The Challenges and Potential of Crypto AR & AP

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Rafael Casas: [00:00:05] Welcome to crypto with accountants powered by Bitwave, where we talk with technologists and crypto enthusiasts as we discuss current events in economy, politics, technology and digital assets with thought leaders from around the world. Today we have a brilliant guest and someone who has an immense wealth of knowledge in the Web3 industry. Welcome, Eleni Steinman. Eleni is the co-founder and CEO of Loop Crypto, where she is enabling Autopay and Web3 Loops Suite of APIs, tooling and smart contracts make it simple for businesses and projects to receive and send crypto payments on an automated basis. She and her co-founder, Shane Van Coller, founded Loop in 2021 to solve the challenges of on chain recurring transactions. Loop is backed by premier investors, including A16z archetype A, Capital, Alchemy Ventures, Coinlist and a dozen of angels who are building and founders themselves. Eleni, thank you so much for being here. It's such a pleasure. And we just are really appreciative of what you're doing in this space and helping to build the community. So thank you so much for being here.

Eleni Steinman: [00:01:12] Yeah, thanks for having me. I'm really excited to chat about payments.

Patrick White: [00:01:15] Yeah, we love we love talking about payments. And we've been seeing a really big uptick this year in payments moving over to crypto and we'll I'm sure we'll kind of get to that. But where we always like to start these things out is tell us a little bit about yourself. You know what, where do you come from and how did you end up getting into crypto?

Eleni Steinman: [00:01:32] Yeah. So I probably have a little bit of an unlikely path into crypto. I used to work at the federal government and I did trade finance. I spent about six years there and really enjoyed my time but wanted to get into the private sector and work in fintech. So I went to business school at Yale where I discovered crypto and I just knew it was the industry I wanted to be in. And this was almost six years ago now. Got a job in Chicago at a company that was originally focused on scalability. Now they do like trading defi trading tools. And that's where I met my co-founder, Shane. And it's also where we saw this first problem of crypto being. So when we left, oh.

Patrick White: [00:02:19] I was just going to say, how did so so let's, let's start a business school there. Was it a class that introduced you? Was it just trolling Reddit? Like what? What got what what what piqued the curiosity?

Eleni Steinman: [00:02:29] I think so. I knew I wanted to work in startups and my background was finance, so I was looking for fintech startups. I bet you I just googled and found the Bitcoin whitepaper on Reddit. And then I found Princeton had put out these textbooks on cryptography and like explaining how blockchains work, and they were honestly wonderful and I just spent like hours reading them. And they had some videos too, at the time. And I sort of knew like if to me it felt like this is the Internet, you know, 20 years ago and here's my chance to get in at something like pretty early, that could change the way people interact with each other.

Patrick White: [00:03:11] Yeah. And anything in particular piqued your curiosity? I mean, did you like did you like the peer to peer nature of it? Did you like the because when you got into it was sort of defi was defi around. So did you like some of the defi stuff?

Eleni Steinman: [00:03:24] This was before defi really. Actually, the thing that got me excited was owning your digital identity. So these ideas of like, you know, instead of having like walled gardens of companies sort of know who you are on the internet and that leads to, you know, monopolies and oligopolies. And now there was this technological threat to that where you could own your online identity. And so companies actually had to compete on providing you the best experience versus like knowing the most information about you. Yeah, like the Blockstack days.

Patrick White: [00:03:58] And we're really only just starting to see that come to fruition. It's been it's been one of those long time promises of crypto is this idea of owning your data, owning your identity, getting to sell it. And we're just now starting to see really interesting stuff happening around medical. Like people have been trying to kind of turn this into a into owning your DNA and being able to, to grant access to it. But the place that we've been seeing it a lot is in the gaming space where you can do this. Really it's it's this really interesting flipping of the world to go from like me, as me as a as a product, individuals as products to this idea of like, hey, you know, you can see me playing a game if it's an on chain game you can watch my address playing that game and then you can now actually do analytics around there to see what are the games that I play. And competing game providers can actually start airdropping you tokens or inventory items or whatever it is. And this idea that it's sort of like this idea of flipping the flipping the conversation of me as a product that people sell the data on to me as as the owner of my my activity. And I'm just getting sent up to kind of. Ward me for it. It's a really exciting part about this, but kind of nascent.

Eleni Steinman: [00:05:04] Yeah, I definitely agree that like there's a lot of infrastructure to get built for. The Promised Land is there. But I mean, just the fact that you have a wallet and you can take with you your wallet to every single dapp and a lot of these dapps then need to compete on like a feature set I think already is just a huge improvement to the web world.

Patrick White: [00:05:25] Yeah. Okay. So you ended up at a at a company doing scaling scaling solutions and I think some trade, trade, routing stuff and things like that, if I remember correctly. So then what, what got you excited to go strike out on your own? So it was a hard question.

Eleni Steinman: [00:05:40] I think starting a company is something I always wanted to do and it was definitely on the back of my mind. But I mean, quite frankly, I owe a lot to Ash Egan at Archetype. He's I've known him for a while and we were chatting about like, what my next step would be, and it was almost his idea that I should leave and start something. And he was happy to see Shane and I as a team because he'd known both of us for a while. We built products together before and launched it successfully, and it was, you know, sort of a dream come true in that sense.

Patrick White: [00:06:12] But yeah. So how did you end up on the payment side? I mean, what give us the, you know, every, every founder always has the story, the Genesis story. How did you how did you end up on payments?

Eleni Steinman: [00:06:24] Yeah, because of how we got started. It gave us space to sort of take a step back and say, okay, like what are all the problems we've personally had in crypto that are big enough to solve that we're the right people to solve? And we, you know, we went through a bunch and we landed on payments because it was actually a problem we had at our old company where they were trying to charge Defi traders a crypto subscription and every month you had to go to the customer and say, send me money. And obviously that leads to high churn. There's also a lot of difficulties around metadata. Someone just sends you money to your wallet and you don't know who it's from, right? You've got to like go and track it down. You need to put it in your accounting systems. And we realized that the missing feature is something we all take for granted, which is autopay, right? You just give Netflix your credit card in every single month it gets charged and it just works. And so we set out to solve that problem from the premise of like payments are never going to be a thing in Web3 if we can't at least have feature parity with Web2. And this is like a key feature that both companies and end users require.

Patrick White: [00:07:38] Now what ends up being sort of interesting about that, of course, is that as soon as you start looking at that, you're you end up being faced with a lot of questions about, well, centralization. Like how you actually go and implement a recurring payment model is always a really tricky. How did you guys approach that from kind of day one? Did you take a real hard stance of, you know, decentralization has to be step one for everything and then and then go from there? Or were you did you actually go through looking at centralized models on decentralized models, all that kind of stuff?

Eleni Steinman: [00:08:04] Yeah. So we take the premise of like, what are the killer features of crypto that we wanted to preserve, and to us that was self-custody inter and interoperability. And then on the spectrum, giving people the option to choose their spectrum of decentralization, because you can see in web3, like as it is today, depending on what application you use, there are points of centralization. But the important thing is you as an end user can choose how much or how little of that as you want. And so we built the system to be extremely flexible and in the end, actually end users have way more control than you would in Web2. And one of the most obvious ways is you can actually control how much a company is allowed to interact with your wallet. Right? And web2 you give someone your credit card and they can just charge it like there's absolutely nothing you can do in Web3 you can set like actual dollar limits of how much a company can interact with your wallet. You can revoke it at any time and basically cut off that company. And that puts a lot of power back and control of the end user that you didn't have before.

Patrick White: [00:09:19] And are you are you guys focused only on Usdc and Stablecoins? Do you cut across the entire spectrum of Stablecoins to to base tokens to any, any, any single token you want to pay? How do you think about that? Yeah.

Eleni Steinman: [00:09:33] So any erc20 token works with our deck. For the most part, companies and end users, especially in down markets, want to pay in Stablecoins. But we're agnostic. We really built the system to be sort of plug and play. You can take if you want to take like Pepe, you can accept Pepe the token if you would like and if you want Usdc like you can accept Usdc.

Patrick White: [00:09:56] And then how are you also then the other side because I and I know we, we talked about this. A little bit while we were steady up here is is this idea of of the off ramps here. So I assume that part of your world is really thinking because you guys are all end to end crypto, is that right? Like you're really full, full crypto up and down the stack, right?

Eleni Steinman: [00:10:14] Yeah. So the premise that we're taking is right now at the stage that crypto is in, the people who want to pay in crypto, live and breathe in crypto. And this sort of goes back to where the idea came from of like someone who's a defi trader that earns in crypto, probably doesn't even live in the US, so has trouble accessing dollars they prefer to pay in crypto because it's just it's a better rails for them and we're building loops so that in the future when crypto becomes more prevalent and there's more tooling, maybe you are paying Netflix with us and you as an end customer just don't know that. And so with, with that frame, we stick in the crypto to crypto realm, but we partner with off ramps or even on ramps when. Well, I.

Patrick White: [00:11:01] Was just going to ask you, so yeah, so what are your who do you tend to partner with? Because I assume most of the businesses that you deal with do need to off ramp at some point. You know, we're still in that world where you can't you can't pay your bill with crypto yet, so there's an off ramp. How do you how do you who do you guys partner with? How do you think about that off ramp, that off ramp cycle?

Eleni Steinman: [00:11:19] So a few things. First, we let you send money anywhere you want. You just need to give us an address on the same chain. And so a lot of people just send it to an exchange and that becomes a de facto offering. The second thing we do is we'll partner with companies like Ansible Labs so they help you convert immediately into fiat. Or if you're an individual, you can use a company like Parallax. They'll help you again convert directly from fiat to crypto or sorry, from crypto to fiat, but it's up to the end customer to decide where they want their money sent. And what's the best way.

Patrick White: [00:11:57] Do you think? Do you think there's still a lot of friction there? I mean, that's it's one of those things that like if you're if well, maybe Walmart is a bad example, but maybe a little a little store mom and pop store in a tourist area or something like that, you know, they might not be comfortable with exchanges. I mean, how do you think there's still a lot of friction on the on ramp and off ramp side? Or do you do you guys kind of think that that's a solved problem? That's why you're not you're not really touching it too much?

Eleni Steinman: [00:12:21] I actually think it's more of like a timing of where the industry is. Question Right now, the people who want to accept crypto do so because their customers live and breathe crypto and they're not as like maybe even eager to turn it into fiat. If you accept usdc for the most part, like you're comfortable just keeping us on your bElenice sheet because you might also be paying for things in crypto in the future. You know, one day when crypto is the payment rails, then yes, like we probably need cleaner and easier onboarding and offboarding solutions, but in my opinion that's probably like five years away.

Patrick White: [00:12:59] Yeah. So let's, let's get into talking about loop a little bit deeper here. So what, what chains are you guys on and what are you, what are you seeing in the, in that side of the space You've seen really high demand for particular L2's are you on l1's Like what's what are you seeing from like the technical base platform side?

Eleni Steinman: [00:13:17] So we're on Ethereum, Polygon, Arbitrum and Binance, and we're going to launch on optimism in the near future. Basically, we're compatible with any chain and we'll go to a chain if we have a customer large enough that demands it. In terms of activity, we are seeing more more customers move towards L2, especially as bridging becomes easier and the sell off on Ethereum.

Patrick White: [00:13:45] In which and when you guys are thinking about L2, I mean, do you have strong opinions or you're just you're just following your customers?

Eleni Steinman: [00:13:51] We're just following our customers.

Patrick White: [00:13:52] Yeah, yeah, yeah. Which is always fun. And what do you and so then what do you what kind of stuff are you supporting your customers on doing? I mean, is it is it all subscription payments? Are you guys seeing more metered payments like, you know, like AWS or something like that? Like metered payments on that side? What's the what's the state of the art here?

Eleni Steinman: [00:14:09] Yeah. So? Well, okay, there's two use cases. One is getting paid. So the subscription payments are one time payments we also support. And then another use case that we support is paying contributors or paying others. And we solve sort of the multi-sig coordination problem, which I can talk about in a second. But on the getting paid side, the way that we've worked is really at its core where payment processors. So you tell us how much you want to get paid and then we process it on chain, which means if you're doing something like metered billing, you can use any system you want to calculate that bill and then you tell us and we process. So something that we're actually excited to announce, we'll probably announce before this gets released, but we're announcing it in two days is an integration that we have with Stripe, which essentially you can use Stripe as your front end, so you can use them to collect fiat, but also use them to collect crypto via loop. And the way that works is we essentially through API keys, we pull in your plans to our systems and then when Stripe creates an invoice, we just take that invoice and convert it to like loop's version of an invoice and process the payment on chain. But by doing it that way, Stripe is creating an invoice based off a metered plan. Then we can also just automatically bill based off that plan.

Patrick White: [00:15:32] And I assume that a lot of people were asking for that because there's still most most of your customers are still in a world where they're accepting both credit cards and and crypto, and they just want to kind of tie it all together nicely.

Eleni Steinman: [00:15:43] Yeah, for the most part, what we see with their customers is they'll start with fiat because that's what they know best and then all of a sudden they have one customer that wants to pay them in crypto and maybe they showed them a wallet address because it's fast, but eventually why you get by the time you get to 5 or 6 customers, you're having this problem of following up with them every single month, making sure that they're paying, tracking on the metadata, making sure it goes into your accounting system, and then they tend to find Zoom and they can either onboard natively with our front ends. And now with this integration with Stripe, it should be even easier to use us.

Patrick White: [00:16:19] Yeah. Wow, that's that's really exciting. Did you guys build that entirely or did you guys get support from Stripe on that? Like, do they actually.

Eleni Steinman: [00:16:26] So we are in contact with the team and, you know, chat with them. But we were able to do it as is given their current architecture.

Patrick White: [00:16:33] That's really that's really cool. Yeah. I'm just, you know, stripe stripe compared to someone like Square has, has been a little bit slower on the crypto side. So I think we're all kind of like, I wouldn't say excited, but we are all kind of watching to see what Stripe eventually does in the in the industry here.

Eleni Steinman: [00:16:49] Yeah, I mean, our technology is really crypto native and we think and actually even from talking to the Stripe team, they seem to believe as well that a team like ours is best positioned to solve this problem because we live and breathe smart contracts and the crypto community and sort of know the players in this space well. Stripe is huge and probably has other things going on.

Patrick White: [00:17:12] They got they got a few things going on right now, although it is I mean, it's interesting because, you know, done right this is very disruptive like to both like Square and Stripe's business potentially. These things are very, very disruptive this and that's that's sort of what I love about this is the idea of that that 2.5% kind of tax that the credit card companies sort of extract, like getting that back to individuals. Man, it's money you basically get to keep in a in a in a roundabout sort of way, right?

Eleni Steinman: [00:17:38] Yeah. It's a yeah. A credible threat to what has been a monopoly for a pretty long time.

Patrick White: [00:17:43] For a very, very long time here. I want to step back really, really quickly here and talk about something from your past that I'm kind of curious because. So you're at the the import export bank, the US or export import bank in the US here, which must have been a fascinating job. Like it's got to be really interesting. Did that does that make you think did that does that actually influence how you think about crypto payments? Because I mean obviously that was an incredibly complex that bank in particular runs an incredibly complex multi-layer, I'm sure. The different banks. They interact with payment rail system and the and like what they're actually paying out to and all the lending they do. Has that influenced how you think about crypto or your mentality there?

Eleni Steinman: [00:18:28] To be honest, not until you asked me. I think for the most part, when I think about like legacy systems and how do you bring them to modern times, I think about you probably need a technology that is like 100 x better to make it worth the pain because there's nothing worse than doing like a systems upgrade. And I do believe like blockchain and crypto and the excitement around it probably is has been or is the best position to lead to that overhaul. But it's going to take a really long time and it'll probably take like a, you know, the federal government needs to be more supportive of.

Patrick White: [00:19:11] Supportive at all. Yeah.

Eleni Steinman: [00:19:14] You support at all digital payment rails. But I do think it can help a ton.

Patrick White: [00:19:20] Are you. So speaking of that, that's super interesting. Are you seeing pick up I assume you guys work all over the world or are you focused on the US markets?

Eleni Steinman: [00:19:29] We're global, but I would say that we are focused mostly on crypto markets.

Patrick White: [00:19:35] On the on US markets. Or do you see like are you guys seeing big international demand right now?

Eleni Steinman: [00:19:42] Yeah. So a lot of our customers customers are international, so a lot of the traders tend to live somewhere else. Or if you're a Dao that's using Loop to pay your contributor for the most part, you're probably paying someone who's outside of the US, right? Your incentive to use, you know, nontraditional rails increases when banking makes it difficult, right?

Patrick White: [00:20:07] When you guys think about product, is there anything that you do that's more focused for the global markets or like the example I'll give and this is I was sort of poking at it earlier when we're talking about the l2's, but like if you're doing a lot with payments around, let's say, Argentina, you know, a dollar for fees in Argentina is whatever that's 1 to 2% of your of your monthly take home versus a dollar in fees in America is is 0.001% or something like that. Like do you guys tend to see different requirements, different demands from international customers in that way?

Eleni Steinman: [00:20:39] It's something that we've definitely like heard about from companies that want to use us, but it seems like there's missing pieces of the infrastructure, especially at that like last mile that hadn't been built yet. But it is something extremely bullish about, especially sort of like paying contributors or paying workers in other countries. Just cross-border payments really sucks. Yeah. And crypto is well positioned to solve that from a technical perspective.

Patrick White: [00:21:08] Yeah. I mean that's we're all, we're all really excited about that piece of it. And this idea of banking the unbanked, it's how a lot of us ended up getting into crypto in the very beginning is this idea of, of democratizing access to financial services. But then you do run into these interesting questions of like, well, if you're paying, if you're paying, you know, right now eath, gas is is incredibly high because of the pep launch. So you are seeing these like 5 to $20 fees, which essentially would be unusable if there's any sort of like fee component when you're receiving funds. And I it'd be good to hear if you guys if that is required or how you think about that but it does it does limit the the geographies and the world that you even could think about operating because that's so much money in some parts of the world.

Eleni Steinman: [00:21:49] Yeah, I think for the most part, if your end user doesn't demand being on Ethereum, you probably just don't use Ethereum.

Patrick White: [00:21:57] Like you probably don't want to be.

Eleni Steinman: [00:21:58] Yeah, yeah. Are you use another one that has lower gas because the large majority of the world, 99.9% shouldn't know or care what the rails are of what how they're getting paid. Just like, yeah, most of us have no idea how the internet works when we're using it every day. Yeah. And so that is the promise land that we're building for, but we're not there today. And so our view is to build a product for the people who are using crypto right now, but build it in a way that is flexible enough to meet the needs of like the next billion that get into crypto.

Patrick White: [00:22:33] Yeah, absolutely. Are you seeing demand? So do you guys offer a streaming, a streaming product or is it all kind of discrete discrete payment points?

Eleni Steinman: [00:22:43] It's discrete payment points. I have a soapbox about streaming.

Patrick White: [00:22:46] I'd love to hear it because we've had people talking about streaming at our conference. We did a panel, we had the superfluid guys on it to talk about streaming. It was it turned into some great discussion because some of the folks hate streaming. Some of the folks love it. And it's it's one of those things that I think was it's one of the promises of crypto is this idea of having streaming payments or being able to sort of do payments differently. But I'd love to hear your soapbox.

Eleni Steinman: [00:23:13] Yeah. Okay. A couple. Things like first think streaming has. There's probably a very narrow use case that it's really good for. And think over the last few years, people were experimenting to figure out what those use cases that use case was. And so of course, there were instances of where it didn't play out to be the best solution. But the biggest issue, at least that we see with streaming is that you don't actually stream anything. You move money into a contract and then someone else has to pull the money out. Right. So there's nothing automated about that process. It's you're constantly pushing and someone else is constantly pulling, which means you need to make sure the contract has enough money. The second biggest issue is you're fixing the exchange rate at the time that you're moving it in. So if you want to get paid in anything aside from a stablecoin and you price it in dollars, you run the risk that at the end of the stream you didn't actually get the dollar amount that you set out to create. And that can create a lot of issues, especially for an employee, let's say, who really depends on, on the end of the day, making $1,000. And if they're getting paid in week, they could end up with $800. And so I think there are use cases where streaming makes a ton of sense. But in terms of something like a subscription where it tends to be the company that chooses the payment frequency and it's the company also has the power. So they just rather you pay every month. It helps with their accounting, it helps with their forecasting. They rather book the entire amount, then run the risk of you like turning on and off the product as you use it, right. Because of how streams work. So at least for the segment that we're going after.

Patrick White: [00:24:56] Interesting. So first of all, like we can do kind of discretized handling of streams so that part you can handle it if you're doing daily, weekly, hourly stream recognition and a lot of folks are doing streaming are working with like usdc and stuff. But the part that's actually super interesting is that like just because you're using streams or not using streams, accounting for this stuff can be very complicated no matter what. Like whether you're doing, if you're using eath, even if you're getting paid, that itself is incredibly complicated because you still are picking up an obligation when you sign the contract. That then has to have a forex adjustment overlaid on top of it. So no matter what, there's complexity that comes into the into the world. And any deferred revenue you do from a subscription model, especially if you're actually pricing out an eath, the accounting side gets very, very complicated no matter what you're kind of doing in this space here in an interesting kind of way, I think.

Eleni Steinman: [00:25:45] Meant more like a lot of the ways that companies operate is, you know, they open an invoice and becomes account receivable and then you get paid and then they close it and that becomes muddled when you're doing streaming versus again, you're probably accepting both Fiat and crypto and you don't necessarily want to build out entire new systems just for the crypto.

Patrick White: [00:26:06] So yeah, yeah.

Eleni Steinman: [00:26:07] Is at least in this moment, we should meet people where they are to help encourage them to adopt crypto.

Patrick White: [00:26:14] Yeah, super interesting. Do you see, do you see big differences between because you guys do both the payment so the AP and the AR side so receiving payments as a company and then paying out. Tell me a little about about the different challenges you see between those two sides of it, if that if that question kind of makes sense. But I assume they're they're pretty different models like paying bills and getting paid are pretty different models.

Eleni Steinman: [00:26:38] Yeah. I mean, is more of an internal challenge. We have to think of how to structure not only our front end and our back end, but do it in a way that was flexible enough to handle both directions, but also simple enough that someone knew how to use it and could like triage into what solution they wanted. And that, quite honestly, has taken a lot of iteration and just great feedback from customers in the the biggest use case for the paying out that we see is we solve something called the state coordination problem, which is basically you have daos or even companies that have authorization to pay. So they've already gotten the approval from their community to make discreet payments over time, but still have to coordinate those payments every month. And it could be they're paying ten people a month for six months. And so if it's a three of five mean you're talking about a lot of signatures that need to happen.

Patrick White: [00:27:41] Yeah, it's 30, 30 signatures a month from 50 people that you're bugging for signatures. Interesting.

Eleni Steinman: [00:27:46] Yeah, exactly. And so if you use our system, what we do is we allow you to give the authorization up front for all six, let's say, of those payments, you know, six states for ten different people. And then we can layer on web2 control. That don't have to happen on chain. So you could still have a user flow of like this person needs to tee up the transaction, this other person needs to check it. But there's flexibility there. Or two. You can change out who has to chuck it. You can make transactions sort of happen in parallel. When you abstract away, pretty much, you know, working with smart contracts and using them at the key moments that it matters when you want to collect that authorization, then I think you can just do a lot more things with blockchain.

Patrick White: [00:28:37] Yeah, super, super interesting. Yeah, that is that is a really interesting challenge when you get to some of these big daos like that, that is really interesting. How do you guys think? Because you must have a pretty good set of APIs for developers to. So if you're, if you're doing a recurring payment, you need to be able to make sure the payment went through in order to keep service up and things like that. So I assume you have all the APIs for that kind of stuff.

Eleni Steinman: [00:28:58] Yeah, so we use webhooks, so we'll let you know that something got paid on chain with a webhook because it's crypto you don't even have to like you can just monitor the contract yourself and see that it got paid or, you know, monitor the mempool. But yeah, we do use APIs and webhooks and a lot of web2 tools so that companies can take those onchain payments and permission people into their system. Actually, relatedly, something interesting that you can do with Loop is you don't even need to build out a permissioning system. You could use sign in with Ethereum. So if someone pays on chain because that transaction exists on the blockchain, then you could build, okay, well, if this wallet has paid us, then when this wallet signs into our dapps they get access.

Patrick White: [00:29:46] Right? Cool. So you actually have the contracts you set up actually have like callable callable interfaces to check payment status.

Eleni Steinman: [00:29:54] Yeah. Yeah. Mean you don't have to ask us for permission. It's public.

Patrick White: [00:29:58] Yeah. Yeah of course on that side. But it is, but it's, it's it's done in a way that you're not having to like index a bunch of transactions. Like there's just a, a simple smart contract call you can make to kind of check it out.

Eleni Steinman: [00:30:10] No, I think you would still need to use.

Patrick White: [00:30:11] Okay. So you track, you track through the index, you track through all the transactions. You have it there. Yeah. No, it is. It's the public nature of stuff. Makes it really, really interesting. Now, speaking of that, though, the next topic I would bring up would be, are you guys seriously thinking about or how do you think about the totally public versus obfuscated and what's going to happen in that that part of the world?

Eleni Steinman: [00:30:34] Yeah, I mean, there are more privacy protecting blockchains that are coming out and I think those who really care about privacy will opt for those blockchains and use us, you know, in that way. And in the same vein, I actually think sometimes people want to see the transaction. And a good example again is daos, right? Like you have this community that you want to show you're actually using the money as though you said you would. And so the fact that it's public is extremely important. Yeah.

Patrick White: [00:31:05] No, that's and it's a great feature of crypto on that side. But then the other side of that of course would be, you know, let's take Walmart because I always I'm excited for the day that Walmart starts taking crypto. They, of course, you know, A, they're a public company. There's a lot of different reasons that they have to be incredibly careful about any sort of anonymized revenue data. So for instance, like if you were actually tracking them to see how their sales are, you know, in this, in this future perfect world where everyone's using crypto, if you're actually have all of your crypto, your transactions on chain and someone can figure out what your address is, your smart contract is, suddenly you've given a lot of information to your competitors, to the analysts, to stock traders. There's all this other stuff. Have you guys heard? Do you guys get that, that objection a lot or is that just not coming up yet?

Eleni Steinman: [00:31:53] It hasn't really come up, to be honest. For the most part, people want to get paid and those living and breathing crypto have sort of accepted the public nature of it. And like I said, sometimes lean into it. But in the future, you know, I do think there are solutions to this problem that will allow companies to hide transactions where they need to just deploy many contract. Or again, you could use like a rollup that has some sort of anonymity to it where it becomes much more difficult to track who's getting paid and what they're getting paid for.

Patrick White: [00:32:28] Yeah, well, it's something that we think about just because we tend to work with a lot of auditing firms and things like that. And that ends up being a really interesting question of like because there are limitations to releasing your revenue data if you're a public company. So like public companies have an expectation that they're not releasing data or if they are releasing it, they're releasing it universally as part of their their public proceedings. And that then makes the blockchain really interesting. If you are if you do have that as a major revenue or expense stream, that suddenly you are potentially releasing data that you shouldn't be releasing and things like that. So I mean, I think someone's gonna have to come up with with some solutions around here and that could just be using zrx and things like that. But it is, it's a question we hear quite a bit from the big enterprise customers that we deal with.

Eleni Steinman: [00:33:10] I mean, another solution could be like Walmart has their own blog. That is not super, is not public, but you can easily bridge into it. Yeah, I could eat my money on one chain natively bridge to theirs. It's actually a private blockchain, but then it gets you pay.

Patrick White: [00:33:27] Yeah. Yeah. Some of the cool stuff that's happening, like in AvEleniche with the subnets and being able to actually overlay, you know, have really easy bridging, but then be able to overlay that with like different considerations like privacy and stuff like that. What else, What else is getting you excited about crypto right now? So besides besides moving a little bit away from payments, like what else are you loving in the crypto world right now?

Eleni Steinman: [00:33:45] Yeah, I think a lot of the creator economy things I find extremely exciting. Yeah, we chat with a lot of platforms that are trying to disrupt, like the Patreon of the world and, you know, Twitch, who take like 50% of the revenue from the creators and they can do that because they have this platform that and we're really excited to see that also get disrupted.

Patrick White: [00:34:10] Yeah, I 100% agree because it is crazy between YouTube's twitch, all the different guys that are out there, even Kickstarter, the fees that they take are are usurious at best. And that just gets back to this idea of of kind of like self-determination for your finances and this peer to peer, the peer to peer model around all this kind of stuff. Are there people working? I actually haven't seen is there someone working on a on a really cool, decentralized twitch competitor?

Eleni Steinman: [00:34:35] Yeah, I don't know. But videos in particular. But like one company we're working with is called Bonfire at X, Y, Z. They have a creator platform that helps you manage your community. Another one is.

Patrick White: [00:34:49] Kind of a little bit more like Patreon in that way. Like it's a community management and you subscribe to like be part of the community there.

Eleni Steinman: [00:34:55] Exactly. Yeah. They, they help communities manage their communities.

Patrick White: [00:35:01] I love it. Yeah. Well, it was also it was one of the big themes at GDC. So we always go to GDC every year. And one of the big things at GDC this year was Creator Economy. Now this is from a gaming perspective, but you know, Unreal is big announcement was all around tools for, you know, people to create their own games and then sell them That was the same, you know avEleniche and Polygon were both there talking about their side of it. But it was one of the major things GDC is this idea of of giving tools to creators to create on the platforms. And crypto just fits in that world so nicely because then you're again, you're paying peer to peer, you're cutting out the middleman. A lot of those cases, good economic unit economics on it.

Eleni Steinman: [00:35:40] Yeah, no, definitely. And you know, the whole idea of art is, is about building a community and crypto is set up to benefit those who build community as well. And so yeah, like a place for them.

Patrick White: [00:35:53] Yeah, it's, it's really true. So okay so I love it. So creator economy stuff that's a great that's a great answer to the to the question there. What do you see as some of the challenges. I mean we always talk we always talk about user experience as a continued challenge in the space. But do you think that that's getting solved or do you have other big challenges that you're you keep your eye on?

Eleni Steinman: [00:36:14] I sort of have two of two minds of this. I actually think down markets are like the best time to build. There's just less noise. Most people in the space are really committed to it. And you kind of get that, like, I'm gonna say, free space to really build a product for like your power users who are still here. But the flip side of that is I do think a lot of people got burned like not crypto native people in the last bull run, especially those that were playing in Nfts and were excited about artists in the space and it could be difficult to win them back. And so I see a big challenge is a lot of the technology and more of a social issue of like, okay, how do we communicate to those who don't live and breathe crypto that there is value here and they should give it another shot?

Patrick White: [00:37:06] Not not everything's not everything's a scam. Yeah. No, but then of course we go through these moments like right now, which is like, you know, with the gas and for these on these kind of meme coins like I for one was of the mind that meme coins were officially dead. They got deaded after like 2020 and there was just no bringing them back. And yet and yet here we are with another big meme coin coming out. So I guess I don't know.

Rafael Casas: [00:37:34] Well, one thing I did have a question for you is we do see a lot of these traditional firms and accounting firms and customers, they're having their clients talk about, you know, receiving payments in crypto and trying to figure that out. How do they how should they be talking to their you know, that they don't really have a ton of knowledge on this. What are the good questions? How should they be talking to their clients about this on the crypto payment side?

Eleni Steinman: [00:37:56] Yeah, I think I mean, the first obviously this is pretty biased, but the biggest pain point that we see with folks in receiving crypto is the lack of metadata. So what happens is you end up spending sending for your account and a ton of money to track down a transaction and figure out like who paid you and for what. And the benefit of loop is that that metadata is just natively there because it's a pull. We know exactly what it's for, who it's from can tie it to a product, and then you can write rules in your accounting system essentially to just save you a lot of time and quite frankly, a lot of money in that vein, I think something that we tell our customers to do is to set everything up right at the beginning, you know, like have one wallet and that's where all your money goes and have another wallet. And you use that for all of your costs and another wallet that you use when you're going to deploy contracts. And so then, you know, if anything happens in those wallets, exactly what it's for. And so it's, I think, maybe a little different than traditional accounting where you can like let things burn for a bit and then pay an accountant to come in and fix in crypto. The the price tag to fix is just so big and the amount of time it takes to just set it up correctly in the beginning is so little. Actually just on our business team wrote a blog post about this just like five little tips that you can do now to save yourself a headache later.

Patrick White: [00:39:29] We've got a couple of blog posts like that as well. We call it we call it wallet hygiene. And actually we would go further because we actually usually recommend that you separate out even your revenue streams. So you don't just have one wallet for your, for your for like all revenue. You break it down by product or anything like that. I mean, it depends a little bit on kind of what your practices are and how good you are with crypto. But even if that's, if that's A exchange deposit address or an actual physical address or a gnosis vault breaking it down by revenue stream and breaking your and then having kind of a couple of different expense wallets you spend out of makes your life super, super easy. And then obviously yeah, we have a full rules engine to be able to do categorization and all that sort of stuff on on that side. It is a it is a tricky part of the of the whole industry here. It is an interesting it'll be interesting to see as that how that kind of grows up, you know, whether that ends up being, you know, what you're talking about, which is sort of pulling the metadata in at the payment level. If we start to see more kind of stuff like different types of of nfts that are used for identity. Was wrapping this conversation back to where we began here is, you know one of the ideas you also could do is having nfts that represent your identity so that that could then get surfaced up in terms of when you're paying people out. That of course is then ties back to this idea of of then the obfuscation and whether or not that's, you know, how sensitive you are about people seeing how much money you spend every month or how much money you make every month. But it is it is a really interesting overall conversation around around this stuff.

Eleni Steinman: [00:40:58] Yeah, Yeah. My answer there is like I think people use they want to flex in the digital world, sort of like flex in the real world and where maybe you would buy like a fancy bag or a nice car to sort of show your status. Like in crypto, you buy your right as sort of a way of signaling your in certain communities or you buy an NFT as a way of signaling. So I do think just with time people will figure out and they'll be better established, you know, sort of norms about when you hide something and you private data and when you want to show the world something about yourself.

Patrick White: [00:41:36] Yeah, yeah, absolutely. It's it's I mean, it's always, of course, a bElenicing act because you mentioned daos and we, you know, we also work a lot of nonprofits, which is again, that same thing where like it's the pinnacle of transparency to see where every single dollar is flowing. I deposit a one usdc and I can kind of track that all the way through to it. Getting to a a, you know, a coffee farmer in Guatemala or whatever, whatever it is, that's the pinnacle of a nonprofit, is that hyper transparency. And even that's kind of nascent. You know, it's one of those things that even that's a little bit nascent in the industry is still being able to do that level of tracking. That's I'm really excited about that. Do you guys tend to work you guys work with nonprofits or anyone on the taking donations through recurring payments sort of thing?

Eleni Steinman: [00:42:18] We haven't. We've chatted with a few and I mean, quite frankly, what we've learned is donations are down and down markets. Yeah, like down crypto and asset prices are up.

Patrick White: [00:42:29] Yeah, donations are definitely down and I think we haven't seen the killer app for it. Like I think people are still figuring out this killer app that sort of gives you all that transparency to send the dollar. And then, I mean, maybe that ends up being kind of what you guys are working on. Is that because you have to be able to see the dollar come in and then see the dollar go out and trace it all between everything that ends up being a really cool.

Eleni Steinman: [00:42:50] We definitely support donations. And I've talked to a few platforms about accepting recurring crypto donations. Uh, I mean, they work just like a subscription. Except there's no item.

Patrick White: [00:42:59] Right, Right.

Eleni Steinman: [00:43:01] Just the feedback we've gotten from the nonprofits trying to accept donations is like, for the most part, people aren't donating in crypto.

Patrick White: [00:43:10] Yeah. People aren't donating. And then I assume a lot of the nonprofits, the ones that we talked to, also want to off ramp as quickly as possible. So they don't they're not interested in in treasuring digital assets, like they just want the USD to go and put it to work. So that ends up being kind of another issue in terms of this in this like future utopia where you have this like transparency. If the first thing you do is immediately sell your crypto like it kind of like defeats a bit of the purpose. Yeah.

Eleni Steinman: [00:43:35] So I'm, I'm very confident we'll get there. I mean, I think that really simple solution to that is can you get yield on your crypto, right? So keeping it in Usdc you'll do 4% then you'll probably keep it in Usdc. Right. Or trying to turn into and we're closed. We've flirted with these solutions in the past. They just things go in cycles.

Patrick White: [00:43:58] Yeah, yeah, things go in cycles. Well, the last, last question I'll ask you is, is related to that, which is so do you guys or how do you think about factoring and other other pieces that come into play around payments, whether it be factoring or putting your money to work like yield earning once you actually receive payments or things like Klarna, which is obviously intimately tied to like the new the new world of payments, you know, Klarna has become such a critical part of it or the the pay up front and borrow money kind of like world. How do you guys think about that in the crypto world?

Eleni Steinman: [00:44:32] Yeah. So we think about it a lot, which is why we built Loop really to be super flexible. And that's because at its core you send us a payment request and we execute. And by having such a simple structure, that means like we are able to partner with companies like Halliday that are doing buy now, pay later, and they can leverage loop to allow their end users to turn on automatic payments to repay that loan. And I definitely think that is coming. It's still probably a little early for it to be more prevalent, but everything that exists in Web2 will probably get rebuilt in Web3 because yeah, it's been proven to be needed by customers, but the way that it gets rebuilt is going to be rethought to uphold those values We talked about at the beginning, you know, self-custody interoperability, giving users more control because it has to be to be able to work in crypto.

Patrick White: [00:45:27] That's the whole point of crypto. That's why it's why we're all here. Yeah, well, Elenii, this was, this was amazing. Thank you so much for taking the time to chat with us today. This was really interesting, really engaging, really enjoyed learning about, about how you guys think about payments. And I and I love, I love people arguing about streaming. So it's one of those things like it's I love I love hearing the discussion because I think we all keep expecting it to happen and it hasn't. And it's it's a good question to keep on asking ourselves. So thank you so much for for your time today. Yeah, thank.

Eleni Steinman: [00:45:57] You. It was really fun. Thank you for having me.

Rafael Casas: [00:45:59] Our pleasure. How can anyone find you if they want to reach out to you and learn more about loop crypto?

Eleni Steinman: [00:46:04] Oh yeah. So I mean you can find us at Loop crypto.xyz. You can find me on Twitter at Allen Eleni Phoenix or you can find loop crypto at loop crypto x, y, z on Twitter as well.

Patrick White: [00:46:21] Awesome. And of course you can find us Bitwave.io and I'm at Pat White. Raphael What do you have a Twitter handle? What's your Twitter handle?

Rafael Casas: [00:46:28] I do. It's Raphael G-Accon W-2. That's a bit long, but yeah, I'm on there.

Patrick White: [00:46:34] All right.

Rafael Casas: [00:46:35] We appreciate we actually saw it. Thanks to you for some of the shout outs on Twitter of how you're using loop crypto with big wave to pay to schedule your monthly payment. So that's pretty cool.

Eleni Steinman: [00:46:46] We are.

Patrick White: [00:46:47] Amazing. Great. Well, thank you. Thank you so much, Lenny. Have a really wonderful day.

Rafael Casas: [00:46:52] Thanks, everyone, for tuning in.