On Thursday afternoon, Twitter (NYSE:) launched its new “Tipping” feature, which enables free, instant payments globally for its users. This tipping feature is made possible due to Twitter’s collaboration with Strike using the latter’s API offering. The scalable Strike API runs on Bitcoin’s Lighting network, a layer two solution on that blockchain, enabling instant funds transfers anywhere in the world.

Jack Mallers, Strike’s CEO made the official announcement on Thursday during a Twitter demo of the payment feature. Shortly after Mallers’ tweet went out, Twitter CEO Jack Dorsey confirmed the launch with a simple “100%” emoji stamp as he retweeted Mallers video.

Mallers attacked wire transfer services, and bank wire desks in the video.

Boom. Just a quick, instant, and free remittance payment was made from Chicago, Illinois (U.S.A.) to San Salvador, El Salvador via Twitter. Why would anyone ever use Western Union (NYSE:) again!?! When you take one of the world’s largest social media networks [Twitter] and you combine it with the world’s best open monetary network [Bitcoin], Twitter accidentally becomes one of the best remitting experiences in the world. This one single payment standard, in this one single global monetary network is dematerializing all existing monetary networks,”
said Mallers.

While many mainstream media outlets seemingly downplayed the “tipping” service as a social media novelty, Mallers noted in follow-up tweaks the world-changing implications of this tech.

Twitter has confirmed that the new tipping function for Apple’s iOS users (NASDAQ: iOS) is already in use worldwide. In the coming weeks, Android users will have access to the new tipping feature. Twitter also confirmed that it will not impose any fee or withhold a transaction percentage of any kind on any tip transfers.

This could be a fatalistic disrupter innovation for wire transfer companies such as MoneyGram, Western Union, Skrill, WorldRemit, XE…etc., all of which make money by taking a percentage of the total amount of every wire transaction ranging from 0.5% to 5% depending on what service you use. For a $5,000 wire transfer, your percentage fees would run between $25 and $250 per transaction.

Twitter currently charges $0.00 per transaction.

Wire transfer fees are a common way for major banks to make money. This table is from Finder.com and shows how much each wire transaction costs.

These services are now offered by Twitter for no cost. We’ll see how “Big Banking” responds.

On The Flipside

• This announcement has completely caught the banking and financial services industries off guard. If they had known, they would have tried to stop it by regulation.
• As Bitcoin grows in popularity, this simple and elegant solution to instant, global payments for no cost will result in millions of dollars lost revenue by banking institutions.

Why Should You Care?

While many are dismissing this as just another social media “add-on,” it’s truly revolutionary. Twitter is used by more than 300 million people per month. It’s network effect will spur rapid adoption for this free remittance option, exposing millions of potential users to Bitcoin.

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