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Google selects Coinbase to accept cloud payments with cryptocurrencies

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Google Cloud CEO Thomas Kurian speaks at the Google Cloud Next event in San Francisco on April 9, 2019.

Michael Short | Bloomberg | Getty Images

Google said on Tuesday that he would rely on Coinbase to start allowing select customers to pay for cloud services with cryptocurrencies in early 2023, while Coinbase said it would rely on Google’s cloud infrastructure.

The deal, announced at Google’s Cloud Next conference, could be successful in attracting cutting-edge companies to Google in a fierce and rapidly growing market, where Google’s main competitors currently do not allow customers to pay with digital currencies. The cloud business is helping to diversify Alphabet, Google’s parent company, away from advertising, and it now accounts for 9% of revenue, up from less than 6% three years ago, as it grows faster than Alphabet in his outfit.

Coinbase, which generates the majority of its revenue from retail transactions, will move data-related applications to Google from the market leader Amazon The cloud of web services, which Coinbase has relied on for years, said Jim Migdal, vice president of business development at Coinbase.

The Google Cloud Platform infrastructure service will initially accept cryptocurrency payments from a handful of customers in the Web3 world who wish to pay in cryptocurrency, through an integration with the Coinbase Commerce service, said Amit Zavery, vice-president. President and CEO and Head of Platform. at Google Cloud, in an interview with CNBC. Web3 is a buzzword that has become synonymous with decentralized and distributed Internet services that cannot be controlled by large Internet companies such as Facebook or Google.

Over time, Google will allow many more customers to make payments with cryptocurrency, Zavery said. Coinbase Commerce supports 10 currencies, including Bitcoin, Bitcoin Cash, Dogecoin, Ethereum, and Litecoin. Bitcoin, Dogecoin, and Ethereum prices have all fallen by more than 60% in the past year.

Terms of the agreement were not disclosed. But like other Coinbase Commerce arrangements, Coinbase will earn a percentage of transactions that pass through it, Migdal said.

It was not a guarantee that Google would opt for Coinbase for the payments part of the deal. PayPal, for its part, offers businesses a way to accept payments with digital currencies. “We looked at other companies for the cryptocurrency side,” Zavery said. Ultimately, he said, Coinbase had the most capacity.

Google is also exploring how it can use Coinbase Prime, a service that securely stores organizations’ cryptocurrencies and allows them to execute transactions. Zavery said Google will experiment and “see how we can participate” in managing cryptocurrency assets. To block (the payment company formerly known as Square), Coinbase, MicroStrategy and You’re here are among the companies that have added digital currencies to their balance sheets. It can be a risky business. Coinbase announced a $377 million impairment charge related to a decline in the value of its cryptocurrency holdings in August.

Google previously said in May that it was looking into adding support for payments with digital currencies. Migdal said Coinbase has been in talks with Google for months, with conversations about supporting commerce transactions, cloud usage and the Prime service happening alongside. “We decided to bring them together,” he said.

Blockchain technologies such as non-fungible tokens, or NFTs, have become a priority for Google’s cloud division. Previously, Google cloud chief Thomas Kurian pushed for growth in major sectors such as media and retail. This year, he announced the formation of teams to grow blockchain businesses and build tools that third-party developers can rely on to run blockchain applications.

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