Before getting into how Starbucks connects with Bakkt, it is important to understand at a high level what Bakkt is and who runs it.
“Bakkt is designed to enable consumers and institutions to seamlessly buy, sell, store and spend digital assets. Formed with the purpose of bringing trust, efficiency and commerce to digital assets, Bakkt seeks to develop open technology to connect existing market and merchant infrastructure to the blockchain.“ –Starbucks Stories & News
The Intercontinental Exchange (ICE) is the parent company that owns both the New York Stock Exchange and Bakkt. The aim of the company is to create a federally regulated market for Bitcoin through their first product, physically-settled Bitcoin futures markets. Unlike the CBOE, which settles their futures contracts in USD, Bakkt will deliver actual Bitcoin to users accounts.
While this project has been in talks for a very long time, it appears that Bakkt will launch in Q3 2019, even though we are still waiting for CFTC approval.
“Bakkt is designed to serve as a scalable on-ramp for institutional, merchant and consumer participation in digital assets by promoting greater efficiency, security and utility…We are collaborating to build an open platform that helps unlock the transformative potential of digital assets across global markets and commerce.” –Kelly Loeffler, CEO of Bakkt
This is where Starbucks comes in (and Microsoft). In order to help with the adoption of their product, Bakkt has formed partnerships with different businesses, most importantly Starbucks and Microsoft.
While Microsoft’s cloud solution will be utilized in order to allow users to buy, sell, store, and spend their cryptocurrencies on their global network, Starbucks will allow users to spend their Bitcoin at their stores. While they will not be receiving the actual Bitcoin (it will be converted to USD before Starbucks takes custody), it is still good to see brick and mortar businesses of their stature seeing promise in this.
It is unclear what exactly Starbucks is receiving for doing this, but they appear to have received equity in Bakkt even though they didn’t pay for their portion (only had to indirectly accept Bitcoin payments). The percentage hasn’t yet been verified.
“As the flagship retailer, Starbucks will play a pivotal role in developing practical, trusted and regulated applications for consumers to convert their digital assets into US dollars for use at Starbucks…As a leader in Mobile Pay to our more than 15 million Starbucks Rewards members, Starbucks is committed to innovation for expanding payment options for our customers.” -Maria Smith, Vice President of Partnerships and Payments for Starbucks