Bitcoin start-ups in Asia take aim at remittances market

‘Bitcoin is so much better as a mechanism to send money around the world,’ said George Harrap, chief executive of Bitspark. (Reuters)
Updated 13 March 2018
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Bitcoin start-ups in Asia take aim at remittances market

HONG KONG/SEOUL: Bitcoin, battered by warnings about volatility and bubble-like appreciation, may have found a way to play a niche role in a big market: overseas money transfers.
Used as a transfer mechanism rather than a currency, bitcoin circumvents banks’ transaction fees.
Start-ups such as Bitspark in Hong Kong, and Bloom, Payphil, coins.ph and Satoshi Citadel Industries’ (SCI) remittance unit Rebit in Philippines, are trying to turn that into a business model.
Reduced liquidity on cryptocurrency exchanges and regulatory uncertainty are, for now, limiting monthly bitcoin-based remittances to millions of dollars in a multibillion-dollar market, the start-ups say. But if cryptocurrencies mature, they say, traditional businesses will be in for some serious disruption.
“Bitcoin is so much better as a mechanism to send money around the world,” said George Harrap, chief executive of Bitspark, a company that performs transfers for dozens of remittance shops in Hong Kong, Philippines, Indonesia, Vietnam, Pakistan, Nigeria and Ghana. “There’s a lot less overhead that you need to do.”
Many of the start-ups, such as Bitspark, do not deal directly with individual customers, but instead provide the “back end” transfer mechanism for remittance shops.
The businesses estimate how much money they will need for a day, buy bitcoin in advance and immediately sell it for the currency in the receiving country. That means they do not hold cryptocurrency for any meaningful length of time, and customers’ transactions are resolved in minutes, rather than days.
Kate Corporal, 28, a Filipino working at an international company in Incheon, South Korea, said she saved “huge” amounts sending money home using Rebit compared with traditional services.
“One thing I can guarantee is that the money I intended to send and the money that my family received was exactly the same,” Corporal said. “Using bitcoin is really helpful for many Filipinos ... as every single cent that we send can be very significant.”
Reduced demand for cryptocurrencies in smaller economies often means bitcoin prices are lower, so sending $100 to Indonesia or the Philippines via bitcoin results in the equivalent of more than $100 at the other end. Without the bank fees, the shops say they can charge their customers 25 to 75 percent less.
But the model has little to no advantage in markets with larger Filipino communities such as Hong Kong and Singapore, where competition is high and fees are low — roughly 1-2 percent, compared with 10-15 percent in South Korea.
Rebit sends money to Philippines mainly from South Korea, Japan and Canada and is looking to expand to the Middle East.
The giants Western Union and Moneygram, which dominate the current market, are testing Ripple’s XRP, a cryptocurrency smaller and more centralized than bitcoin.
But the industry’s transformation does not appear imminent.
The value of all bitcoin held globally is about $160 billion, roughly two-thirds of the Asian remittance market and a third of the global one, according to World Bank estimates. That means local cryptocurrency exchanges cannot cope with the cash flow needs of larger businesses.
“As soon as you’re doing $10-15 million a day, liquidity becomes an issue and you’re wondering, ‘how am I going to do this,’” said Prajit Nanu, chief executive and co-founder of InstaReM, which remits money to over 60 countries.
The start-ups avoid holding bitcoin for more than a few minutes because of its volatility.
Bitcoin now trades around $10,000, 10 times higher than a year ago, but half its December peak — a common swing for the emerging asset class.
“We started in 2014, when bitcoin crashed from $1,000 to $200-$300 and luckily our business model didn’t rely on speculation,” said SCI co-founder Miguel Cuneta.
“We are merely using it as a transfer mechanism,” he added. “We convert it as soon as possible.”
Cuneta says Rebit was only approved by Philippine’s central bank last year. South Korea’s backing away from banning cryptocurrency trading was encouraging, he said, but more clarity was needed in Seoul and elsewhere.
In Singapore, start-up Toast gave up using bitcoin for remittances so it could get licensed. It is now transferring money the traditional way but plans to offer loans and insurance using blockchain technology and smart contracts — a product offered by bitcoin’s main rival Ether and others.
“If you bought cryptocurrency as part of a money remittance mechanism it is very difficult to get your remittance license in Singapore or anywhere else because the regulators are still not sure how they are going to govern cryptocurrency,” said Aaron Siwoku, Toast’s founder.


Amazon workers strike as ‘Prime’ shopping frenzy hits

Updated 16 July 2019
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Amazon workers strike as ‘Prime’ shopping frenzy hits

  • The protesters waves signs with messages along the lines of “We’re human, not robots”
  • The strike was part of an ongoing effort to pressure the company on issues including job safety, equal opportunity in the workplace, and concrete action on issues including climate change

SAN FRANCISCO: Amazon workers walked out of a main distribution center in Minnesota on Monday, protesting for improved working conditions during the e-commerce titan’s major “Prime” shopping event.
Amazon workers picketed outside the facility, briefly delaying a few trucks and waving signs with messages along the lines of “We’re human, not robots.”
“We know Prime Day is a big day for Amazon, so we hope this strike will help executives understand how serious we are about wanting real change that will uplift the workers in Amazon’s warehouses,” striker Safiyo Mohamed said in a release.
“We create a lot of wealth for Amazon, but they aren’t treating us with the respect and dignity that we deserve.”
Organizers did not disclose the number of strikers, who said employees picketed for about an hour in intense heat before cutting the protest short due to the onset of heavy rain.
The strike was part of an ongoing effort to pressure the company on issues including job safety, equal opportunity in the workplace, and concrete action on issues including climate change, according to community organization Awood Center.
US Democratic presidential contenders Kamila Harris and Bernie Sanders were among those who expressed support for the strikers on Twitter.
“I stand in solidarity with the courageous Amazon workers engaging in a work stoppage against unconscionable working conditions in their warehouses,” Sanders said in a tweet.
“It is not too much to ask that a company owned by the wealthiest person in the world treat its workers with dignity and respect.”
Amazon employees also went on strike at seven locations in Germany, demanding better wages as the US online retail giant launched its two-day global shopping discount extravaganza called Prime Day.
Amazon had said in advance that the strike would not affect deliveries to customers.
Amazon has consistently defended work conditions, contending it is a leader when it comes to paying workers at least $15 hourly and providing benefits.
The company last week announced plans to offer job training to around one-third of its US workforce to help them gain skills to adapt to new technologies.
Amazon has been hustling to offer one-day deliver on a wider array of products as a perk for paying $119 annually to be a member of its “Prime” service, which includes streaming films and television shows.
The work action came on the opening day of a major “Prime” shopping event started in 2015.
Now in 17 countries, the event will span Monday and Tuesday, highlighted by a pre-recorded Taylor Swift video concert and promotions across a range of products and services from the e-commerce leader.
Prime Day sales for Amazon are expected to hit $5 billion this year, up from $3.2 billion in 2018, which at the time represented its biggest ever global shopping event, JP Morgan analyst Doug Anmuth says in a research note.