Key Takeaways:
- A new payment protocol, Solana Pay, ushers in a new era of payments and commerce.
- Solana team contributed to the development of the foundations for a truly decentralised, open, and peer-to-peer payment protocol.
- The team believe that this will pave the way for a future in which digital currencies are widely used and digital money moves through the internet.
- The protocol specifies how a customer can send digital dollar currencies, such as USDC, directly from their wallet to a merchant’s account, settling instantly with costs measured in fractions of a penny.
A new payment protocol, Solana Pay, ushers in a new era of payments and commerce. Solana team contributed to developing the foundations for a truly decentralized, open, and peer-to-peer payment protocol. They believe that this will pave the way for a future in which digital currencies are widely used, and digital money moves through the internet like data, uncensored without the need for intermediaries to tax each transaction.
Solana Pay’s central premise is that payment and underlying technology transforms from a necessary service utility to a virtual peer-to-peer communication channel between merchant and consumer. For example, the protocol specifies how customers can send digital dollar currencies, such as USDC, directly from their wallet to a merchant’s account, settling instantly with costs measured in fractions of a penny.
In addition, loyalty, offers and rewards are integrated into the same messaging scheme, making them actual building blocks for the future of commerce. Merchants have long sought an opportunity to leverage deep engagement with their customers, but multiple intermediaries involved in e-commerce or brick-and-mortar transactions makes that problematic.
The next phase of the protocol development will enable merchants to send digital assets back to the consumers. It will open up new capabilities in commerce which were not possible before. It’s also important to note that this is bigger than enabling consumers to “pay with crypto.” Instead, this is about a vision where all currencies, including U.S. dollars, are on-chain and used for a wide range of transactions.
Merchants have accepted cryptocurrencies for years, but acceptance usually means settling in non-stable currencies, swapping out one intermediary for another, and duct-taping square pegs and round holes together. Solana Pay works differently. Here when a customer buys something, it’s out of support. Then, a merchant should reward that support with personalized offers, on-chain loyalty programs, and unique virtual goods to accompany physical purchases. The opportunities are limitless, but only if there’s a payment approach.
Merchants should benefit from all of the advantages that on-chain decentralized payments can provide. Companies will reach the broadest possible audience in the shortest amount of time by relying on a decentralized payment solution, allowing them to maximize their competitive advantage. Customers are also expected to respond positively to such innovative opportunities. For example, Solana Pay allows customers to save money while reducing the time to purchase digital products and services.
