Payments remain the large case of unresolved use of the Internet. When we buy something online, we usually use a traditional payment method, such as a credit card, which is not “native” to the experience. Your ability to transform with a merchant is verified by a third party (like a bank), which increases costs and adds a lot of inconvenience for buyers and sellers.
Despite the enormous growth of online trade in the past three decades, most transactions occur outside the browser. Marc Andreessen, who created Netscape, called this the “original sin” of the Internet. “You might think that it was the most obvious thing to do to integrate into the browser the possibility of spending money, but you may have noticed that it did not happen,” He declared in 2019. “I think that the original sin was that we could not” I do not actually build economics, that is to say money, at the heart of the Internet. »»
This counts because the cost is massive and carried by all of us. Economists have calculated the total cost of retail payments in the United States up to 2% of GDP, which is almost as much as the US defense budget. Traders frequently cite the cost of processing credit cards as some of their highest operating expenses, which is why many will ask you to pay additional costs to use a card in a store, or place a minimum on the amount that should be spent. The United States, for all its ingenuity, have some of the highest social costs of payments in the developed world, according to many studies.
We tend to forget that Bitcoin was proposed for the first time by Satoshi Nakamoto as “peer electronic cash system” because many crypto is not focused on this use case. But perhaps the next iteration of the development of cryptography will help to solve this problem.
It is certainly the hope of Tyler Spalding, the founder of Anvil, a new decentralized financing protocol (DEFI) which reconcepts credit, which is the basis of all monetary systems.
How does it work
Anvil is an Ethereum smart contract system that manages guarantees and secures credit. It allows individuals and companies to create credit letters (locs) instead of traditional forms of money. You use it by locking Ether or USDC in the Anvil safe and receive a loc for the specified amount. Indeed, the system looks a lot like a bank check that is cashed in your account, except that there is no paper, delays or worries about whether money will endeavor.
Spalding considers Anvil as a new form of money guaranteed with crypto. “By issuing a transparent and generalizable credit, Anvil provides sustainable liquidity-essentially creating money of trust for the global economic system,” he said. “Decentralized technologies without authorization can transform the management of the guarantee by making the process safer and more transparent.”
In terms of the protocol, there is no fees to transform with Anvil, said Spalding, and the technology is open-source. It is the community owned 60% of the distribution of governance tokens to partners and users, who can vote on operational issues. Spalding, which previously co -founded Flexa, a blockchain -based payments network, sees use cases for traditional loans, DEFI counterpart credit (for exchanges or suppliers of liquidity), Pontage assets and payments. Three partners indicated that they wanted to create services using the protocol: AMDAX, a trading and digital asset care supplier; Empowermint, which offers retail cash loans; And Flexa, which uses the guarantee protocol of assets against payments on its network. Because Anvil is open-source, these partners freely use the protocol, creating their own services.
Anvil has no investors. The protocol was kicked by Spalding and its employees over two years of development. Its systems have been verified by Open Zeppelin and Trail of Bits, and Immunifi organized two bug bonus programs to find faults that must be corrected. Spalding feels comfortable that the system is sure in its ambitious objective of disintermediary of payments of payments and the traditional process of credit editing.
“We have done so for a long time. We love this kind of thing, ”said Spalding about his goal of bringing native payments to the Internet and expiring it for Andreessen’s original sin. “We want other people to be able to use this. This is a case of real use. This is the only thing that matters to me.
