261–270 of 278 posts
Cofounder of Lopay here - we have the same mission: offer free payments to businesses, but we're working with existing networks to do this. QR code payments are particularly hard in countries like US and UK as you're trying to change consumer behaviour. I tried doing this in 2014 and again in 2019 - both failed to gain traction (aside from during COVID). In the UK it's possible to accept card payments for 0% via Lopa…
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> but for rules-following merchants taking cash isn't any cheaper than paying the credit card fees. That’s not true at all, particularly for large purchases. If I go to an electronics and check out with $5000 in electronics, there’s no way that handling cash incurs the same expense to the store as the 3% fee ($150). Maybe for nickel and dime purchases, but that’s rarely the case. Even a $50 dinner doesn’t cost the re…
Business banking != consumer banking. The bank will charge ~$0.10-$0.50 for that $50 deposit + the wages of the person who goes to the bank to pay it in (minimum $7.25 per hour).
1. A global, enforceable rulebook + dispute court. They standardize how authorization, clearing, settlement, chargebacks, retrievals, representments, reason codes, and evidence work—and they arbitrate when parties fight. That governance is why a corner bodega and a transnational airline can both accept the same credential. (Read the rulebooks; they’re huge, living specs.) 2. Credible liability commitments that change customer behavior. Zero-liability and liability-shift regimes make consumers fearless and pressure merchants to adopt secure tech (EMV, 3-DS). Fearless buyers = higher conversion. That demand-side boost is the engine of card commerce. 3. Tokenized, portable identity for payments. Network tokens (EMVCo) and wallet provisioning (Apple Pay/Google Pay via DPANs) are the reason card data can live safely in phones, browsers, and vaults. This reduces breach externalities and keeps the credential working when plastic changes. That’s not ACH. 4. Compliance offload and ecosystem discipline. PCI exists so the brands don’t directly police every merchant’s infosec day-to-day—yet they still set the bar and yank privileges when needed. It’s governance as a service. 5. Programmable payout rails on the same credential. They’re not just purchase networks anymore. Push-to-card (Visa Direct/Mastercard Send) rides the acceptance footprint for disbursements, wage advances, gig payouts, and remittances—instantly, to billions of cards. That makes the card a universal endpoint for money-in and money-out. 6. Regulatory navigation and durability. Interchange caps and business-rule constraints (EU IFR; U.S. Durbin/Reg II) didn’t kill them; they adapted by shifting economics across scheme fees, value-added services, and routing. Survivability under hostile policy is part of the value. 7. They own the “choice architecture.” Historically, anti-steering rules protected fee levels; those were curtailed, but the lesson stands: control over how credentials are presented and preferred at checkout is leverage. (See the AmEx case for the legal theory on two-sided markets and steering.)
What they don’t do (important) • They don’t issue credit or carry most fraud losses—that’s issuers. Networks set rules and move bits; issuers/acquirers take primary financial exposure and then sling chargebacks through the network’s process. (Still: the rules are the value.) • They aren’t the only rails that can scale: account-to-account can win when the state or banks coordinate (Pix, UPI, iDEAL). Those systems prove rails alone can beat cards on price and UX—if you also deliver governance and adoption.
Where they’re vulnerable next (and already hedging) • A2A/instant schemes (Pix, UPI, iDEAL) are re-wiring consumer habits. If U.S. open banking + FedNow/RTP ever gets real UX and liability parity, cards will feel it. Meanwhile, Visa/MC are buying into open banking to stay the orchestration layer (Visa–Tink; Mastercard–Finicity). • Checkout is being intermediated by wallets and platforms. Apple/Google own the front door; card brands keep the credential alive via network tokens, but UX power is shifting up-stack. Tokenization keeps them relevant; control of the UI does not necessarily stay with them. • Policy pressure keeps grinding down interchange/steering constraints. They can adapt, but the rent skim is under scrutiny—again.
The blunt summary
Visa and Mastercard don’t win because they’re the fastest rail or the cheapest. They win because they govern trust at scale: a portable identity (token), a standardized contract (rules), and a credible promise about who pays when things go wrong (liability). That cocktail reliably boosts conversion for merchants and confidence for consumers. Until an alternative can match all four—rail + rules + identity + liability—cards remain the default operating system for commerce.
What I need is not lower fee cards, but anonymous pre-paid debit cards that do not allow linking purchases to a person and profiling people. Until that appears, I will use cash only.
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The freezes apply only under direction from the federal government. It's not something that the issuer does without this instruction. Tether has no control of its own here, and Amazon won't either. Amazon is just an example. Dozens are coming.
> The freezes apply only under direction from the federal government. Tether chose to build in a freeze capability. > Tether has no control of its own here, and Amazon won't either. Neither can say "no" to a legal order from a government with jurisdiction over them. Both can say "no" to you voluntarily, even absent a court order. An Amazon stablecoin will exist for the purpose of Amazon's own benefit, not consumers'.
As for what Tether chose to do in the past, that's irrelevant, as the legislation now requires it. The only grandfathered stablecoin that doesn't have freezes is DAI, but it has poor liquidity in comparison.
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> Secondly it costs the consumer nothing. The cost goes to the merchant. If anything the customer gets rewards. Sellers increase the price by the fee amount, savvy consumers with rewards cards can get back around 80% of that price increase, and regular non-credit-card-with-rewards holding consumers just subsidize the whole thing by paying the extra. It's a tax on people without rewards cards.
It’s worse on business cards. I negotiated a bank contract for our corporate card program earlier this year and we get 3.5% cash back from purchases. It incentivizes us to pay every vendor invoice by card too as ACH / check actually cost us money.
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It’s worse on business cards. I negotiated a bank contract for our corporate card program earlier this year and we get 3.5% cash back from purchases. It incentivizes us to pay every vendor invoice by card too as ACH / check actually cost us money.
if merchants pay anywhere between 2% to 3%, how is the bank able to pay 3.5% for purchases to your corp card customers? Simple math says the bank would lose money on this which of course won't be true. What am I missing?
If you get a full merchant account as a business, with IC+ billing or similar, your statement will itemize IC charges on every transaction and it’s based on the type of card the customer used.
If it’s Amex / Discover it might be 5% or more. This is why a lot of merchants are Visa and Mastercard only. If your customer has a cash back card, it will maybe be 4%. If your customer uses a no frills visa bank card, it might be 1.5%.
Across a large population of transactions it usually averages 2-3%. But if you have a B2B where all your transactions are from companies like mine, you’ll likely find it averages above 3%.
Businesses like stripe are betting that 2.9% is above the average they see across a very large population of transactions.
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> The freezes apply only under direction from the federal government. Tether chose to build in a freeze capability. > Tether has no control of its own here, and Amazon won't either. Neither can say "no" to a legal order from a government with jurisdiction over them. Both can say "no" to you voluntarily, even absent a court order. An Amazon stablecoin will exist for the purpose of Amazon's own benefit, not consumers'.
There is no incidence of any stablecoin wallet being frozen without the government's order. To do so would invite a lawsuit. As for what Tether chose to do in the past, that's irrelevant, as the legislation now requires it. The only grandfathered stablecoin that doesn't have freezes is DAI, but it has poor liquidity in comparison.
> Tether may suspend or terminate your access to the Site or any of the Services, freeze any Tether Tokens held by you, or terminate your Tether Token Wallet, as required by applicable Law or where Tether, in its sole discretion, determines it is prudent to do so or where you have violated, breached, or acted in a manner inconsistent with any provision of these Terms or Applicable Law.
They will comply with valid court orders. They can also do it on their own volition.
> To do so would invite a lawsuit.
Oh, no, not another one!
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> Secondly it costs the consumer nothing. The cost goes to the merchant. If anything the customer gets rewards. Just like tariffs, right? Visa/MC is a +1% income tax on most of the economy.
That’s an acceptable fee for the consumer protections I receive.
https://www.wired.com/2010/12/realtime/
People are only okay with this because it hasn’t been visibly abused on a large scale yet.
Imagine Nazi Germany having this sort of access to the private transactions of everyone in an entire country.
The abuses won’t ever be front-page news, either, because they’ll only ever be targeted against tiny fractions of society, and most people won’t be directly affected by their lives being surveilled and their rights being so infringed.
https://wikileaks.org/Banking-Blockade.html
Generally and commonly used payment systems (ie cash) that cannot be centrally censored are the only way to avoid this. Presently that means physical cash, physical precious metals, and cryptocurrency.
The first two are impractical for large-scale use.
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That’s an acceptable fee for the consumer protections I receive.
There is another hidden cost: total mass government surveillance of the entire economy, including the ability to arbitrarily veto any transaction or participant for any reason (such as publishing) without trial or even burden of proof. https://www.wired.com/2010/12/realtime/ People are only okay with this because it hasn’t been visibly abused on a large scale yet. Imagine Nazi Germany having this sort of access to th…
Tether freezes accounts. Bitcoin gets confiscated. Eth forked when big stakeholders didn't like how the DAO went. And it's a bit hard to take seriously privacy concerns that propose a public transaction ledger as a solution.
(And of the three, only physical cash has actually been proven in large-scale use.)