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Apple is poised for a grand fintech offensive

Protocol Fintech

Good morning, and welcome to Protocol Fintech. This Thursday: Robinhood cashes in, Apple is poised for a fintech offensive, and El Salvador holds back on its bitcoin bond.

Off the chain

Robinhood shareholders didn’t seem impressed by the splashy rollout of its new spending account, the latest evolution of a product that’s seen a troubled road to market. Its first attempt to introduce a “Checking” product in 2018 ran aground when SIPC refused to extend its brokerage-account insurance to the product. It revamped the product in 2019 with FDIC insurance. The 2022 version — called Robinhood Cash Card, or the Robinhood Money LLC Stored Value Account if you’re nasty — offers a bonus on rounded-up savings that varies from 10% to 100%. It’s a practical product, and the interchange on debit card purchases could be a steady revenue stream. But it’s not as exciting as the go-go stock and crypto trading that once juiced Robinhood’s own shares.

— Owen Thomas (email | twitter)

Apple's fintech offensive

Apple has been making big fintech moves recently. It’s reportedly buying U.K. open-banking startup Credit Kudos for around $150 million. Last month, it said merchants would soon be able to use the iPhone directly to process payments, no extra hardware required.

The tech giant already has a beachhead in financial services with Apple Pay, the Apple Card and iMessage — not to mention the huge volume of payments it processes for consumers and developers via iTunes and the App Store. Is Apple gearing up for another fintech offensive?

Financial data is a key to success. Credit Kudos gives Apple data aggregation tools like those offered by Plaid and Finicity.

  • Also known as open banking, that direct data access is crucial for fintech — that’s why Mastercard bought Finicity and Visa tried to buy Plaid.
  • Apple’s deal could also be about geographic expansion, though. Buying Credit Kudos appears to bring Apple “a step closer to being able to offer Apple Card and other services in the U.K.,” Melody Brue, an analyst with Moor Insights & Strategy, told Protocol.
  • Apple Card’s U.S.-only scope is a weakness in Apple’s fintech strategy. “We’re approaching the three-year anniversary of the Apple Card’s announcement, and it is surprising that a company once known for deal-making has been unable to expand that key offering,” Bloomberg’s Mark Gurman wrote in January.
  • Brue also speculated that Apple could be eyeing new services, such as the fast-growing “buy now, pay later” industry. Credit Kudos offers “access to financial history and data without a hard credit check, or reliance on the traditional credit score model,” she said — crucial elements to offer instant installment plans.

Apple’s also going after small businesses. The company rolled out a new feature called Tap to Pay which enables merchants to accept payments with a tap on their iPhone.

  • Apple’s Tap to Pay service doesn’t actually process any payments. Instead, it replaces the hardware that reads credit or debit card numbers. That’s why you should ignore headlines that claim things like “Apple wants to kill Square”: That analysis wholly ignores the Block payments unit’s evolution from offering dongles to selling more sophisticated software and services that Apple’s offering doesn’t touch.
  • Apple is arming Block’s competition, though. It partnered with another fintech powerhouse, Stripe, for this rollout. The new feature means businesses will be able to “accept contactless payments on a device that's already in your pocket: your iPhone," Billy Alvarado, Stripe's chief business officer, told Reuters.

That’s where things get interesting for Apple. Though developers complain about some App Store practices, Apple doesn’t take a toll from retail ecommerce or in-person payments aside from a small Apple Pay fee it charges banks. Put Tap to Pay, Apple Card and open banking together, and you can see the glimmerings of a payments system that bypasses credit card networks and their fees altogether. That could line up Apple’s interests with those of merchants and software developers, and lessen fears about another Big Tech player moving into fintech.

It helps that Apple has managed to “set itself apart from the Big Tech stigma,” Brue said. “With time, attractive offerings and no missteps, the company is easily seen also as a financial services company.”

— Benjamin Pimentel (email | twitter)


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On the money

On Protocol: Malaysia just can't make up its mind about crypto. Days after one government minister said encouraging its development was important for the country’s youth, another said there were no plans to make it legal tender. is an official sponsor of the FIFA World Cup. In another move by to cement itself in the sports world, the soccer competition has announced that the crypto exchange will be its exclusive crypto-trading sponsor.

GameStop started beta-testing its NFT marketplace. Loopring said the new marketplace would be built on its Ethereum scaling technology, resulting in a surge of the LRC token price, up 34% after the GameStop announcement. Immutable X president and co-founder Robbie Ferguson tried to clear up the confusion, saying his company would still be providing technology for the marketplace.

Meta filed eight trademarks relating to crypto and blockchain software. The trademark applications were for its blue two-loop logo, signifying possible moves into crypto. If only Meta hadn’t just abandoned its biggest crypto project ….

Canadian authorities are having trouble seizing bitcoin from the Freedom Convoy. Although the Ontario Supreme Court ordered owners of a multi-signature wallet controlling the donated bitcoin to freeze the holdings, the bitcoin was reportedly already distributed to several unidentified wallets.

Thailand’s SEC will ban crypto as a payment method. The Thai Securities and Exchange Commission said that while there were money laundering concerns behind the ban, this did not signify a wholesale ban on crypto.

El Salvador postponed its bitcoin-backed bond. Minister of Finance Alejandro Zelaya said the country was waiting for “favorable conditions in the financial market,” citing the volatility of bitcoin amid the Russian invasion of Ukraine.


Casey Newton, editor of Platformer, thinks that the Web3 ideal of decentralization is dying, and the ApeCoin project was a perfect illustration of it. “Self-dealing founders and investors; a hype machine in overdrive; and a growing disconnect between the Web3 we were promised and the one that’s being traded on the crypto exchanges,” he wrote in the newsletter.

Robinhood’s new Cash Card is a debit card with saving and investing features, meant for young people with little to no credit. “My first observation is that a lot of these credit cards are, whether intentionally or not, predatory. They have the low rates, et cetera,” Chief Product Officer Aparna Chennapragada said in an interview with the Verge.

Fed chair Jerome Powell still thinks that new forms of money, such as crypto, stablecoins and even CBDCs, present risks to the U.S. financial system and need specific rules. “Our existing regulatory frameworks were not built with a digital world in mind,” he said at a panel.

Moves and hires

Mass Fintech Hub named a number of CEOs to its board. The public-private partnership announced new appointments, including Putnam Investments CEO Bob Reynolds, MassMutual U.S. head Mike Fanning, Eastern Bank CEO Bob Rivers, Insurify CEO Snejina Zacharia and Flywire CEO Mike Massaro.

Kickstarter CEO Aziz Hasan is stepping down. Hasan is leaving the crowdfunding company at the end of March, and COO Sean Leow will be interim CEO pending the company’s search for a permanent replacement. appointed Rinki Sethi as its vice president and CISO. Sethi was previously VP and CISO at Twitter and Rubrik, and will lead global information security and technology functions in her new position.

Former Stripe CMO Jim Stoneham is joining VC firm SignalFire. Stoneham, who left Stripe in October, will join the early-stage VC firm as an operating partner and aid startups in scaling by “co-creating go-to-market strategies.”

Ex-Treasury official James Freis is joining MoonPay. Freis is joining the crypto payments company as a special adviser for regulatory matters. He was interim CEO of scandal-ridden German fintech Wirecard and the director of FinCEN during the Bush and Obama administrations.


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