Ever since Steve Jobs announced the first iPhone in early 2007, the tech giant has been adopting different strategies to enhance its competitiveness. Just recently, after Apple decided to open its NFC payment functionality to third-party developers, Jeremy Allaire, the CEO of Circle, hinted they would soon provide the company with tap-to-tap USDC stablecoin.
And did you know that this move could actually affect the prices of Ethereum, which, according to Binance, stood at $2,606.89 as of September 26, 2024? Remember, this could happen because USDC is built on Ethereum’s blockchain network. On August 14, 2024, Circle’s CEO, through an X post, encouraged developers to be on the lookout as USDC payments were set to arrive on Apple devices soon.
Surprisingly, according to Allaire, Apple did not have a direct relationship with Circle – the upgrade was only to help crypto wallets use NFT technology for transactions.
You can actually agree that you do not mind a good experience. And now, with just a simple tap, you will be able to complete transactions and then use the iPhone’s FaceID system to confirm the payment. A blockchain transaction will then be initiated to complete the USDC payment.
According to Allaire, this might be a great direction toward direct-to-merchant USDC payments and other uses. So, who knows? Maybe Ethereum investors are in for a treat.
Possible effects on Ethereum
Near Field Communication (NFC) is a popular infrastructure that has changed how we make payments. You actually can now complete transactions by simply tapping or waving your NFC card at a contactless payment machine. By 2022, the global NFC market had reached $25.8 billion and was expected to continue growing to hit $507.1 billion by 2032.
According to the statistics, NFC already has a growing market. That means that integrating USDC, which relies on the Ethereum network, presents a lucrative opportunity for spreading this network. Try comparing the combined market cap for Ethereum and USDC ($315 billion and $36 billion) with the projected market size for NFC. The difference speaks for itself, right?
As if that were not enough, Juniper Research believes that the global contactless payments market will increase by 113% within the next five years. Incorporating USDC into this framework could capture a considerable percentage of this growing market, increasing the value of Ethereum.
Imagine if the USDC were to only capture just 1% of the global contactless payments that Juniper approximates to be $7.4 trillion in 2024. This could amount to an addition of about $74 billion. Such trends can lead to higher ETH prices, which implies more demand for the network. Just like we have previously mentioned, USDC runs on the Ethereum network, so every USDC transaction will need Ethereum to pay for gas fees.
Other possible consequences
What if USDC transactions dominate mainstream finance? If this happens, it might encourage users to start considering other Ethereum-based applications. According to Yahoo Finance, more adoption of this currency means a long-term value.
For instance, in 2021, the network adopted the EIP-1559, which was to permanently remove most of the transaction fees from circulation. A direct relationship between ETH’s use and supply was, thus, created. When you paid for transactions, the mechanism would play a deflationary role to reduce ETH’s supply while increasing pressure on its price.
Some experts believe that the massive growth of non-zero balance addresses in 2024 is a bullish indicator of the token’s price. Such collaborations could encourage the growth of these addresses, leading to more adoption and demand.
It is possible that other developers could be drawn to use Ether’s network to create more services of this nature. On top of that, CoinDesk places Ethereum’s total value (TVL) locked at $49 Billion. As more Apple users are likely to use USDC payments, the TVL might increase further and position Ethereum for stellar performance in the coming days.
Is crypto the future of mobiles?
Instancy is something that our contemporary world craves for. From payments to entertainment, offering real-time experiences can really help you stand out. In fact, 90% of customers claim immediate responses are very important, according to a recent survey by Help Scout. It is no wonder why companies like Apple are integrating such innovations to appeal to this growing preference.
In a roundtable discussion involving Rob Nelson and Joe McCann, McCan highlighted that crypto adoption will lean towards mobile rather than desktop in the coming years. He added that if Apple and other companies of the same caliber add secure crypto signing, more than a billion people might effortlessly access crypto.
In another place, Solana Mobile confirmed that it will release its Chapter 2 mobile within the first half of 2025. Many people have already shown a growing preference for this phone, especially after it sold more than 30,000 copies in a single day early this year.
Final words
As you can see, as crypto soars in popularity, companies like Apple are taking advantage of its capabilities to enhance their competitiveness. Who ever thought that this could be possible? Picture this: with just a simple tap, you can initiate a USDC payment and complete it with a FaceID scan. And seeing that most people have turned to mobiles, we might see more crypto-based smartphones and innovations emerging in the coming days.
