Discount airline AirAsia is mulling an initial coin offering (ICO) to help finance its expansion into the financial services industry.
Speaking with TechCrunch, AirAsia CEO Tony Fernandes laid out a plan for the $3 billion company to develop a proprietary cryptocurrency that could replace its current “Big Loyalty” rewards program and serve as a native currency on the firm’s nascent financial services platform.
“We have a product that can be a currency in Big Loyalty, [and] we’re building a payment platform so the two can marry quite nicely. We have an ecosystem that enables you to use that currency, there’s no point having a currency that can’t be used,” he said. “The world is changing so fast but I think we have the ability to innovate and think quickly on these things but the ideas are based on our data and based on our ecosystem.”
AirAsia, which currently has about 65 million customers, believes that expanding into financial services will allow it to crack the 100 million customer mark. In addition to “cashless cabins,” the company intends to offer loans and insurance services targeted at small business owners.
Fernandes said that the company is considering funding this expansion through an ICO since it would mitigate the risks and up-front costs AirAsia faces as it launches the new service.
“I like [the idea of an ICO] because it just takes cost out of my system. So I’m driven, not by trying to take over the world, but in the first instance, everyone buys in my ICO and I take out a lot of exchange risk, I take out a lot of settlement risk, etc etc. So there are many ways of how we are looking at it,” he said.
AirAsia is the latest in a small group of established firms to consider launching their own cryptocurrencies.
As CCN.com reported, Japanese e-commerce and tech conglomerate Rakuten has announced that it will launch its own cryptocurrency to replace its current rewards program, although the company has not said whether it will hold an ICO.
Encrypted messaging platform Telegram has also reportedly raised more than $850 million to build a blockchain ecosystem and may be targeting as much as $2 billion.
Even Kodak — a storied photography pioneer that has fallen on troubled times in recent years — has licensed its brand to an ICO operator that aims to build a blockchain-based digital rights management (DRM) platform.
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Last modified: June 10, 2020 2:42 PM UTC