Zap, a new Lightning Network payment company backed by Visa through its Fintech Fast Track program, on Wednesday announced the launch of Strike Global, another bitcoin-enabled payment and transfer app.
A statement from CEO Jack Mullers highlighted the differences between standard coin transfer mechanisms and Strike Global’s lightning-driven mechanism. Mullers focused on remittances, a multi-billion dollar trade that still runs through expensive intermediaries.
Strike Global is not much different from traditional fintech implementations, but uses a Lightning grid for alignment. This means payments can be almost instantaneous and at a fraction of the cost of traditional sliding beams.
Strike Global has two types of conversions based on the location of the recipient. In countries with a well-developed banking system, Strike allows users to send payments without using Bitcoin (BTC). Strike will automatically withdraw money from the user’s bank account, exchange it for BTC, and then convert it back to fiat currency and the recipient’s banking system.
The system largely disables the existing Bitcoin exchange infrastructure, which in fact allows much cheaper and easier transfers if users want to view them manually. Since national exchanges are usually integrated with the local banking system, using bitcoin or other cryptocurrencies can significantly reduce conversion rates compared to cross-border banking.
In countries without a developed banking system, Strike allows users to store their money in Bitcoin or Tether (USDT). The cryptocurrency can then be converted to local money or fiat using special solutions such as bitcoin ATMs, local bitcoins, and others. Strike simplifies multiple internal exchanges to make it work similar to other fintech applications.
The startup has partnered with Bittrex to create exchange users on Strike and the Lightning Network. In the first quarter of 2021, it plans to complete private and public beta tests in addition to issuing Strike Visa cards in the United States. The cards are expected to launch in the EU and UK in the second quarter.
The adoption is happening as companies begin to adopt more and more new bitcoin technologies. Kraken has pledged to implement Lightning integration in 2021, and Binance recently added support for Bitcoin’s SegWit address.