Bitnet CEO Sees Air Travel as a ‘Great Merchant Category for Bitcoin’

What sectors stand to benefit most from Bitcoin in the near term? When Epicenter Bitcoin's Brian Fabian Crain posed this question, McDonnell highlighted merchants operating in restricted risk categories—precisely where traditional payment rails struggle: "Some of the areas of early adoption could well be tied to places where credit cards just are not working well today for whatever reason. Our focus is that if it's legal in the jurisdiction where the business is being conducted, it's regulated, [and] the merchant [is] capable of complying with those regulations, [then it's okay]." While Bitcoin carries associations with underground commerce, legitimate industries also experience significant friction in processing transactions efficiently. That's where Bitnet sees potential.

Airlines represent a textbook example of payment processing dysfunction. According to McDonnell, carriers occupy a precarious position in the credit card system: "Going back to airlines — sorry to pick on airlines. They're a high-risk merchant. Their so-called MCC — their merchant category code — is high risk because they're [selling] high-value tickets well in advance of providing the service. That leads to a lot of disputes and a lot of headaches. Under the network rules, the card-acquiring banks are the ones responsible for making whole the card-issuing banks on these chargebacks, disputes, and frauds. So, that's a great merchant category for Bitcoin. The airlines get their cash upfront. They don't have to wait for the billing cycle. They don't have holdback reserves — you know, the banks don't crimp their cash through the whole thing." Bitnet has apparently made headway with the aviation sector, as the industry's own payment network, Universal Air Travel Plan (UATP), entered into a partnership with the company earlier this year. CheapAir and Expedia both process Bitcoin, though independently from Bitnet's involvement.

The Bitcoin evangelist takes a markedly different stance on gambling applications. Despite chargebacks affecting online gaming operators, McDonnell identifies money laundering as the primary barrier: "Having said that, McDonnell also noted that anti-money laundering compliance can also be built on top of Bitcoin." Certain sportsbooks like 5dimes have begun accepting the cryptocurrency for wagering deposits.

Bitnet's depth in payment infrastructure positions it favorably as the company pursues its strategy. With a defined approach to scaling Bitcoin commerce, whether the startup can establish itself against established competitors such as Coinbase and BitPay remains to be seen.