Apple Pay Will Not Kill Bitcoin

Google Wallet

The big news this week is that Apple is finally getting into mobile payments. With the news, there has been a vocal opinion by many that this is going to kill Bitcoin. Hah!

Apple is late to the game, and now joining the likes of Paypal, Google, Venmo, Dwolla, Facebook, and Amazon in the highly competitive mobile payments space, none of which have “killed” Bitcoin yet. Despite what the media wants you to believe, this isn’t a major innovation by Apple, this is them playing catch up, implementing a feature that should have been a key aspect of the iPhone years ago. Yes, Apple is a heavyweight with tons of cash, great connections, and a loyal customer base, but Google, Paypal, Facebook, and Amazon aren’t exactly lightweights either.

When it comes down to it, none of them are competing with Bitcoin, they are payments systems, not decentralized currencies. I’m the first one to admit it, services like Google Wallet are infinitely easier and better payment methods than Bitcoin. Using Google Wallet I can instantly send money with no fees, and Google protects me with consumer protection laws similar to credit cards. Google Wallet is awesome. That being said, it is not a competitor to Bitcoin: it is a closed system that enables you to transfer existing currencies. I could see a future where Google, Paypal, and Apple allow you to fund your account with Bitcoin, and then you can use their closed payment system for transfers. In this way, Apple wallet could work alongside Bitcoin, it isn’t necessarily one versus the other. With all that said, Apple’s system will most likely be even more of a closed system than the companies they plan to compete with. How useful is a payment system if you can only use it with Apple iPhones and iPads? All of Apple’s competitors allow you to use your choice of phone/device, so it should be interesting to see if Apple decides to continue their usual path of closing off their services to only Apple device users.

In fact, the biggest change we will see as consumers is that NFC may finally take off, and that benefits everyone, especially Bitcoin users. NFC is a low power communication tech that allows mobile payments and any type of data transmission by simply tapping your phone. Google has had NFC in its phones for years, believe it or not, I can walk into a Duane Reade and pay by just tapping my phone with zero fees, instantly, using Google Wallet on my Nexus 5. I can also tap my phone to someone elses phone, if they have NFC, and instantly transfer files, contacts, or Bitcoin. That being said, the usefulness of NFC has been limited because Apple hasn’t included it in an iPhone. Apple has single handidly held back adoption of this amazing technology in the United States, even though you can use it to pay for the subway in places like South Korea. With Apple wallet coming out, and NFC rumored to be included in the iPhone 6, we will begin to see NFC tech in more places than ever before. Here’s the big one: With the proper software, anywhere that has an NFC terminal or any phone that has NFC built in, can easilly accept Bitcoin payments without QR codes, just a quick tap of your phone and the Bitcoin payment is sent.

Apple Wallet and Bitcoin are completely different. One is merely a payment system, while the other is a decentralized and deflationary digital currency that anyone can build apps with.


Bitcoin has several advantages:

  • It permits direct transfers of funds from one person to another, with no middleman (bank).

    • This eliminates the need to trust any third party, and eliminates the fees that they charge.
  • It cannot be forged/counterfeited! This is not true of any traditional currency, or even gold.

  • It cannot be inflated at the whim of any government. Inflation occurs when the quantity of a currency is increased.

    • The Federal Reserve of the United States prints more US Dollars everyday, this means the spending power of the dollar in your pocket goes down every time another dollar is printed.
    • Bitcoin on the other hand has a finite supply just like gold, there will never be more than 21 million bitcoin.
  • Similar to cash, transactions cannot be reversed -- they are final. Once a merchant receives bitcoin funds, they cannot be taken back without the merchant initiating the transaction.

    • Credit Card charge backs can be reversed up to a month after the transaction.
    • Same with PayPal.
  • It has the essential qualities that a currency must possess, some to an extent never before seen.

    • It is divisible to any unit size: each bitcoin is made up of 100 million Satoshis for instance
    • It is completely fungible: every bitcoin is indistinguishable from every other in value)
    • It is completely portable: funds are stored in the cloud (the blockchain)
      • It can be sent anywhere as easily as an email or text message (imagine the problems sending $10 million in gold to Zimbabwe).
      • You are currently not allowed to travel out of America with more than $10,000 without declaring it to customs. With bitcoin you can travel with millions of dollars and customs would be none the wiser.
  • It obviates many of the needs for banks, since you can safely keep your money yourself (once you follow some important security guidelines).

    • Some people will choose to still use banks for security and ease of use but at least they have the option not to.
  • Just like cash, it does not require identification of individuals in a transaction, thus eliminating the major cause of identity theft.

    • When Target was hacked, anyone who had used a credit or debit card there was at risk.
    • When you pay with bitcoin, the merchant only sees your public key so even if their system is compromised, a hacker can’t take any of your funds. You no longer have to trust the merchant.
  • Proof of Payment

    • All transactions are recorded in the blockchain so you have hard proof that you paid someone and when the payment went through.

Disclaimer: This post is intended solely to provide information. As I have no knowledge of individual circumstances and technical level, readers are expected to complete their own due diligence before proceeding with anything mentioned in this article. The topics discussed in this post are advanced and readers proceed at their own risk.