February 1, 2022
Image: Solana Labs
Good morning, and welcome to Protocol Fintech. This Tuesday: Solana Pay shows crypto payments promise, Diem is done, and Nayib Bukele does some strange bitcoin math.
Diem’s done. It’s probably the most visible casualty of crypto regulation in 2022, but it won’t be the last. After poking the fiat bear for years, crypto is hearing regulators roar. But it won’t be an endless battle: There’s just too much to be gained by merging the crypto and fiat financial systems. Payments is one example, as Tomio relates in his latest look at the progress being made in leveraging the blockchain for transactions.— Owen Thomas (email | twitter)
A new way for people to pay with crypto, Solana Pay, is launching today. It’s one of many efforts to solve the crypto payments puzzle, from bitcoin’s Lightning Network to stablecoins. But Solana believes it has solved some of the problems that have held crypto payments back.
Solana Pay is an open protocol for developers with standardized payment specifications to build on and customize, meaning merchants can connect directly or use software built by ecommerce providers, point-of-sale software makers or payments companies.
Crypto payments haven’t lived up to their promise. Bitcoin and Ethereum suffer from slow speeds and high costs, and can only do a fraction of the transactions Visa and Mastercard’s centralized networks process.
Cash is king — and Solana Pay is more cash-like. It’s not quite equivalent to a credit-card payment, by design. Solana Pay is meant to be a digital version of a cash payment.
Stablecoins play a key role. Shere, who has worked for AmEx and Google, sees Solana Pay as different from other crypto offerings because of its strong stablecoin integration.
Will consumers open their wallets? The direct wallet connections Solana Pay has could lead to new kinds of transactions that merge the physical and digital, Shere said. One example is someone buying shoes with Solana Pay and receiving a matching NFT. Smart contracts could also create offers or rewards that sit in a crypto wallet. That means merchants and consumers will have more incentives to take the plunge in crypto payments.
— Tomio Geron (email | twitter)
A version of this story first appeared on Protocol.com. Read it here.
Honeywell's Chief Commercial Officer Jeff Kimbell sits with Futurum's Daniel Newman to talk through the world's emerging trends in innovation, sustainability, tech and markets. Don't miss the insights into Honeywell's latest strategy for 2022!
On Protocol: Meta has joined the Crypto Open Patent Alliance. Block launched the defensive IP pact in 2020, but the social networking giant brings the largest pool of patents to date.
Looks like wash trading isn’t rare on LooksRare. There has reportedly been more than $8.3 billion worth of wash trades on the NFT marketplace, an astronomical figure for a market that’s only been in operation three weeks. It’s now OpenSea’s biggest rival in the NFT marketplace, but people wonder if an easily gamed rewards scheme is the only thing luring traders in.
Also on Protocol: Bolt’s Ryan Breslow stepped down as CEO after a busy week on Twitter where he went after Y Combinator and Stripe in long threads. Breslow told TechCrunch he is stepping down of his own accord, and suggested he couldn’t have been forced out because of his voting control in the company.
Huawei smartphone users can now use contactless payments. The China-based telecommunications company partnered with Curve to enable its customers to pay by phone through one digital wallet.
Diem is done. The Meta-backed stablecoin project confirmed the sale of its assets to onetime partner Silvergate Capital.
Uquid.com and Binance Pay are offering no-fee crypto purchasing. The ecommerce marketplace will allow users to buy over 40 digital tokens with no additional fees. Uquid also offers “buy now, pay later” with bitcoin.
Visa partnered with Pagaya, a financial ecosystem AI company. The partnership, announced as a “strategic relationship,” will allow Visa to use Pagaya’s technology to increase its customers’ access to credit.
Circle added support for USDC on the Flow network. That means the stablecoin can be used on the Dapper Labs-built system that NBA Top Shot and other NFT projects rely on.
El Salvadoran President Nayib Bukele, who bet his country’s economy on bitcoin, doesn’t seem to understand that the cryptocurrency is divisible. “There are more than 50 million millionaires in the world. Imagine when each one of them decides they should own at least ONE #Bitcoin. But there will ever be only 21 million #Bitcoin. Not enough for even half of them. A gigantic price increase is just a matter of time,” he tweeted.
Former president of Russia Dmitry Medvedev thinks the Russian government will solve its dispute regarding a possible crypto ban — and warned of unintended consequences. “I believe that representatives of the Central Bank and the government of the Russian Federation will deal with this with success. Although, to be honest, when they try to ban something, very often it leads to the opposite result,” he said to Russian publication Tass.
Bradley Tusk, co-founder of Tusk Venture Partners, thinks that policymakers should get on top of understanding and regulating the metaverse early. “We can avoid making the same mistakes we did with Facebook, Instagram, Twitter and social media generally if we can develop an intellectual framework for regulating the metaverse now,” he wrote in a blog post published on the blockchain.
U.K. tech companies doubled the amount raised through IPOs in 2021. The London Stock Exchange showed that tech companies raised $8.8 billion through listings on the market, twice 2020’s haul. British government officials are optimistic about tech offerings in 2022.
Scratchpad raised $33 million. The data startup’s series B funding round was led by Craft Ventures, with participation from Accel.
Negotiatus raised $30 million and renamed itself Order. The guided B2B marketplace’s series B round was led by Stage 2 Capital with an investment from MIT’s Endowment fund.
BCB Group raised $60 million. The London-based digital asset financial services company held the largest series A round in the U.K. blockchain industry, co-led by Foundation Capital and Backed VC.
Colizeum raised $8.4 million. The latest funding round for the maker of blockchain developer tools for mobile gaming and esports was led by Deribit, with participating investors SevenX Ventures, Axia8, LD Capital and Genblock Capital.
Thanks for reading — see you tomorrow!