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Back in the dark ages, I was an early employee of Bitpass, a micropayments startup, and for Bitpass I co-founded what may have been the first completely indie o

Back in the dark ages, I was an early employee of Bitpass, a micropayments startup, and for Bitpass I co-founded what may have been the first completely indie online music store, Mperia (in the sense that artists could simply upload and sell their work directly, with no contracts or middlemen). It used Bitpass micropayments for record sales. (We may have also been the first online music store to have Creative Commons licensing built in, as our launch coincided with CC's. I'll never forget at their launch party, when the nice, awkward teenage kid I thought was just some attendee's son got up and was introduced as one of CC's developers, Aaron Swartz.) The thing that killed the momentum then is the same thing that still kills it - card transaction fees. Bitpass got around this by allowing you to buy Bitpass credits for like $3, which you could spend anywhere. It worked great for music, and Mperia was originally seen as a good gateway (and, frankly, loss leader) for getting people to adopt our system. Alas, it never took off, and Bitpass's brilliant CEO and founder got sidelined by investors in favor of some ronin CEO from the ad world who bogged it down in awkward partnership deal negotiations until the money ran out. I'm still convinced, all these years later, that if they'd focused on the indie media angle, it could have taken off. (I also wish that this band who played their first gigs ever at my coffeeshop open mic in Vegas called The Killers had put their record up pre-record label deal, as I asked them to. I think Brandon was down but their shitty manager told them not to, and later they sued him for being shady af, which I did warn them about.)

jzellis 4y ago
This, by the way, was my first big burnout moment. You put your life into your startup and you truly believe this might make the world a better place, and then a bunch of MBA fucknuts come in and ruin it and you're left with useless stock options and a broken heart. Now I just want to get paid. Never trust the suits, kids. Never trust their bullshit. And never give your heart to the business. It'll get broken every time.
- fullstackchris 4y ago
  Unless you're the owner of it. Then its okay ;) (But even then still never trust the suits)
  - voakbasda 4y ago
    I think the generally good advice "never invest your own money" resonates fully with the notion of "never put your heart into it".
- deleted 4y ago
  [deleted]
sneak 4y ago
> The thing that killed the momentum then is the same thing that still kills it - card transaction fees. If only there were some permissionless internet payments system that has near-zero fees and realtime settlement that works across borders and has frictionless setup. The real problem is not the market or the technology, it's that the state wishes to surveil and ultimately exercise veto over all payments in society. Lightning payments solve this perfectly and could across the whole web but it's illegal in the US to "transmit money" without doing all sorts of market-killing, expensive customer intrusion and surveillance (and buying expensive licenses in every state). There's nothing technically stopping a browser extension from letting you anonymously pay a penny per request or something in one click to pass a paywall. It's just the state's incessant hunger to want 100% transaction surveillance and veto.
- zozbot234 4y ago
  > near-zero fees and realtime settlement Yeah, I'm pretty sure that's not a thing. Bitcoin transactions can easily cost tens of dollars each, and Lightning balances are ultimately settled via Bitcoin.
  - sneak 4y ago
    You're incorrect. This is the reason Lightning exists and the problem it solves. Payment channels are a little complex so it's common for people to not understand them, but they do indeed solve this problem completely.
    - rchaud 4y ago
      And yet there isn't a single vendor that's succeeded in bringing a solution to market. Why's that? Nobody likes paying Visa and MC fees. If it works, it should be a slam dunk.
      - sneak 4y ago
        As I mentioned, because it is illegal.
mschuster91 4y ago
> The thing that killed the momentum then is the same thing that still kills it - card transaction fees. Well, the US could follow Europe here if it wanted - in 2015 we've been capping CC fees at 0.3% and debit card fees at 0.2% and at the same time capped per-transaction fees at 5 cents [1], and whoops, suddenly the acceptance of cards in Germany exploded. I can pay the 50ct fee for loos on train stations or 1€ for a soda on a vending machine with cards. The solution to micropayments are not shitcoins, the solution is to squeeze the rent seekers. [1] https://www.consilium.europa.eu/en/press/press-releases/2015/04/20/capping-fees-card-based-payments/ https://www.consilium.europa.eu/en/press/press-releases/2015...
- memen 4y ago
  Paypal still charges a 7-fold of that in Europe. Is the european regulation not binding? Or is Paypal somehow evading compliance as they are an 'online' creditcard provider?
  - mschuster91 4y ago
    PayPal is not a credit card provider, they are a weird hybrid of a bank and a payment gateway and as such not covered by the regulations on interchange fees.
  - MinorTom 4y ago
    In addition to mschuster91's point, you should know that the cap only applies to four party scheme card transaction interchange, not to scheme fees nor to your acquirer's fees. In reality you will pay somewhere between 0.9% and 2% for your transactions, whereas local schemes can be as cheap as 0.2% or even pennies. Compared to the US's 1.15%~2.7% +10ct interchange (not including other fees!) it's still quite cheap.
    - mschuster91 4y ago
      Add on top the "cashback" and "reward" schemes that many American CCs offer. These are paid for by the vendor.
  - 4y ago
asim 4y ago
This is very interesting, thanks for sharing. We adopted a credit model for our API platform and it's akin to this. I with we were able to do Pay with X as part of that but payments in general are a huge undertaking that requires a lot of upfront network effects. Hence social networks do it really well. Would be interesting to do something Dev centric.
deleted 4y ago
[deleted]
happymellon 4y ago
This sounds similar to eMusic which I had back in the 2000's before they sold out to Sony. It was amazing all the indie music I was able to purchase, load up the wallet and spend micro amounts per song. I think the situation may have improved, with some card processors like Zettle who only take a flat 1.75% of your total daily taking, which makes it a bit easier to do many small transactions.

jzellis 4y ago

This, by the way, was my first big burnout moment. You put your life into your startup and you truly believe this might make the world a better place, and then a bunch of MBA fucknuts come in and ruin it and you're left with useless stock options and a broken heart. Now I just want to get paid. Never trust the suits, kids. Never trust their bullshit. And never give your heart to the business. It'll get broken every time.

fullstackchris 4y ago
Unless you're the owner of it. Then its okay ;) (But even then still never trust the suits)
- voakbasda 4y ago
  I think the generally good advice "never invest your own money" resonates fully with the notion of "never put your heart into it".
deleted 4y ago
[deleted]

sneak 4y ago

> The thing that killed the momentum then is the same thing that still kills it - card transaction fees. If only there were some permissionless internet payments system that has near-zero fees and realtime settlement that works across borders and has frictionless setup. The real problem is not the market or the technology, it's that the state wishes to surveil and ultimately exercise veto over all payments in society. Lightning payments solve this perfectly and could across the whole web but it's illegal in the US to "transmit money" without doing all sorts of market-killing, expensive customer intrusion and surveillance (and buying expensive licenses in every state). There's nothing technically stopping a browser extension from letting you anonymously pay a penny per request or something in one click to pass a paywall. It's just the state's incessant hunger to want 100% transaction surveillance and veto.

zozbot234 4y ago
> near-zero fees and realtime settlement Yeah, I'm pretty sure that's not a thing. Bitcoin transactions can easily cost tens of dollars each, and Lightning balances are ultimately settled via Bitcoin.
- sneak 4y ago
  You're incorrect. This is the reason Lightning exists and the problem it solves. Payment channels are a little complex so it's common for people to not understand them, but they do indeed solve this problem completely.
  - rchaud 4y ago
    And yet there isn't a single vendor that's succeeded in bringing a solution to market. Why's that? Nobody likes paying Visa and MC fees. If it works, it should be a slam dunk.
    - sneak 4y ago
      As I mentioned, because it is illegal.

mschuster91 4y ago

> The thing that killed the momentum then is the same thing that still kills it - card transaction fees. Well, the US could follow Europe here if it wanted - in 2015 we've been capping CC fees at 0.3% and debit card fees at 0.2% and at the same time capped per-transaction fees at 5 cents [1], and whoops, suddenly the acceptance of cards in Germany exploded. I can pay the 50ct fee for loos on train stations or 1€ for a soda on a vending machine with cards. The solution to micropayments are not shitcoins, the solution is to squeeze the rent seekers. [1] https://www.consilium.europa.eu/en/press/press-releases/2015/04/20/capping-fees-card-based-payments/ https://www.consilium.europa.eu/en/press/press-releases/2015...

memen 4y ago
Paypal still charges a 7-fold of that in Europe. Is the european regulation not binding? Or is Paypal somehow evading compliance as they are an 'online' creditcard provider?
- mschuster91 4y ago
  PayPal is not a credit card provider, they are a weird hybrid of a bank and a payment gateway and as such not covered by the regulations on interchange fees.
- MinorTom 4y ago
  In addition to mschuster91's point, you should know that the cap only applies to four party scheme card transaction interchange, not to scheme fees nor to your acquirer's fees. In reality you will pay somewhere between 0.9% and 2% for your transactions, whereas local schemes can be as cheap as 0.2% or even pennies. Compared to the US's 1.15%~2.7% +10ct interchange (not including other fees!) it's still quite cheap.
  - mschuster91 4y ago
    Add on top the "cashback" and "reward" schemes that many American CCs offer. These are paid for by the vendor.
- 4y ago

asim 4y ago

This is very interesting, thanks for sharing. We adopted a credit model for our API platform and it's akin to this. I with we were able to do Pay with X as part of that but payments in general are a huge undertaking that requires a lot of upfront network effects. Hence social networks do it really well. Would be interesting to do something Dev centric.

deleted 4y ago

[deleted]

happymellon 4y ago

This sounds similar to eMusic which I had back in the 2000's before they sold out to Sony. It was amazing all the indie music I was able to purchase, load up the wallet and spend micro amounts per song. I think the situation may have improved, with some card processors like Zettle who only take a flat 1.75% of your total daily taking, which makes it a bit easier to do many small transactions.