SatoshiPay has existed since 2014 and have been focused on developing a nanopayments system since April 2015. In Febuary 2016 they launched their (bitcoin) nanopayments platform and in 2017 have switched from Bitcoin to IOTA as the payment token on the platform. The reason for the switch is due to Transaction Fees. With Bitcoin transaction fees used to be low enough to be a non-issue, however with increased use, limited block size and no ‘lightning network’ yet available the fees have grown to be significant for this use case (micropayments).
SatoshiPay have transitioned to the IOTA platform due to IOTA’s attractive 0-fee architecture. Today (16th October 2017) they released their demo for an IOTA enabled SatoshiPay. The main advantages of using IOTA are listed from the get go!
Fast, Trustless and Feeless?
- Fast – IOTA transactions over a lightning network are bound to be quick. The lightweight platform uses flash channels which are high speed and don’t require broadcasting each intermediate tx to the network (the tangle). This allows for a slick user experience.
- Trustless – This is contentious. Though we are strong supporters of the IOTA network it cannot be argued that the network is currently Trustless. The Coordinator ensures the network is not gamed in these early stages of adoption. This is a perfectly reasonable implementation of early stage 51% (33%) attack prevention but it does mean that the current IOTA network relies on the Coordinator. Not much is known about *exactly* how the coordinator works and it is operated by a known group (the developers of the IOTA platform) so this trust is acceptable at this stage. Once the network grows to a reasonable size the coordinator will be removed and the network will indeed be trustless. (IOTA Dev’s – please let us know if you feel this is inaccurate and we will consider rewording.)
- Feeless – This is accurate. IOTA has 0 tx fee. The demo uses an IOTA testnet so funding the demo is as simple as clicking a button to get test IOTA. When the platform goes live we expect that a qr code (corresponding to your SatoshiPay IOTA wallet) will be displayed for funding. We also expect that Paypal / CreditCard / Shapeshift integration will be adopted by all micropayment websites in the future as the target demographic moves from the cryptocurrency community to a wider, less technologically savvy audience.
With SatoshiPay pay walled text is redacted and highlighted orange. This works well and there is a clear visual cue to click on the text to ‘unlock’ it.
After clicking the text the user waits for the transaction to hit the network. The orange button turns grey and a loading wheel appears.
Quickly the loading is completed and the Pay-walled text is visible.
All in all this is a very slick implementation of a paywall and shows how seamless a paywall can feel when implemented using cutting edge technology. The partnership with IOTA is a clear winning move as the IOTA platform promises to enable a completely scalable payment processing backend which costs both the user and SatoshiPay nothing to use. A 10% flat fee on transactions was previously SatoshiPay’s method of generating profit and it remains to be seen whether this is an acceptable level and method or whether different methods will prevail. For now SatoshiPay is marking itself as a clear contender for the online micropayments market – an area we have written about before.
We recently met with the Co-Founders of Yours.org in San Francisco to discuss their platform. We are currently writing up our summary of that interview and thus felt it necessary to comment on this competitor in the micro-transaction field. Yours uses Bitcoin Cash rather than IOTA which currently offers low fees and quick transaction times. Be sure to follow us on Twitter to get an announcement when we publish our interview.
We would love to chat to the SatoshiPay team and anyone else working on MicroPayments – reach out to us at contact@UKcryptocurrency.com! We are especially interested in whether you will continue with the 10% fee model or if you will switch to a different model now IOTA is being used.
If you enjoyed reading this and are an IOTA user donations are possible at the following IOTA address: