a lot of attention being paid of late on reducing payments friction, we’ve barely scratched the surface.

I’d love to hear what you, my fellow payment professionals, view as our “Grand Challenges” – please feel free to add a comment or email me directly at



2015 has been an exciting, tumultuous year for payments. Our once “under the radar” industry now makes for daily headline news with stories and commentary (some breathtakingly uninformed) on new ways to pay, M&A activity, regulatory actions, competitive dynamics, security, and its future evolution.

In consumer payments alone, 2015 was the year that things finally got real. Things like EMV with chip cards finally issued at scale. Merchants not only acquired new EMV capable terminals but some even turned on EMV acceptance. Some, fewer still, turned on contactless acceptance to pick up the growing, but still small, base of Apple Pay, Android Pay and Samsung Pay users.

Don’t expect payments to be less newsworthy or less complicated in 2016. Consumers are being offered new payment apps by retailers, tech firms, and financial institutions. We can only guess at how many “Pay” programs will show up in the new year. Competitive pressures and investment priorities may further shift the makeup of the industry. What’s to stop further consolidation along the lines of Global’s acquisition of Heartland Payments Systems?

Thank You!

Before letting go of 2015, some words of thanks to all of you who read Payments News, Payments Views, and listen to our Payments on Fire podcasts and a special shout out to our many clients and friends across the industry and around the world. To all of you, our very best wishes for 2016. We’re looking forward to speaking, debating, planning, and working with you in the New Year!

Payments View eBook

As a way to say goodbye to this Big Year for payments, and to reflect on the fact that Glenbrook has a lot to say on payments, we’ve assembled this year’s Payments Views posts and Payments on Fire podcasts into eBook format.

There are two versions, one in Apple iBook format, the other in Kindle mobi format. Just download the version you’re interested in.

To read the eBook:

For iPad users, click on the link, and select “Open in iBooks”. The eBook will open and be added to your iBooks collection. Very similar for Mac users, just make sure you have the iBooks app.

To get the file to your Kindle e-reader, if you have a good WiFi connection for it, email is pretty simple. Download the file to your PC or Mac and then email it to your Kindle email address. It’ll show up in your Docs within a few minutes. Here’s a set of instructions.

Or you could just read it using the Kindle app on your computer. Download the file, right click on it in your Finder or Windows file manager, and open it with the Kindle reader application.


Post image for Merchants Go on Offense in Digital Payments

The evolution of the digital wallet has seemed to accelerate in recent months, weeks and days, led, in my mind, by some important payment product launches by the retail community. These developments combine the long-standing heft and influence of America’s largest retailers with a seemingly more aggressive stance by these companies to both assert their primacy in the customer relationship (which they share with banks and other payment services providers) and their critical role as the fee-paying customer in the retail payments ecosystem. Given the overarching importance of the mobile data network in transforming all businesses, it is not surprising to see these dynamics playing out in the form of digital wallets.

Four major, recent developments stand out as proof points for a shifting competitive frame in which mega-retailers push for deeper customer relationships and more advantageous payment economics:

  1. Costco’s New Co-brand Deal. In March, Costco concluded a bidding process that combines a co-branded credit card program and an exclusive acceptance arrangement with a major international card brand. After several years of partnership with American Express, Costco announced that it would move its co-branded issuing to Citibank in partnership with Visa, who will serve as the co-brand network and exclusive acceptance network for credit cards at Costco. While Costco has long employed this unique and aggressive payments acceptance strategy, this routine re-negotiation of an expiring contract will reportedly reduce Costco’s interchange expenses by one-third and allow the discount retailer to express these savings across a Visa cardholder base that is more than ten times that of American Express. While not technically tied to a digital wallet, one could imagine that Costco has plans in that realm and that its new Citibank Visa co-brand cards would logically play an important role in it. We presume the new Citibank Visa card will maintain a reward structure similar to the current American Express product, through which consumers earn attractive cash-back rewards for their spending in the form of certificates that can be redeemed at Costco.
  2. Chase Pay and MCX. November’s Money 2020 conference brought the debut of Chase Pay, a digital wallet variation of the ChaseNet closed loop arrangement struck by JPMorgan Chase and Visa last year. Chase Pay is a QR code-based payment method in which Chase card transactions are routed directly from a participating retailer’s POS to Chase directly, bypassing the retailer’s acquiring processor and the card network in the process. Under this direct switching model, Chase agrees to charge no network fees or merchant processing fees to the retailer, and protects the retailer from fraud liability. Importantly, Chase announced that, by using Chase Pay, it will be possible to install Chase credit and debit cards in the CurrentC wallet being deployed by the vast MCX retailer consortium. This news was surprising in that MCX had been seeking to control payment acceptance costs through the use of ACH transactions and private label and co-brand cards. While not disclosed, it seems likely that Chase offered an interchange concession (in addition to the benefits enumerated above) in order to gain placement in MCX’s wallet.
  3. Amazon Store Card. While still relatively quiet in the market, Amazon introduced its private label Amazon Store Card in cooperation with Synchrony last spring. The basic form of the product is a relatively generic private label card account (which I say metaphorically, as no physical card is issued), but Amazon Prime members who obtain and use the card receive a 5% discount on their purchases at (or the option for interest-free installment financing on items costing over $149). This is a powerful incentive to shift consumer payment behavior, first used by Target for its private label REDcards, which grew to represent over 20% of tender at the large discount retailer. It will be interesting to see how the market responds if Amazon begins aggressive promotion of this product, but we believe the impact on card issuers (especially Chase, as the issuer of the Amazon co-branded Visa credit card) could be significant. Frankly, any share shift at all within the payment mix of the huge and fast-growing online retailer is, by definition, significant.
  4. Walmart Pay. Just last week came the announcement of Walmart Pay, another QR code-based payment method that will be housed within Walmart’s popular mobile shopping app. Users of the app will be able to install any credit, debit or gift card accepted by Walmart in the app, as many have already done to make online purchases at (which is the second largest eCommerce site in the U.S., though far smaller than As with Chase Pay-MCX and Costco-Citibank-Visa, we suspect that Walmart has negotiated concessions in terms and pricing (in this case probably with the card networks) in order to neutralize the disadvantages of card-not-present credit card and unregulated debit card transactions via QR code and perhaps to move interchange charges below the standard rates published by the card networks. Interestingly, Walmart is a founding member of the MCX consortium. While the company has reiterated its ongoing support of MCX, this bold introduction of Walmart Pay would appear to undermine the MCX value proposition and market positioning. It’s not at all clear how Walmart might explain differentiated value propositions for Walmart Pay and an MCX-powered payment option to its customers.

These programs indicate a new-found willingness by retailers to try to shape the payment preferences of their customers, often utilizing in-kind loyalty incentives that drive business back to the retailer itself, rather than bank-sponsored reward programs that often provide third party rewards (e.g., airline miles, redeemable point currency, cash-back). At the same time, mobile apps facilitate a more intimate connection between retailer and consumer, such as the ability to know when a customer is visiting a store, while private label and co-branded cards deliver additional insight into who customers are and how they spend their money.

It is becoming clear that digital wallets will take many forms and come from multiple sources, likely reflecting the finite number of commercial relationships that assume special importance or value in the consumer’s life. The notion circulated not long ago that a single, “master-wallet” app would facilitate and guide consumer payments seems unlikely at this point.

That said, multi-merchant wallets will continue to have a place in the consumer’s financial life, providing an added measure of convenience for transacting at the long tail of small merchants, as well as at larger retailers where the strength of relationship does not justify the use of a dedicated app in the consumer’s mind. PayPal and the mobile wallets (Apple/Android/Samsung Pay) do this today. Checkout systems from Amazon, MasterCard, Visa, and American Express are attempting to do the same, as are some individual card issuers by using Host Card Emulation to install their cards within their mobile banking apps. Their success will probably be a function of what value added services they can introduce to complement their convenience benefits and each of these approaches should garner some following among a group of consumers.

Smaller merchants will continue to struggle to control payment acceptance costs in a world where they feel they must be passive takers of a range of consumer-determined payment instruments. Square and some other “next gen” payment service providers have improved the transparency and simplicity of acceptance pricing, but have limited ability to affect interchange costs and so far have not introduced alternative payment methods (e.g., ACH), which in any case, would need to be promoted through a consumer value proposition offered by the merchant.

Retail payments has long been a rather tilted game, with the largest merchants aggressively leveraging their huge transaction volumes to negotiate card acquiring fees that are frequently two orders of magnitude lower than those paid by local, independent merchants. We are now seeing that economic leverage gradually imposed on the rest of the payment value chain (short-circuiting network fees through negotiated, bilateral interchange) in a way that more fully reflects their importance of major retailers in the dominant consumer sector of the U.S. economy. The result will be some ongoing margin compression for the major financial players, which they could attempt to recoup through a range of actions, including pricing actions directed at smaller merchants and adjustments to consumer rewards programs. We’ll be watching the next set of moves on the payments chessboard with great interest.

This Payments View post was written by Glenbrook’s Bryan Derman.

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Post image for Interchange Regulation Comes to Europe

Interchange galvanizes the attention of regulators around the world like iron filings to a magnet. Everyone in card payments watches their moves closely because of its economic impact on merchants, card networks, issuers, acquirers and, in theory, consumer pricing. European regulators are among the most recent to weigh in.

Based on the EU’s Multilateral Interchange Fee legislation, effective December 9, interchange on many card products is now capped at 0.3% for credit and 0.2% for debit. The ripples are just beginning to spread. Join PSE Consulting’s Luke Purser and Glenbrook’s George Peabody as they discuss this shift in the European payments landscape. The conversation closes with Luke’s insightful comments on what it’s going to take to get the UK’s credit push system—Faster Payments—to the physical point of sale.

On a personal note, I am very grateful for your support of Payments on Fire over this year and look forward to bringing you more good conversations Send me you story ideas! In the meantime, in this complicated and challenging world, celebration and rest restore each and all of us. Warm wishes from me and Glenbrook Partners for a safe, happy, restful Christmas, Chanukah, Milad un Nabi, Kwanzaa, or whatever practice you favor and follow at this time of the year’s turning. — George Peabody


Post image for EMV’s Not-Very-Even Distribution

At our Glenbrook Payments Boot Camps, we often quote futurist and novelist William Gibson’s 1993 remark that “the future is already here — it’s just not very evenly distributed” in order to demonstrate that different payment methods take varying amounts of time to become commonplace. Over the last year and more, most boot camp attendees have assumed we’re talking about recent payment approaches like Apple Pay, Android Pay, Square, and others. But EMV, that Nineties-era technology that has finally made landfall in the U.S., is hardly evenly distributed here either.

For cardholders, the U.S. rollout and distribution of chip cards remains skewed by product, geography and by demographics. Talk to a group of well-heeled Silicon Valley techies and almost 100% of them will have chip-based credit cards. A third might have EMV debit cards. Talk to a similarly professional group in the Midwest and fewer than half the hands will go up. Ask about EMV debit cards and just a smattering will respond positively.

Merchants are also far from unanimous in their EMV acceptance readiness. Target and Wal-Mart are there; many others, especially mid-tier retailers, are waiting until at least next year. Even EMV-capable terminals are unevenly distributed in that demand for the most popular Verifone and Ingenico terminals—those that have been certified by leading processors—is high while inventories are tight.

Getting It Right Takes Time

Compared to magstripe cards, EMV is complex and variable. There is no one way to issue EMV cards. Chip and signature? Chip and PIN? Unlike magstripe, there’s no single, consistent path through an EMV transaction at the POS because of that variability as well as that of the merchant’s equipment.

During a recent consulting engagement, I spoke with retailers from the UK and Canada about their EMV transition. Two themes emerged. First, the big jump in complexity posed by EMV was best outsourced to a processor or other service provider so that the merchant’s IT staff could focus on other tasks (we’re seeing US merchants follow that path, too). The second thread was the need to optimize the new EMV payment flow. To accomplish that, time and motion studies were often required to determine what the clerk might do during the transaction. For large, throughput-sensitive merchants, such optimization matters; time, after all, is money.

But even figuring out the right words for the terminal prompts, I was told, takes time. I believe it. My own experience at a favorite market proved that point.

During my prior visits, EMV acceptance hadn’t been turned on, but during a mid-November visit, seeing that the EMV reader light was lit, I decided to swipe the card anyway to check what would happen. In proper EMV fashion, the terminal responded with “Card read error! Insert card.”

OK, I’ll admit that the intent of the message is clear enough but, strictly speaking, the prompt was inaccurate (and a bit unfriendly). There was no read error at all; reading the magstripe is how the terminal knew this was an EMV card. (Yes, I can be accused of nitpicking here.)

But forgive me for scratching my head at the prompt that appeared once I dipped my debit card (see picture). There was the usual oddity of having to choose credit or debit when using a debit card. But now I’m being asked to know what choose Visa Debit or “US Debit”, whatever that is.

Picking “US Debit”, of course, was necessary if I wanted to enter my PIN in order to get cash back. The well-trained clerk jumped in to explain that one. I’d figured as much but pity the “civilian” cardholder confronted by confusing and inconsistent prompts at different retailers.

In a market where simplicity and consistency has economic value—Apple Pay, PayPal, Amazon One-Click—cards are seemingly harder to use than ever while mobile payment methods proliferate and evolve. Of course, some merchants have contactless, many don’t, and some have even turned it off.

Don’t get me started on that topic.




Post image for Faster Payments in the US

Sending money in real-time is a capability that is growing around the world. “All bank” systems in the UK and Mexico are thriving. Mobile money services like M-Pesa are changing economies and individual lives in developing countries. But in the US, “things are complicated.” We have a crowded landscape in the US without, as in many global markets, a clear mandate from a regulator. In this Payments on Fire podcast, Glenbrook’s Carol Coye Benson and Dwolla’s Jordan Lampe join George Peabody for a discussion on the evolution of Faster Payments in the US, directories, bill pay, and the challenges of interoperability. And best wishes for a relaxing and happy Thanksgiving!


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Post image for Inside the Digital Payments Workshop

As new forms of digital payments begin to take hold, the old assumptions no longer work. What does it mean to issue a card when there is no card? How can transactions be risk-managed when payments credentials are masked and scrambled by design? And what is the impact on the loyalty and reward programs that are designed to depend on the presence of card data?

Those are the questions we asked ourselves when we set out to design Glenbrook’s new Payments Insights Workshop: Digital Payments. But what exactly are digital payments?

I first noticed American Express use the term “digital payments” in 2011 to describe a category of payment-related technologies that went beyond the traditional issuance of a card. They described P2P transactions between accounts as an example of a digital payment transaction.

More recently, Visa and MasterCard have embraced the term as a way to describe their push to store payment credentials in the cloud with tokens, instead of cards, being used to initiate payment. The networks even talk about their token-related services as “digital enablement” services. And their “checkout” products, of course, are a big part of token delivery.

We’ve structured the Payments Insights Workshop: Digital Payments to break down this new segment of the industry and explore the implications of the shift from physical to digital payments instruments. Here’s what we plan to discuss:

  • Digital Payments Overview – Provides an introduction to digital payments and puts them into market context. Why are digital payments happening now and not five years ago? We’ll look at the role of tokens, authentication, and cloud — and share our overall taxonomy of the space.
  • Tokenization Fundamentals – You can’t understand digital payments if you don’t understand tokenization. It’s as simple as that. We’ll start with the key tokenization concepts and take a look at the two leading approaches –– security tokens and EMVCo payment tokens. We’ll explore the models, look at the flows, and describe the roles and the data elements. We will also share current thinking on how tokenization concepts might be applied in non-card payment systems.
  • POS Mobile Wallets – POS Mobile Wallets are the first major deployment of EMVCo payment tokens. We will do a complete tear down on Apple Pay and then use that as a point of comparison against Android Pay, Samsung Pay, and Chase Pay to illustrate similarities and differences. Given the recent announcements at Money 20/20, we’ll also be exploring CurrentC (MCX) and the rise of NFC-enabled banking apps.
  • Checkout Wallets – Checkout Wallets are the second shoe dropping in the shift to digital payments. We’ll take a look at Visa Checkout and its underlying security model, as well as MasterCard MasterPass and Amex Express Checkout. We’ll share how they work, how they differ, and their likely evolution. Checkout Wallets are distinctly different than the old digital wallets as alternative forms of payment –– so you may be surprised.
  • Digital Payments Enablers – For online merchants, the rise of digital payments enablers has represented a sea change in the approach to online payment acceptance. Here we’ll compare Braintree, Stripe, and WePay and take a look at what they do, where they fit, and why they represent the next wave in payment acceptance. Our exploration will include a special emphasis on how these providers address the needs of ‘Marketplace’ providers.
  • P2P Mobile Apps – The shift to digital payments can also be seen in P2P Mobile Apps. This module will look at the general model and economics found in these types of systems. We’ll compare the underlying transaction model of Venmo, Square Cash, and Facebook Messenger––and share our perspective on P2P Mobile Apps in the developing world. This will include a case study on the evolution of the M-Pesa system in Kenya.
  • What Comes Next – The day will finish with a look at In-App payments and Buy Buttons, both important new developments that play right to the shift to digital payments. As part of What Comes Next, we will also share our thesis in how digital payments fit against the emerging Internet of Things.

We’ve put together a great agenda and I am looking forward to sharing our thinking at Glenbrook’s next Payments Insight Workshop: Digital Payments.

The next session is December 3rd, 2015 in Palo Alto, California as a standalone workshop or as a companion day to our next Payments Boot Camp on December 1st and 2nd. Please join us if you can.

For more information and to register:

Questions? Contact


Post image for Merchant App Stores Today

In what seems quite a number of years ago, back in 2012, Merchant Warehouse (now Cayan), announced what I think was the first “Merchant App Store”, marketed as the Genius Customer Engagement Platform. Running on a somewhat traditional Verifone MX915 terminal, it was an early forerunner to the current iOS and Android-powered tablet-based offerings. I loved the idea back in 2012, (and have been a cloud-based POS fan for years), but it’s been awhile since I’ve checked in to see where the industry is, particularly from the developer perspective.

As in the consumer-centric Apple App Store and Google Play, the potential benefits to developers are enormous, especially wide distribution at a reasonable price. I can’t even count the number of great ideas that have come through Glenbrook’s conference room that have ultimately failed since they just couldn’t get to market cost-effectively. This is particularly true for those trying to serve small and medium-sized businesses (SMBs).

I’ve checked in now with a number of developers as well as with platform providers (e.g., the tablet-based or purpose-built POS providers). A few things are clear:

  • It’s early in the game
  • It’s more complicated than throwing an “Angry Birds” game on Google Play
  • There’s a lot of thoughtful effort and meaningful resources going into this space by some (but not all) POS providers
  • The potential benefits to the POS providers, acquirers, and developers are meaningful but still elusive
  • Despite a few “hairballs”, it’s not that hard for a decent developer to get their apps onto multiple POS platforms

It’s Early in the Game – Even in the most popular merchant app stores, there are just over 200 apps available right now. But the potential is enormous – time and attendance, enhanced inventory and sales analytics, sales tax services, etc. It’s clear to me that, just like the Apple App Store and Google Play, POS platform providers such as FDC’s Clover and Poynt understand that there’s an economy-of-scale race going on. As they get more apps, it becomes more appealing to merchants, and the more merchants a platform gets, the more attractive they are to developers.

But it’s still Early Days. The small merchant is a busy person who doesn’t have time to experiment with dozens of third party apps in order to find the handful that could revolutionize their business. One participant in this ecosystem reported that these merchants generally install just two third party apps. Even if that’s low, it suggest how different merchants are from consumers using an app store.

Merchant Apps vs. Consumer-Centric Apps – paraphrasing an executive at a big-name acquirer, putting a merchant service in the POS app store isn’t like throwing another Angry Birds in front of consumers. Unlike consumer-centric apps, even paid ones, merchant apps must be held to a higher standard as it pertains to performance, value, and safety. Merchants expect that from their payment processors, and naturally expect the apps they use and buy from their providers to be of the utmost quality and value. In short, acquirers face a lot of reputation risk from the apps they offer to their merchants.

Wooing the Developer – based on conversations with developers and some platform providers, there’s a significant amount of time, expertise, and resources going into making these app stores both feature-rich and easy for developers to create their apps. Extensive code libraries for a variety of payment functions, RESTful APIs, SDKs, and developer support are a pre-requisite for attracting developers (OK, a large base of merchants also helps, but you get the idea).

Conversations with developers, for example, indicate that it’s easy to connect to multiple acquirers (as applicable), fetch POS data from the cloud, test their apps, redirect to the developer’s enrollment pages, etc. In addition, some are even providing marketing support to their developers to help spur sales.

Largely driven by these developer-friendly investments by the POS platform providers, as well as the use of the ubiquitous iOS and Android OS derivatives operating systems, developers can generally port over their apps from one OS to another in just a few weeks. In addition to the tools provided by the platforms themselves, there appears to be a wide and growing support base of developers more than willing to help out others.

One technical area we’re watching is the split between device and cloud-based applications and the ease of integration. Cloud-based services just need to present a standard API to all comers. Device-specific code can call on those web-based services. Some developers will have to carefully evaluate where to spend their efforts: on a broad-based cloud service or on app store-specific code. Obviously, there are functions that only an app can perform but in this age of omnichannel payments and commerce cloud-based services can touch activity at the POS and online.

Potential Benefits are Enormous – The payoff for acquirers is enormous, particularly regarding reducing merchant attrition. While the large, Tier 1 and Tier 2 merchants don’t change acquirers frequently, merchant turnover for smaller merchants is a decades old problem. It is not uncommon for acquirers to see 20% – 25% (or more) annual turnover of their small merchants. The nice way of saying this is that the average merchants stays with their acquirer for 4-5 years. But in reality, the average acquirer has to bring on 25% more merchants each year just to break even.

It’s quite reasonable to believe that these new POS/business management systems not only bring new revenues in a cutthroat pricing marketplace, but perhaps more importantly, keep those merchants longer. From a merchant retention standpoint, this may really be a “game changer”

Hairballs and Speed Bumps Could Slow Down the Serious Developers – Some notable systems are based on iOS or Android derivatives (e.g., Clover and Poynt are built on their own customized versions of Android). As such, developers may not have access to some functionality such as Google Maps, and iOS developers may have to deal with multiple users/profiles on iPads, but most seem to be able to work around that with other solutions.

But uptake is rarely about technology alone. Human nature and existing business models may slow the success of these merchant app stores. The major acquirers providing or offering these new platforms rely on their existing in-house and/or ISO sales organization to distribute these cool new tools. But that’s the same sales channel that’s been selling merchant services and countertop terminals for decades. Getting a new, more expensive cloud-based system onto a merchant’s counter may be a stretch. Getting that merchant to install a third party data analytics app, for example, could stretch the skills of that sales rep even further.

Some developers, of course, have taken the direct sales route. While that adds cost back into the business plan, that’s certainly worked for Square.

In short, I remain quite enthusiastic about these new POS systems in general, and love the idea and the progress, albeit a bit slow, of the merchant app stores.

I’d love to hear your thoughts!

This Payments Views post was written by Glenbrook’s Allen Weinberg.


Post image for Who Are You, Really? – FIDO’s Biometric Authentication

Since the first promise to pay was made, knowing who you’re dealing with has been a requirement. Authenticating the identity of a trading partner – a customer, an accountholder, a business or even a computer – is a burden that falls on the one extending trust because the giver takes on the transaction risk. In online and mobile transactions, the job of authentication has fallen on the password’s sagging shoulders in combination with other credentials such as a payment card or drivers license.

The smartphone has brought, to this world of stolen passwords, social security numbers, and other bits of personal information, the fingerprint and other biometric techniques. Authentication and convenience are no longer at odds. While Apple’s TouchID is at the heart of Apple Pay, the Android side is made up of a broad assembly of technology providers and users called the Fast Identity Online Alliance or FIDO Alliance. Take a listen to this discussion between FIDO board member Philip Andreae and Glenbrook’s George Peabody on how FIDO works and the growing role of biometrics in authentication.

Transcript below the break.

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Post image for It’s About the Blockchain

We’ve been working with bitcoin at Glenbrook for a few years now, teaching about it in our boot camps, and holding one-day workshops on math-based currencies and blockchain technology.

I have one conclusion. The focus of the evolution of digital money is shifting. Where that evolution will take us is still unknown.

To borrow a term from biology, the digital money ecosystem is beginning a period of adaptive radiation, a process that takes place when a founding entity morphs into multiple types, as each adapts to fill an unoccupied transaction niche or, usually later, to displace the incumbent. Bitcoin is, of course, the founder entity. Now, both entrepreneurs and big enterprise players are driving that evolution.

We Started with Currency

In the Digital Currencies, Bitcoin and the Blockchain workshop, we examine bitcoin against its multiple roles of currency, commodity, and payment rails. Today, the interest is squarely focused on blockchain as asset register. It’s been an instructive transition.

A couple of years ago, I wished for a quiet, even boring year for the Bitcoin ecosystem. I knew there’d always be the next bitcoin-soaked Silk Road story but calm in the exchange business and a measure of USD price stability for the currency were what I wanted to see.

Sometimes wishes are granted.

The bitcoin currency has stabilized. The winnowing of faulty exchange businesses has tossed out the scary incompetents and left well funded, better run firms who believe in the niceties of regulatory compliance, business insurance (things go wrong even in well run firms), and customer service. In percentage terms, the price volatility of bitcoin is not much different than that of the euro and the dollar over the past 18 months. So, the frothy “gotta get in” investment rush is over and a more mature market has emerged.

Bitcoin as Commodity

There is good evidence that bitcoin behaves today a lot more like a commodity. When many producers are present, commodity costs tend to be tightly coupled to the cost of production. Think wheat, corn, and iron ore. Yes, there are external market forces that push the cost around but when production costs exceed market price commodity producers either look to lower production costs further, horde their product, or get out altogether.

With bitcoin, that production cost is heavily influenced by the cost of power. Miners all over the world search high and low for the best energy deals, even into the mountains of Tibet.

Another feature of commodity prices is their relative stability when production and demand are in balance. We’re seeing that now. However, expect a price jump when the current cost/reward equation is changed next year and the bitcoin reward per block found is halved.

All About the Blockchain

2015’s story is the interest of fintech vendors, financial institutions, start-ups, and other enterprises in what blockchain ledgers have to offer. We’re seeing experimentation built on the bitcoin blockchain itself. We’re also seeing collaborative efforts among small groups of businesses (like Chain) evaluating the utility of private blockchains for the management of assets such as private company stock. The possibilities are almost endless — we discuss dozens in our upcoming workshop. With multiple proof of work and consensus-based ledger models to choose from, entrepreneurs and incumbents have non-trivial decisions to make.

No doubt, some of the announcements of pilot tests are just PR link bait because, while having your name associated with “bitcoin” was a toxic linkage, the word “blockchain” is cool.

Build It and Will They Come?

In the workshop, we also examine the transaction niches where blockchain tools could be of use including those not reliant on bitcoin itself.

We will see an evolution in incentives as well.

  • Bitcoin Miners Do It for the Bitcoin. Satoshi programmed, into the heart of bitcoin software, the reward of bitcoins to the miner that solves for the next valid block in the chain as the incentive for transaction processing and the creation of new bitcoins.
  • Want Some of My Currentcy? Other incentive models exist. Ripple has reserved a portion of the currency it relies upon for its own benefit.
  • For What’s Next. The operators of private blockchains may have no expectation of a reward at all. Stellar, a Ripple derivative, expects others to run its servers not in anticipation of a reward for work performed (a.k.a. mining) but simply as a platform service required by the value-added services built on top. Like basic internet services – DHCP, DNS, and HTTP servers come to mind – the value will emerge from what they enable.

Déjà Vu All Over Again

The coming period of experimentation reminds me of the internet’s first commercial flowering. Enterprises of all types examined how to use internet protocol technologies for their own purposes through intranets, extranets, and virtual private networks. Ever since, we’ve been building on that experience, producing no end of surprises.

For the early internet hippies, today’s “Net” doesn’t look like their original vision. The free exchange of ideas, not advertising, was supposed to be the lifeblood of the “Net.” The eventual internet dominance of firms like Facebook, Google, Amazon, and the other firms making up today’s online elite were not in that plan.

I suspect the bitcoin hippies will be just as disappointed in their baby’s next growth spurt as large financial institutions, internet players large and small, insurance companies, and perhaps even local and national governments adapt blockchain technology to their purposes. And just as with prior cycles, incumbents have no guarantee of success. While they may have reputation and regulation in their favor, neither is a certain barrier to competition.

Glenbrook’s next Virtual Currencies, Bitcoin, and the Blockchain Insight Workshop is coming up October 22 in New York City. It’s a great opportunity to work through these, and many more, issues. Eric McCune and I hope to see you there.

This post was written by Glenbrook’s George Peabody.



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