The Future of Micropayments with Hedera Hashgraph
Patrick Harding, SVP of Product at Hedera Hashgraph, and Jon West, VP of Blockchain Engineering at Thomson Reuters, take the stage to discuss the future of cryptocurrency micropayments, and the tax and accounting requirements to be expected. Patrick presents a brief history of micropayments and how we got to where we are today. He presents a live demonstration of in-browser micropayments, using an open source decentralized application and wallet extension built on Hedera Hashgraph. Created as a developer example to demonstrate the fundamentals of building a dapp on Hedera Hashgraph, the micropayments dapp showcases the speed and efficiency of Hedera cryptocurrency transactions.
Jon discusses how cryptocurrency micropayments will be treated as taxable events, and how accounting for them will become a business requirement. He explains the potential ways businesses might treat distributed ledger technologies (DLTs) in relation to traditional ERP software, and how DLTs will revolutionize financial business dealings globally. Jon concludes his presentation with a real-world example of utilizing DLTs and cryptocurrency micropayments for government tax remittance purposes, leading to reduced costs and improved efficiency for both businesses and governments.
Patrick Harding | SVP of Product | Hedera Hashgraph
Jon West | VP of Blockchain Engineering | Thomson Reuters
Slides https://www.slideshare.net/HederaHashgraph/the-future-of-micropayments-with-hedera-hashgraph-hedera18 Speakers Patrick Harding | SVP of Product | Hedera Hashgraph Jon West | VP of Blockchain Engineering | Thomson Reuters Abstract Patrick Harding, SVP of Product at Hedera Hashgraph, and Jon West, VP of Blockchain Engineering at Thomson Reuters, will take the stage to discuss the future of cryptocurrency micropayments, and the tax and accounting requirements to be expected.
Moving to Micropayments
For the past two decades, payments over the internet have run on a network created fifty years ago. Retrofitting took us far, but it is starting to show its limitations.
During this portion of the talk, Patrick Harding discusses the business models that were able to emerge and the flaws we are now all too accustomed to experiencing in our everyday lives.
Achievable for the first time, micropayments can play a critical role in fixing these issues.
Patrick goes on to define true micropayments, and articulate which micropayment characteristics would be required to reach mainstream adoption, including the ability to, among other things, offer:
- Ad-hoc payments: No existing business relationship, sign-up, or contract required.
- Low fees: Fraction of a payment with no minimum transaction fee.
- Speed: Less than 3 seconds but up to real-time; in line with VISA.
If the world welcomes this shift, we’ll see exciting new business models emerge: interactions that are short-lived, transient, without vendor lock-in; lower costs from the removal of intermediaries and increased access to capital created by fiat collection and float; and perhaps most importantly to consumers, we’ll see less invasive ads and personal tracking.
The last item Patrick brings to attention is what might be the elephant in the room, end users. End users don’t care about dapps, but to reach web 3.0, they may care about micropayments.
These can be brought about in nearly every industry:
- Digital content: Pay per read, no subscription required.
- Rewards: Pay per email response or game achievement.
- Data Monetization: Simplify and monetize every API request with an open API
Enterprise Micropayments by Thomson Reuters [19:12]
Presenting an idea of the direction for micropayments at the enterprise level, Thomson Reuter’s VP of Blockchain Engineering, Jon West, joins Patrick onstage.
West shares Thomson Reuter’s excitement over creating new customers with ad-hoc relationships, while improving the experience for existing ones. The Thomson Reuters team is considering cryptocurrency micropayments for a number of use cases, including:
- Reuters news: Capturing a billion monthly views, Jon sees micropayments as a natural evolution of their existing subscription model. By paying per read they’re able to reduce friction of using their service.
- Legal and accounting files search: For lawyers, a lot of time is spent searching for existing content. Thomson Reuters provides files of past rules, regulation, and cases. In a micropayment world they can generate new revenue and service existing customers better on a per-use basis.
- Tax and payment processing: Thomson Reuters supplies software to manage taxes in 150 countries around the world. In a digital currency world there are going to be trillions of transactions. Fiat transactions are handling that today, but with programmable money with immediate settlement we can create new efficiencies. For instance, when you buy anything, even a coffee, there is a ton of effort to manage taxes. With a cryptocurrency transaction, it’s easy to program instantaneous tax management. This can create a system that is more transparent to the buyer, vendor, and tax authority.
Micropayments Demo [25:36]
Lastly, Patrick debuts a look into the what the future consumer micropayments might hold with a browser extension.
The browser extension micropayments example, soon to be open sourced, explores what the future consumer interaction might look like: paying a fraction of a penny to view ad-free content.