Meinhard Benn has been programming since the age of twelve and in 1999 realized a project using micropayments. During a ten-year journey through the world and open source community, the banking crisis and Benn’s decision to work on alternatives to global financial structures came.
Based on the code name of today still unknown Bitcoin inventor Satoshi Nakamoto, Benn founded SatoshiPay – a micropayment service on blockchain basis. Not only has this been successful for years, but above all it could democratize the media landscape and cross-border payments.
LEAD: You’ve been dealing with cryptocurrencies and the technology behind them for a few years now. What made you decide to start SatoshiPay?
Meinhard Benn: Unfortunately, my first two crypto startups did not have such great success, partly because it was difficult to get funding. Around 2014, I decided to start my own business and informed myself in more detail about crypto-projects, which got venture capital and won many users. In addition to mining and exchanges, such as Coinbase also included payment services, which I had then decided. I thought that everything in the world was an exchange of values somewhere, which every person exercises hundreds of times a day. So I built a software prototype overnight at a buddy’s kitchen table, which went online the next morning.
He was already able to accept payments and I thought: Krass! We just had the best form of innovation here, without the need to seek approval or other brakes. That was really an important moment for me. Then came a co-founder, with whom we then landed in the accelerator program of Axel Springer-Verlag. We were a bit skeptical at the beginning because everybody wanted to do something with Crypto. But they understood our project and the potential very quickly and the cooperation made sense in our view. That was the kickstart for SatoshiPay.
LEAD: Why did not you decide on the still largest crypto currency Bitcoin for your business model? Or other blockchain sizes, like Ethereum?
Benn: At that time we were dealing with publishing, but were rather in the e-commerce area on the move, where some Bitcoin payments were already accepted. Then there were the first physical Bitcoin ATMs and we knew we had encountered something here. Due to the ever increasing transaction fees, Bitcoin flew out again and we switched to Stellar, an alternative blockchain. It handles their transactions quickly, reliably and cheaply and is well documented. At the time, it floated around the 50th position in the worldwide Altcoin charts, and today is one of the top 10 as many Interbank systems use the technology. We also work with the Stellar Development Foundation, which fits in a bit with me as an open source fan.
Bitcoin did not work for us for other technical reasons. We just wanted to develop a service that can handle payments in the cent range, for example to be able to bill content such as video time played or data volumes in the kilobyte range in open networks. And the Stellar Blockchain was the best solution. Bitcoin was just too “clogged”, Ethereum too complex, and Overkill for our use case, and Ripple did not follow the approach we’re following. It was the same reason why former ripple founder Jed McCaleb left the company and founded the NGO Stellar, which in contrast to Ripple does not have a purely profit-driven motivation.
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LEAD: And how does SatoshiPay work?
Benn: We have developed a simple web browser tool that can be used as a paywall. After the teaser for a contribution click on the “read on” button, over which one can send then any desired or from the publisher specified sum. The money will arrive anywhere in the world in five seconds and can be used immediately by the publisher. SatoshiPay is in this case only the service provider. We do not keep the money, but we redirect it directly after deducting our fees of ten percent. For this we use a separate wallet for each user, ie a kind of safe in which he can deposit the money.
LEAD: Does that work like the browser Brave, which has its own system?
LEAD: What content can I unlock with SatoshiPay or pay the creators on a voluntary basis?
Benn: Basically all. Podcasts, Videos, Music, Articles, PDFs and so on. After payment, the content is displayed within one second while the money is traveling to the publisher. Over the last two years, we have earned our money, expanded the business and discovered that we are also solving a completely different problem. And that is the transfer of funds between the companies, ie international B2B payments. For Stellar there are interfaces to pay off the money in local currency in countries without reliable financial infrastructure. For example, we had a transfer to Nigeria on a cash card, which took a total of 20 seconds and cost only a fraction of what is normally estimated.
LEAD: Does that mean you’re continuing to build your business in that direction?
Benn: Exactly. Of course, we are expanding our offering in the publishing sector and are now adding cross-border payments. We and our venture capitalists, most of whom come from the German and British financial sectors, see great potential, invest a lot here and continue to work together with the Stellar Development Foundation. Cross-border payments is a market in which trillions are moved annually, and we and our investors would like to see the slow and expensive structures changed.
Believe it or not, I and many of my colleagues are working on the motivation to make these services usable and affordable to people around the world. That was always the idea behind Crypto: taking the financial power out of the hands of the gatekeepers and giving them back to the people. Previously, this would not have been possible, but with today’s technology like Blockchain, direct payments from one person or company to another without a middleman are possible. What is already hinting at Bitcoin and blockchains for open governance and other use cases, will be standard everywhere in the near future. LEAD: Thanks a lot for the interview and good luck with SatoshiPay!
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