Bitcoin Lightning Network dApp Strike Aims to Take Visa & Mastercard out of Business
Bitcoin Lightning Network payments company Strike raises $80 million to expand its footprint to larger financial institutions.
The funding round was led by Ten31 and included Washington University, the University of Wyoming, and others. Strike will use the funds to expand its reach into merchants and payment institutions.
“We’re moving full speed ahead not just to integrate Strike’s revolutionary payments with leading merchants, but globally, with a variety of businesses and partners to innovate and deliver on more financial inclusion,” said Strike CEO Jack Mallers.
Ten31 Managing Partner Grant Gilliam also weighed in. “We believe Strike is poised to disrupt the financial services and payments landscape, enabling a more efficient, innovative, and inclusive financial experience for everyone. We are excited about supporting Strike’s next phase and strengthening our partnership together,” he said.
This partnership follows the launch of Strike’s Application Programming Interface with e-commerce partners BlackHawk, NCR, and Shopify. The API allows for instant global payment settlements without legacy transaction fees.
Strike pitches tech to reduce payment headaches
Aside from the API, Strike is also planning to target its payments technology at large financial companies engaged in sending or receiving payments.
“Businesses and institutions want a groundbreaking experience sending payments as well. We can empower businesses to move money in ways networks such as card networks and SWIFT can’t, and we pay these partners in the form of commissions to do so, which makes it an exciting innovation for everyone. We’ve seen a lot of demand here,” said Mallers.
Strike’s vision is to enable users to instantly make and receive payments from anywhere, using the decentralized network underpinning bitcoin, the world’s largest cryptocurrency by market cap.
Strike made inroads into the global payments space by integrating its API into Twitter, enabling content creators to receive tips from fans using Bitcoin’s Lightning Network, a layer-two solution on the bitcoin blockchain which allows micropayments through payment channels. The product was initially rolled out to iOS users and later expanded to Android users.
Strike was also a key partner in El Salvador’s adoption of bitcoin as legal tender last year. It launched its mobile payments app in the country in March 2021.
MasterCard leverages widespread acceptance
While Strike looks to disrupt the payments space using the bitcoin network, payment incumbents like Visa and MasterCard are trying the reverse tack: bringing crypto to their traditional payment business. Some argue that this approach will legitimize Web3 technologies and encourage mainstream adoption.
In Aug. 2022, MasterCard announced a partnership with Binance, the world’s largest cryptocurrency exchange by trading volume, to allow Binance account holders to pay for everyday items using MasterCard’s rails and crypto they hold on Binance. The card will convert crypto into fiat at the time of sale and will be rolled out initially in Argentina.
MasterCard has also teamed up with crypto app hi to enable cardholders to display the non-fungible tokens they hold on their cards, subject to MasterCard’s rules and the tier they are a part of on hi’s platform. A user’s tier depends on how many HI tokens they have staked. Only gold-tier members will be allowed to decorate their cards.
Earlier this year, the company partnered with U.S. crypto exchange Coinbase to enable NFT buyers to pay for their NFTs using their MasterCard instead of cryptocurrencies.
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