AMA Highlights — DePay

By Daniel Dal Bello, Director.
January 18, 2021–16 min read.

On Thursday 14 January, we welcomed Sebastian Pape from DePay into the Hillrise Group Telegram chat for an AMA. Sebastian is the CEO and mastermind behind the DePay project.

DePay was debuted at the ETHOnline event in the second half of 2020 as a “drop-in, all-in-all, anything-to-anything, crypto-payment solution”.

Created to be an uncomplicated and effective solution for crypto-payments and spurred on by the lacking applications of incumbents that don’t address this market in an effective way.

Their product suite will include several products including: payment processing and subscriptions, tokenized payroll, lending, token sales, swaps, a wallet product, and bespoke solutions for power users.

In this post, we have compiled key questions and answers from the event.

Daniel Dal Bello
Sebastian, welcome and thank you for joining us. We have been looking forward to this AMA ever since we first came across the DePay name back in November last year after your success in the ETHOnline event in October 2020.

There you were a shortlisted finalist among over 170 other entrants.

What’s the origin story of the DePay project?

Sebastian Pape
👋 Hey everyone, thanks for having me…

Throughout the entire time I’ve been building in blockchain I found the payment experience in the decentralized web very tedious.

I’ve stumbled upon so many dApps and websites over the last couple of years that while they offer crypto-payments they either only allow one asset class (e.g. ETH or USDT) or their own ERC-20 token.

During the huge success of liquidity pool protocols in 2020, mainly driven by Uniswap v2, I just put 2+2 together, and decentralized payment processing was born — enabling any-to-anything payments.

To be honest, I don’t really remember the exact trigger or moment where I decided, “ Yes, I’m gonna built this.” The moment I do remember from the early journey was the moment I saw the ETHOnline Hackathon announcement just when I started generating ideas.

That got stuck in my memory, also because the ETHOnline Hackathon was just such an intense experience from the beginning to the end.

Daniel Dal Bello
You just spoke to this in your introduction about the state of payment processing and settlement in cryptocurrencies. The point of payment is a real friction point for dApps, platforms, and other service providers.

You might have to go through multiple value exchanges where you need to convert and reconvert some value into an acceptable payment type.

How have you built the DePay product suite to simplify the payments market and remove those paint points?

Sebastian Pape
It all starts with payment processing — which is not only a protocol (smart-contract-based) but also our first basic product, DePay Payments.

One friction point we are going to reduce is by offering complete end-to-end widgets that dApps and websites can use and integrate into their backend, to not worry about the entire user experience while paying.

The processor makes sure that the basic steps of a payment are performed, e.g. take money from the sender, and make sure receiver receives what they want.

In between it’s either a conversion or a direct transfer, depending on our wallet scan results — another part of our basic product that is going to reduce friction and the point of payment.

One friction point we are going to reduce is by offering complete end-to-end widgets that dApps and websites can use and integrate into their backend, to not worry about the entire user experience while paying.

On top of that, because we actually started a year-long journey after the Hackathon, we had to sit and figure out, what we are going to build over the next 3+ years.

So naturally, we got ideas from existing solutions, like credit card processing or common online payment methods and we converted them into solutions that we can build in blockchain, too. For example, our products Subscriptions, Payroll, TokenSale, Swap, Credit, our own wallet, and DePay PRO — a professional toolset for businesses and professionals in order to manage their crypto-income.

Raymond Reijnders
Would be curious to know how you have been experiencing building DePay thus far. Have you come across any specific challenges after the Hackathon, and how have you experienced building a team around you and the project overall?

Sebastian Pape
I’m so glad that right after the Hackathon, the release of HardHat has been announced. In professional software engineering, it’s always important to have a good toolset in order to deliver software solutions quickly. The better the toolset, the faster and the better you can develop software.

I felt the difference of developing blockchain software immediately for using all these new tools that are around that help you and speed you up on delivering software for blockchain quickly. Compared to 2018 where I’ve launched my first crypto-project on Ethereum.

Corona was definitely challenging in regards of getting the DePay company founded because everything here in Switzerland took twice as long and Switzerland has already been known to be slow when it comes to administrative processing. 🐌

Daniel Dal Bello
When we read about your competitive positioning in your documentation you highlight several core points of focus where DePay excels in contrast to existing competition. Namely we are referencing transaction simplicity, decentralization, and payment diversification.

In the crypto-startup context we can mention other names like Crypto.com, COTI, and Utrust as reasonable points of comparison.

Can you talk to us about those competitive focus areas and how you present a better solution to current competition?

Sebastian Pape
All three mentioned projects, Crypto.com, COTI, and Utrust had to build their foundation when there was 0% DeFi.

Crypto.com even went so far as starting to build their own blockchain which they are about to finish after 3 years of development. They had to make those decisions back then, because there was nothing else, nobody could have seen DeFi coming 3–5 years ago, or just a few.

Even though those three started to also facilitate DeFi as a side thing, we are fully built on it, making us the only 100% decentralized payment processing (in regards of anything-to-anything conversion) out there.

Beside that, our wallet scan is used to actually detect the assets of users in order to speed up and improve the UX during crypto-payments processing is also not very common yet. That might come from the fact that people still think to much in old patterns when it comes to performing payments, we are so used to only pay in our regional currency, but that is shifting entirely with crypto.

Even though those three started to also facilitate DeFi as a side thing, we are fully built on it, making us the only 100% decentralized payment processing (in regards of anything-to-anything conversion) out there.

The speed in which the amount of different asset types and tokens is growing is frightening. And all of them have value.

Gabriel Tan
Speaking of competitors, they charge fees while DePay charges no processing or payment fee aside from passing on network fees from Ethereum.

Why have you taken this approach? How does DePay supplement this foregone revenue?

Sebastian Pape
The decision to initially not charge any payment processing fees had two reasons:

1. When people have to decide what solution to use (e.g. in regards to payment processing) they tend to select the one that is free. Take Google Office as an example. Charging processing fees already from the start would have potentially limited the adoption of DePay and in the end our growth, and we plan to grow fast, that’s why we decided against payment processing fees in the beginning.
2. Within the decentralized crypto-scene, the culture, the movement, is very much about removing centralization, so we also believe that charging a centralized fee, e.g. as the DePay Team would have gone against this fundamental idea, it could still very well be that we allow people to facilitate financial revenues from providing functionalities to the payment protocol at some point in order to allow people to earn for the functionalities they provide. For example, when we on our own start to provide liquidity pools to perform and enable payment processing. But one thing after the other, first we built on what’s already there.

Charging processing fees already from the start would have potentially limited the adoption of DePay and in the end our growth, and we plan to grow fast, that’s why we decided against payment processing fees in the beginning.

We supplement that foregone revenue with DePay PRO, it’s our main revenue stream. As it’s also going to contain the most amount of intellectual property and closed source software in the long run, from a business perspective we are focused on generating our biggest revenues here.

Daniel Dal Bello
So this [DePay PRO] will become quite a focus point for you in the long-run?

Sebastian Pape
Definitely, especially as a company. Also because we will need to handover all basic protocols and products to governance in order for it to stay untouchable and decentralized.

So we couldn’t even monetize the basics as a company on the long run, as we will turn it into a public good.

But the governance (token holders) and the community will be able to do that.

Raymond Reijnders
Could you tell us a bit more about what you foresee for future utility? I can imagine a lot having changed since the original vision from when you were participating at ETHGlobal, having added so many products to your product suite.

In the absence of DePay PRO, we’re also curious to find out how value will accrue to token holders?

Sebastian Pape
As the DEPAY token has 2 parts, both utility and governance, the final value will always result from the combination of both.

The initial driver for utility will be DePay PRO, as DePay PRO users will need to pay or stake DEPAY in order to activate DePay PRO. And to clarify this, the boundaries where the basic products turn into DePay PRO products is not 100% defined yet, e.g. think of having the need to change the colors of the DePay Payment widget to your company colors, that could already be DePay PRO so people would need to have the DEPAY token in order to enable this functionality.

But in regards of utility, also entirely new drivers could arise over the next 3 years, an example of protocol utility we often talk about is influencing the decision making of what token to suggest to the user when performing payments, let me make a quick example here.

Think of a user that has 0.01 ETH, 100 UNI, and 100 SUSHI in his wallet, he needs to perform a $200 payment so we could suggest either UNI or SUSHI, from a cost-effectiveness perspective it makes no difference.

So from a protocol perspective, UNI and SUSHI could stake DEPAY in order to influence the decision making of what token gets suggested in that moment, naturally you don’t want your token to be used as a means of payment as that would mean selling it, which would decrease the price of that token in decentralized exchange protocols.

And then there is governance. Having the ability to suggest and vote on those protocol changes can have a big influence on the perceived token value, take UNI as a pure governance token as an example.

Raymond Reijnders
This is actually a great insight. It even motivates the DAOs of those protocols to take an interest in payment processors like DePay.

Daniel Dal Bello
So you are talking about suggesting a utility where you could essentially influence the display ranking of a payment asset over another?

Sebastian Pape
Exactly. But, only if it would not be against the interest of the user, e.g. when the receiver asks for 100 USDT and the sender has 100 USDT it would be against his interest to suggest something else as he would just pay more network fees.

Daniel Dal Bello
You’ve taken down the beta version of the app from the website to prepare for the launch of v1. Is this expected to be on track with your roadmap seen in your whitepaper? When will the rest of the products start to roll out?

Is your approach to build and launch quickly and then iterate and improve over time, or rather test, test, test, and then launch a polished product at a later date?

Sebastian Pape
With DePay Payment v1 we are currently still on track to launch somewhere around the end of January (there can always be some days of delay).

We also plan to have basic, minimal versions of all of our products of the entire suite launched by summer 2021.

In my professional career, I’ve launched plenty of software projects and apps from thousands of users to millions. And one thing I’ve learned is, that you have to ship early, as early as you can, if you are embarrassed by what you’ve shipped, you didn’t die in beauty.

Simply because that allows you to immediately start the most important cycle in software/product development which is iteration, user feedback, improvements, repeat.

There is a saying in software development, the longer you wait for the launch/deployment, the more likely it becomes, that you will never ship.

There is a saying in software development, the longer you wait for the launch/deployment, the more likely it becomes, that you will never ship.

Gabriel Tan
From a payments/subscriptions perspective, could DEPAY be used for deposits before delivery of a product/service? Or is that not required since its all smart-contract based?

Sebastian Pape
In theory people could start using the DePay smart contracts for payment processing even before we finished the UI and widgets on top.

But as it’s all just a matter of weeks from here, I think it would be unreasonable.

The DEPAY token itself is not required for payments neither subscriptions as the DEPAY token will initially unlock DePay PRO, which we also expect the v1 to launch in February.

With a dashboard that aggregates your incoming payments trough DePay as nobody likes to dig through Etherscan for hours.

Raymond Reijnders
We’ve taken note that you are exploring layer-2 solutions in the context of addressing scalability and cost issues on Ethereum.

What are your thoughts on the future for Eth2, scalability concerns, and the ultimate impact on DePay?

Sebastian Pape
One thing that I noticed right after the ETHOnline Hackathon is that various layer-2 solutions approached us to motivate us to build on their solution, so I felt there is quite some competition between them.

And yes, DePay will be on one or multiple layer-2 solutions at some point, but one step after the other. I personally believe in where Ethereum-2 is heading with POS and sharding, due to the immense island DeFi created, I am just a little bit afraid that sharding will lead to 11 shards that nobody cares about, and this one shard which contains DeFi which is going to be constantly overloaded — potentially ending up where we’ve started, but that depends on how well inter-sharding transactions will turn out in the long run.

We also want to contribute to solving Ethereum scalability issues from our end, as our contribution, that’s why we are not only going to grow into layer-2 solutions, be most likely perform fundamental research to improve them. For example, certain smart contract optimizations etc. etc.

Raymond Reijnders
Quite happy to hear this actually, but with Eth2 still in its infancy, what are your thoughts on the period in-between now and Eth2?

Sebastian Pape
In between now and Eth2 you just have to position yourself as good as you can, because Eth2 is going happen, if you want it or not, and everyone who is well prepared will get all the benefits that come with it, automatically.

Until then, we will still experience slow adoption, but the space is already big enough for us to grow and survive so we are not really fearing the time in between.

We could rush into a layer-2 solution, but people often underestimate the on-ramp, off-ramp procedure people have to go through in order to be able to use those layer-2 solutions in the first place — so that could hinder adoption rather then improving it for DePay.

The ultimate impact on DePay… when we position ourselves as planned, once gas and scalability issues are not as big of a problem anymore, we see a huge growth potential.

It’s just logical — an easy to implement any-to-anything payment processor, 100% decentralized, no processing fees, fast, low network fees. It would be exactly how I imagined payments when I first entered the space.

It’s just logical — an easy to implement any-to-anything payment processor, 100% decentralized, no processing fees, fast, low network fees. It would be exactly how I imagined payments when I first entered the space.

Luckily that was not the case, so I got the chance to build it.

Daniel Dal Bello
Curious about this Sebastian… DePay is built for and deployed on the Ethereum network currently. We note that you plan to extend DePay to other networks like Polkadot and Quant in the future.

When do you expect to make your first deployment onto another network?

How important is it from your perspective to go-to-market in other blockchain ecosystems like Polkadot?

Sebastian Pape
We consider inter-blockchain ecosystems being in their first steps, like early. We plan to start building on them right after we’ve managed to release all basic products this summer, we might see the first DePay, decentralized inter-blockchain payment still this year.

I think it’s very important to grow into other blockchain ecosystems with our technology, we focus very much on the end user experience and adoption, the average users do not even know the difference between Bitcoin and Ethereum and might never, not a lot of people understand how the internet works, still everybody uses it.

That’s kind of our philosophy when it comes to growing DePay.

When it benefits the users of having a better, simpler experience performing blockchain payments, we will consider to grow into that blockchain ecosystem.

@M76seven4
Is v1 including the PRO product and does DePay have any user base that will use DePay PRO directly at release? How has DePay been marketing to the intended customer?

Sebastian Pape
From a user journey it’s using DePay’s free products first, think of your tax declaration, first you want to earn money, then you have to make taxes, so people will start using DePay Payments, then they realize they need more, ending up getting DePay PRO. That’s why we focus on queuing up dApps and websites that will implement DePay Payments once we launch.

We will announce more of those actual users and use cases once we’ve launched v1 of DePay Payments.

But we have plenty lined up, people (especially dApps) even started reaching out to us, because they want to use DePay Payments.

Marketing so far has been lot’s of direct communication and reaching out to providers of websites and dApps, we are still small, the space is still small, so we can still manage a lot of things with manual networking and reaching out. Beside that, we also started launching classic online marketing campaigns, like advertising in the space etc.

Raymond Reijnders
With N3rdz being the first integration, how did this partnership eventuate and to what extent do you consider it a good (future) showcase of the possibilities of the DePay product suite?

Sebastian Pape
During this time where we are hyper focused on the product development and we simply didn’t have time to explain DePay Payments in particular details to all lined up partners (we will once we’ve launched).

N3rdz instead, being a technically very skilled and tech-adept team, got what we are doing from the first moment, without us investing a lot of explaining it. That’s why we not only formed the partnership quickly but also announced it immediately.

From a technology perspective we will increase the capabilities of the DePay payment processor to allow smart contracts to become the receiver of a payment being processed with DePay.

In the N3rdz, example that would allow people to enter yield farming contracts, without worrying about exchanging first.

While the partnership itself will just be a first good use case, the outcome will be more important, a reason why DeFi is so valuable is because it works like ‘Money Lego’. Once we’ve finished allowing smart contracts to become decentralized payment receivers we will see huge interoperability potential.

Daniel Dal Bello
When we talk about the simplicity of implementing your payment widgets and products a broad range of use cases come to mind. We can see your products easily being implemented into the numerous crypto-marketplaces and NFT/gaming products that exist currently.

What collaborations are you interested in exploring over the next 6–12 months?

We spoke about some different ideas before, Dextools, for example.

Sebastian Pape
We are indeed in talks with Dextools, they are a good example of one of plenty of dApps out there that even though they provide a very good user experience when it comes to helping people find token pairs and evaluate them for trading, they still send people to Uniswap, allowing them to trade there.

Those dApps are interested in enabling people to swap directly on their dApps, as one of Dextools biggest revenue streams is advertisement, they are interested in keeping users on their page as much as they can.

With DePay Swap, which uses the same underlying technologies as DePay Payments, they would be enabled to directly offer token swaps within their dApps without losing users to Uniswap.

Since I’ve started building in Ethereum I’ve also got into direct contact with OpenSea, I know the team personally because they had an interest in hiring me and buying my former platform that I built in 2018.

So they are a good example of what’s high up on our list of top-tier collaborations.

With DePay Swap, which uses the same underlying technologies as DePay Payments, they would be enabled to directly offer token swaps within their dApps without losing users to Uniswap.

The same with the Gods Unchained team, still the ones that sold the most amount of NFTs over Ethereum so far, still they only accept ETH when it comes to selling their card packs. 🤷

Those are just examples, there are plenty more, also outside of the crypto-space, we are very well connected in Switzerland (simply due to our 10+ years professional careers here), so you might see one or two bigger Swiss online companies start using us this year.

Gabriel Tan
Your products benefit both ‘merchants’ and ‘users’. From a merchant perspective, you reduce friction for paying users, subscribers etc. DePay products simplify the payment process, making it more streamlined and efficient — which should in theory increase conversion rates and spending for websites and apps. For users, your wallet scan and suggestion features make it easier than any other DeFi tooling product to pay for goods and services.

What is your go-to-market strategy once your first products do launch?

Sebastian Pape
We are definitely going to focus on the merchants first when it comes to go-to-market strategy. Having reached out to lots of them beforehand (as mentioned in the previous answers) allows us to just help them integrate v1 once it’s released.

Once a merchant integrates DePay as a payment processor, if they are not offering any other crypto-payment processors beside that, users have no choice anyway, that’s why the go-to-market strategy will initially focus on merchants.

We have also prepared plenty of online marketing plans, from content sourcing, to campaigns and growth hacks that focus on funneling people to DePay when they are looking for “Accepting Crypto Payments”, we are going to see this as the biggest growth driver for the upcoming couple of months as it also will allow people to self onboard, which scales better especially in the long term, as at some point, we just cant keep up with the integration demand any more.

Hillrise Group supports ambitious Web3 startups with early-stage venture capital and fundamental research.

DePay is a drop-in, all-in-all, anything-to-anything, crypto-payment solution.

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