While Microsoft may accept Bitcoin for its Xbox Games Store could be a good sign for the industry, it is unlikely to have a major impact.
Microsoft has been sending mixed signals when it comes to its true intentions regarding Bitcoin (BTC) as well as the cryptocurrency market in general. On one hand, Microsoft president Brad Smith gave an interview earlier this year, claiming that the multinational was not even the least bit interested in dabbling in Bitcoin, stating that Tesla’s move to invest $1.5 billion had not changed anything for the company.
However, just a couple of days ago, the tech giant seemed to showcase a change of heart by reportedly releasing a poll online asking its customers how they would like to pay for their purchases in the Xbox Games Store in the future, with one of the most prominent options on the list being Bitcoin.
This development also comes right after Smith stating that fintech firms have no business issuing private digital currencies, arguing that central banks are there to look after the “common good” of the masses and thus should be the ones who are in command of the world’s money supply streams.
If Bitcoin does get accepted as a means of payment in the Xbox Games Store, it would not be the first time that Microsoft would have dabbled in crypto because as far back as 2014, the company has been accepting Bitcoin to fund its accounts, allowing United States-based users to acquire a whole host of content from their Windows Store — including Xbox gaming titles.
That being said, the firm’s crypto foray came to a standstill in 2018 when the market as a whole was on the receiving end of insane bearish pressure, causing the value of most cryptocurrencies to tumble to relative lows. However, earlier this year, Microsoft once again decided to allow Bitcoin payments, albeit only for its MS Store.
Does Microsoft’s interest change anything for the industry?
On March 24, Tesla CEO Elon Musk announced that his company would be accepting Bitcoin as payment for its cars, leading many from the social media world to come forth and declare that crypto had finally gone mainstream. However, even if so, it’s definitely not clear-cut that BTC will become a mainstream means of payment if other large companies, like Microsoft, which have questioned crypto in the past, would allow crypto as a payment method.
On the subject, Joe Zhou, founder and CEO of FirstBlood — a blockchain-based esports platform — told Cointelegraph that, by and large, this development seems to be positive on paper, especially as it stands to help increase crypto adoption across the global digital landscape, adding:
“So far, gaming publishers haven’t been early adopters of such technology. For example, the creators of League of Legends — Riot Games — have a no-blockchain policy. I would think so, if you are allowing your users to use crypto to make purchases in your ecosystem, your competitors will be more likely to follow, otherwise they’d be missing out.”
Zhou further opined that if Microsoft does decide to enable crypto payments, it could potentially lay the perfect groundwork for the marriage of the gaming and crypto communities, especially since he believes that gamers in the 18–35 age bracket are the ones who are most likely to hodl digital currencies in the future.
Lastly, in his view, apps such as Cash App and PayPal that allow users to buy and hold crypto will further help in merging the two worlds, allowing for even greater adoption within the gaming community. “I would be most curious about how Microsoft’s treasury department is going to handle their crypto revenues. Will they liquidate for fiat? Or are they going to hold them like Tesla and MicroStrategy,” he added
Is Microsoft short-sighted in its crypto outlook?
Though there are many who believe that Microsoft’s interest in incorporating crypto into its existing payment framework is a sign for big things to come in the future, Andrew Colosimo, co-founder of Xaya — a blockchain gaming and digital asset management platform — told Cointelegraph that although the development itself is a positive signal, he’s not entirely sure if it will have a major immediate impact on Bitcoin, adding:
“Transaction fees could add $5+ on to existing costs unless Microsoft wants to make use of payment channels like the Lightning Network as some people in that thread have already suggested. Gamers will just pay whatever costs less. However, most importantly, nobody wants to spend their Bitcoin.”
That being said, he did concede that if just one major player like Microsoft was to start taking BTC as payment, it could set in motion a ripple effect, causing other console operators to potentially follow suit.
Similarly, Hatem Hachana, chief operating officer of Utopia Genesis Foundation — a blockchain-based platform for the tokenization of music rights, assets and royalties — believes that most gamers are already familiar with the concept of in-game purchases at this point, so simply adding a crypto payment option will not make that big of a difference even though it stands to draw some more mainstream adoption.
He added: “If Microsoft adopts, Sony and Nintendo will for sure follow this path. Just looking at the whole space, everybody is adapting, moving forward and integrating crypto.”
Crypto adoption makes sense
It seems quite likely that Microsoft may be seeing a new trend around crypto, especially with the nonfungible token market — a space that has been soaring recently. To put things into perspective, the digital collectibles market has seen its value rise substantially over the last few months, with an increasing number of celebrities cashing in on the trend of digitizing their works.
Related: NFT ‘art revolution’: Beeple on his 5,040-day labor of love
For example, Twitter CEO Jack Dorsey’s first-ever tweet has been recently sold in the form of an NFT for a sum of $2.9 million. Similarly, Mike Winkelmann — the artist known as Beeple — has recently sold one of his works via auction house Christie’s for a whopping $69 million, making him one of the most valued artists in the world today.
Thus, it stands to reason that Microsoft may once again be looking to explore this ever-evolving space and potentially expose its extensive customer base — with the number of people who own an Xbox One console touted to be around 48.69 million — to the digital asset market. In the end, if BTC comes back onto the platform as a payments method, it would mark it as a moment of redemption for the cryptocurrency, suggesting that it could stay there for a while longer than before.