Stripe payment service told how it sees Bitcoin prospects

Original author: Greg Brockman
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The Stripe payment acceptance service recently announced the new decentralized currency Stellar ( post on the hub ). Prior to that, an interesting entry appeared on their blog , in which they shared their vision of the prospects for the development of Bitcoin, and also emphasized that they had already developed a system for accepting bitcoins .

Our project on payment systems and cryptocurrencies with the monitoring of exchangers could not ignore such an interesting argument, therefore we publish the translation:

I would like to apologize for the overly optimistic forecast, which may not fully correspond to Russian reality, but let's hope that we will have just that.

Many people say that Bitcoin today reminds them of the Internet at the dawn of its existence, in the early 90s - when there was still no Google, which made the global network open to almost everyone, Facebook and Netflixe, which allowed us to fully use its potential . Thus, you can ask the question: what will Bitcoin look like if it will win the hearts of a wide audience?


Money has three main functions: they are a means of storing value (that is, with what your savings can be represented), a unit of account (in other words, a measure of value), and also a medium of circulation (thanks to which we can transfer value). On the first two points, Bitcoin is a fairly promising system for economies with high inflation , however, if we talk about the wide consumer of more economically stable countries, the situation is somewhat different: the consumer wants to have a place where he could keep his savings. Insured bank accounts and consumer protection standards set an extremely high standard.

However, Bitcoin has great potential when it comes to value transfer. Today it is surprisingly difficult to transfer funds - even though we now have the opportunity to pay for goods via the Internet, which, however, has not undergone much change over the past twenty years. Of course, there are several payment zones surrounded by a high fence (like the App Store or Amazon) on the network, but in general, the Internet is still a dense forest where hunters behind your payment cards are hiding behind each tree.

The transfer of value is even more difficult in those cases when we are faced with the need to transfer funds abroad. A stark contrast to the transmission of information: if you are in, say, Honduras, you don’t need to puzzle over how to get your Internet service provider to send a letter to Kenya. But when it comes to traditional payment systems, it begins to seem that we are back in the days before the advent of the Internet.

And it is cryptocurrencies that are a real opportunity to solve these problems.


If we want to make Bitcoin a really useful tool and at the same time leave consumers the opportunity to think in their local currencies, we should start by creating a series of so-called “gateways” that will allow people to use the network and at the same time not need constant transfers of numbers from one currency to another.

Imagine that a consumer can at any time sign up to use a gateway in his country, bind his bank account to it and make any monetary transactions in his native currency: “send 10 pounds there; or send $ 20 there. ”

Behind the scenes, the following scenario unfolds: when passing the sender’s gateway, the money is converted into bitcoins, which are then forwarded to the recipient’s gateway, where they are converted into the currency preferred for the given recipient.

If such a scheme can be implemented, we will have a reliable system that will interconnect all the world's payment systems. Today, each of these systems performs its function of transferring money within any one country or market, while there is no possibility at all to transfer funds between systems. And if each of these systems starts using Bitcoin (or any other cryptocurrency), we can assume that the appearance of our familiar world will become like this:

One can easily imagine the ecosystem of gateways in which all traditional payment systems will be closed on bitcoins. However, this is very difficult to achieve - this will require a large-scale change in regulatory laws and partnership standards in two countries: in the sending country, in which the person making the transfer feels like a fish in water, and in the receiving country where the destination is located translation and where our fish is thrown to land. A good example: we take the American bank ASN as the final destination, and the Australian direct debit bank as the sender - if we want to transfer money successfully, first of all, we will need to establish relations between these two banks.

Bitcoin at the gateway

One of the interesting consequences of implementing a network of gateways built around Bitcoin will be that they will all be technologically driven companies within an open ecosystem. And of course, each of these companies will want to use open protocols to convey additional value. Imagine, for example, a protocol through which the practice of Internet payments will look like this:

That is, each entity on the Internet will have a billing address that resembles a regular email address. To pay for something on the network, you just need to enter your billing address on the site, after which the necessary funds will be sent from your gateway, and you will receive a notification on the phone.

So, Bitcoin can become an analogue of IPfor money. And in the same way that users select readable names for hosting services and sites that attach to a specific IP address, the new system will use the same name for the gateways ( And at an invisible level, Bitcoin addresses will still be used to communicate with each other (Mike Hearn has a couple of ideas about this).

Ultimately, we will have a global interconnected network that would not replace existing financial systems. At the same time, consumers will have the opportunity to use the same infrastructure that exists today. However, it is worth noting that this will entail a significant increase in the cost of the existing system, by analogy with the fact that when you connect local networks to the Internet, the value of all networks of its components increases.

Unlike other global networks

Of course, the proposed system will not be the first global payment network. Comparison with PayPal immediately comes to mind . But the fundamental difference and advantage of the Bitcoin gateway ecosystem is that it is open. Any closed network by its nature exhausts itself under its own structural pressure, so necessary for its development. Third parties cannot improve closed networks in any way - and even if they have such a desire, they will be forced to duplicate it, i.e. - start all over from scratch. The Bitcoin space, on the contrary, is characterized by constant rapid development and improvement.

Take another global network - for example, Swift. When we send money using Swift, one bank informs the other: “I am going to send you 100 euros”, after which it finds a route through many intermediate banks through which the transfer will be made. At the same time, it is impossible to forget about the need to transfer currency and the numerous fees that are charged for such operations. These are current trends (often simply astounding ). A person should fully understand what happens when he sends his money through one protocol or another - it depends on how clear and convenient the final system will be. The advantage of Bitcoin over Swift is the fact that all “transfers” and transfer fees are initially included in its protocol, and there is simply no need to transfer funds from one currency to another.

There are a number of other cryptocurrencies that already use gateways at the protocol level (these include, for example, Open Transactions and Ripple ), but they are not able to cope with the numerous network effects that cause any payment transactions, and today have not won the sympathy of users.

Comparison with card systems

If we want to make the global network closed on Bitcoin really useful for consumers, it would be logical to compare it with another system that has already been recognized as extremely useful. Talk about Visa . The Visa system has a number of functions that can conditionally be divided into three categories:

  • This is a network that allows money transfers.
  • It establishes its legal framework .
  • And it is built on trust and consumer protection (providing various refunds , blocking stolen cards, etc.).

(Other functions - such as, for example, lending - are carried out more likely by banks than by the Visa system itself).

Of these functions, the Bitcoin gateway network described above includes number 1 and certain technical aspects of number 2 (users know how the protocol works, but they don’t need to maintain confidentiality). However, other features are also very important. The message that Visa inspires consumers is that if they see the Visa logo, they can feel relaxed. But if something goes wrong (for example, you get a defective product), the consumer is simply returned to their original position. This leads to a huge number of transactions, which might not have been and which make the whole system more expensive.

So, when we solve the problem of decentralized reputation (which people are starting to think about slowly ), thanks to Bitcoin, we will have a new type of so-called "Reliable suppliers."

Already, with the advent of the Bitcoin escrow service, you may feel the need for such innovations. However, it should be noted that depositing is by no means the key to trust - rather, it is a way to not have the need for trust. In addition, it only makes sense in relation to a limited segment of purchases and requires strong nerves from you - you must be sure of the quality of the goods before making a payment.

The winners in this situation will be those companies that inspire consumers with confidence in who they work with. They will provide the consumer with various services, such as mediation in reimbursing (which means they will have a direct relationship with the seller so that they can compensate for the reimbursement of the cost of consumers). Thus, they will be associated with all sellers on the Bitcoin network:

Since the main assets of “reliable suppliers” are their brands, which, in turn, depend on the network, the companies will begin to unite among themselves. Ultimately, one or more major players will remain - just as it did in the world of credit cards.

Other participants in the ecosystem, of course, will also want to “highlight” their brands, which will lead to a merger with “reliable suppliers”. Thus, the situation will repeat in which various card systems were forced to integrate with Visa and its issuing bank.

As a result, “reliable suppliers” will begin to build a network consisting of many gateways and trusted sellers. And in order to ensure the legitimate behavior of all participants in the system, they will need to develop and implement their regulatory framework - otherwise, the reputation of their brands will begin to decline. Thus, we return to the world where several players set the rules.


You can ask a logical question: why is all this necessary? There are at least three main aspects that will undoubtedly improve the existing financial system.

  • First, the final ecosystem will be technologically open. This means that it will be able to develop much faster than any closed system. Everyone will be able to join her, start creating good tools and applications on top of her. New regulatory laws , of course, can change certain established rules, but the essence will remain the same.
  • Secondly, this model will divide the existing financial systems into separate levels, which will be managed by independent companies. To understand the significance of this, let us cite as an example the American mobile operators, which in addition to providing communications are engaged in the sale of telephones, the development of mobile applications and operating systems, etc. Each of these aspects is carried out by separate units, which to some extent compete with each other, thereby gaining opportunities for development .
  • And the third: this will be the first truly global payment network: everyone can open their own gateway in their country instead of relying on third-party players in this. This will be especially beneficial for people living in countries with undeveloped banking systems, which traditional payment systems are unlikely to ever get to.

We are at the very beginning of the path, but already now we can see the outlines of the future, which is built on Bitcoin and other cryptocurrencies. And if we do everything right, the lives of billions of people will surely be much better.

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