Wyndham Hotels Experiences New Customer Reward: Bitcoin | Payments Source

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A chart of the value of bitcoin, even for an hour, looks like a Richter scale reading along an active fault line, but for Bakkt this does not detract from the asset’s attractiveness in as a reward benefit. On the contrary, it enhances the attractiveness.

“Even with the volatility that we are seeing in the market, there is broader adoption by consumers and businesses, and there is adoption in the acquisition of digital assets,” said Sheela Zemlin, Managing Director from Atlanta-based Bakkt.

Bakkt recently signed an agreement with Wyndham Hotels & Resorts to integrate Wyndham Rewards into the Bakkt platform, opening an addressable market that includes 50,000 hotels, resorts and rentals worldwide, with 87 million registered members. Bakkt also launched a virtual Visa debit card at the end of June, allowing consumers to use bitcoin and cash balances in stores, online and across the entire Apple Pay and Google Pay footprint, covering retailers, supermarkets, public transport and other categories.

Wyndham’s integration, expected to launch this year, allows users to convert loyalty currencies such as points into cash, bitcoin, or discounted gift cards. Bakkt users can also pay with points within the Bakkt merchant network.

Wyndham is tackling a trend to improve options for earning and redeeming rewards. Starbucks, for example, recently updated its incentive program to add more payment options without having to preload a gift card, as well as greater support for digital wallets; Starbucks was also one of Bakkt’s first customers. There is also a momentum for cryptocurrency rewards. Quontic Bank and NYDIG launched a card in late 2020 that reimburses 1.5% in bitcoin for every debit card payment.

“We are looking to enable members to use and earn rewards points in different ways,” said Geoff Crossin, vice president of Loyalty and Partnerships at Wyndham Rewards, adding that internal research has revealed that consumers are more likely to use the loyalty program if there are more options.

The Wyndham debit card and contract capped off a busy spring for Bakkt, which operates a digital currency exchange as its core business. Since launching a digital wallet to combine bitcoin and other digital assets in late March, the three-year-old company has stacked a series of products to support incentive marketing and payment processing.

A partnership in April with digital payments company Cantaloupe is designed to support cryptocurrency payments and incentive marketing points across Cantaloupe’s unattended retail customer network. Another Bakkt digital wallet upgrade in June allows Bakkt users to send bitcoin, gift cards, and money to any user, not just those who use the Bakkt app, a initiative designed to extend digital asset transactions to broader social circles.

“We want to make digital assets accessible to as many people as possible, using digital assets such as rewards and loyalty points, whether it’s spending on goods or exchanging points for bitcoins to share and send to family members, ”Zemlin said.

The cryptocurrency suffers from price fluctuations and the most recent volatility was extreme, even by bitcoin standards. Bitcoin recently fell below $ 30,000 after hitting a high of over $ 64,000 in April. Dramatic daily valuation swings have often resulted from events as benign as Tesla CEO Elon Musk either buying bitcoin or making a cryptocurrency joke on TV.

There have also been regulatory moves that highlight the uncertainty of bitcoin trading and its valuation. UK regulators banned the Binance exchange following the withdrawal from the exchange of an application for registration with the Financial Conduct Authority because it did not meet anti-money laundering requirements. The Chinese and Indian governments have long imposed restrictions on cryptocurrency.

Regulators in the United States and Sweden are also reporting tighter controls. Michael Hsu, the acting currency controller, asked US regulatory agencies in early June to set up a “perimeter” to regulate cryptocurrency, reports the Financial Times. Stefan Ingves, the governor of Sweden’s central bank, said tighter regulations are on their way as the crypto market has grown so large it is attracting consumer interest, according to Bloomberg.

Bitcoin’s reputation for volatility and its potential risk of money laundering have long hampered its use as a payment method. Most cryptocurrency payment products involve converting to traditional currency before transactions. Some use stablecoins, which tie the value of a digital asset to a traditional currency.

Writing for American Banker, Felix Shipkevich, director of Shipkevich PLLC, said that there is a future for digital assets in incentive marketing, but “between the volatility of some digital currencies, coupled with conversion rates, you don’t want not lose money or create regulatory problems.

In an interview this week, Shipkevich said that if the reward is decentralized and tied to market fluctuations, there could be a major plus or minus. “Until we have some regulatory clarity around these decentralized rewards, the buyer should be wary,” he said. “You can wake up and find a diminished value.”

Wyndham did not specifically address the volatility of bitcoin, but pointed to the general popularity of the cryptocurrency and the desire to provide consumers with a crypto option from a larger menu.

“We want to meet members where they are and allow them to do whatever they want with the rewards,” said Crossin, adding that no matter how consumers choose to convert points, provide more choice. will increase the value of Wyndham Rewards points.

Bakkt claims that it supports a variety of currency types for incentive marketing, which provides flexibility. “Crypto and bitcoin aren’t the only things you can acquire,” Zemlin said, noting that gift cards are another option.

There is also a potential benefit to the volatility of crypto, especially if the consumer views the “refund” of bitcoin loyalty points as an investment rather than a means of payment. Square, for example, has used bitcoin trading to generate income as crypto has become more mainstream.

“Different types of cryptocurrency can enhance loyalty programs,” said Rick Ogelsby, president of AZ Payments Group, adding that when crypto is issued for free to consumers, volatility can provide an advantage because it offers an advantage. to the recipient.

Additionally, cryptocurrencies are generally transferable, Oglesby said. “These features may offer an additional bonus over traditional loyalty programs that issue fiat currencies or points that can be used for future purchases at a fixed rate.”

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