A decentralized stablecoin payment platform has secured a $2M investment to break network effects and create a more inclusive stablecoin system.
The concept of peer-to-peer electronic cash, first introduced by Satoshi Nakamoto, has been a driving force behind the development of cryptocurrencies. However, the mismatch between cryptocurrency users and traditional fiat payment systems remains a significant challenge.
Cryptocurrency is a digital or virtual currency that uses cryptography for security and is decentralized, meaning it's not controlled by any government or financial institution.
It was first introduced in 2009 with the launch of Bitcoin, which was created by an anonymous individual using the pseudonym Satoshi Nakamoto.
Since then, over 5,000 other cryptocurrencies have been developed, including Ethereum, Ripple, and Litecoin.
Cryptocurrencies use a technology called blockchain to record transactions, making them secure and transparent.
In countries with alternative electronic payment rails, such as QR codes, scanning a fiat-only code to pay in stablecoins is a real problem. This issue can be particularly frustrating for individuals who want to use cryptocurrencies but are unable to due to the lack of support from vendors. P2P.me, a blockchain-based service, aims to address this challenge by providing a decentralized solution.
Peer-to-peer (P2P) file sharing is a decentralized method of sharing files between two or more computers over the internet. This technology allows users to share files directly with each other without the need for a central server. P2P networks rely on nodes, which are typically individual computers connected to the network, to store and distribute content. The most popular P2P protocols include BitTorrent and Napster. While P2P file sharing can be useful for collaborative work and data transfer, it has also raised concerns about copyright infringement and security risks.
How P2P.me Works
Instead of relying on traditional on-and-off ramps, ‘P2P.me uses a network of middlemen willing to accept USDC from users and send the equivalent fiat along to the intended recipient.’ This process takes approximately 90 seconds and does not require traditional identity checks. However, P2P.me vets its users with zero-knowledge proofs that verify their social media presence and government ID.
The key concern for P2P.me is decentralization and privacy. By using a network of middlemen, the service aims to minimize data storage while maintaining user anonymity. This approach also addresses the issue of self-custody, which is often compromised by centralized exchanges that share user data with governments.
P2P.me’s Progress and Future Plans
Despite its modest $1.6 million in payments from around 1,100 users, mostly in Indonesia, Nigeria, and Vietnam, P2P.me has attracted significant investment from venture capitalists. ‘Multicoin Capital and Coinbase Ventures recently invested $2 million in the service’s seed round.’ The funding has helped P2P.me scale its team to 20 people ahead of a planned push into Latin America. Cooper believes that local communities struggling with traditional financial systems and crypto-savvy tourists will be key adopters of the service. To further decentralize the platform, P2P.me plans to launch a token in the next 12 months, which will shift control to the community.
Breaking Network Effects
The strategic idea behind the token is to scale globally, breaking the network effects of centralized exchanges with P2P.me. By empowering the community, P2P.me aims to create a more inclusive and decentralized stablecoin payment system.
