Transcription
So today I have Sushil. He is the CEO of one of the top payments platforms, if not the top payment platform on Hideera Drop. Sushil, it's always a pleasure to have you on.
>> Always, thanks for the invite. I always loved, uh, chatting with you and giving you an update on where we are. But before we even proceed any further, I have to thank you from the Hideera community. I think you've done an incredible job, Brandon, uh, in the last, what, four, five years, keeping us all informed with everything that's going on. Most of us are busy with, in our own little world of whatever we do. And the way for us to be connected and to the way for us to be informed, it takes a lot of time. So, I think the Friday evening podcast that comes on in YouTube, at some point in the evening when I'm having my beer or my drink, is when I watch it. So, thank you very much. You become my Friday evening, uh, you know, to watch video so on YouTube.
Well, like I said, Sushil, it's a pleasure always to have you on, but it's also a pleasure to work with all the builders in the space. You know, of course, I have my own little projects going on, but it really is, it doesn't feel like work at all having these conversations and putting out this content because there is so many exciting things going on in the space. But speaking of that, Sushil, you said in a post, and I quote, "Payments haven't felt this exciting in a while." What do you guys have cooking over there at Drop, you and the team, that has you so excited?
>> Um, let me give you some context, uh, behind that, uh, comment. That is a LinkedIn post that we had sent out. We are going to be at a pretty major conference. It's called the, uh, Smarter Faster Payment Conference in San Diego, and it is where almost every major payment company would be there. All the banks would be there, stable coin companies would be there, all, all of them come in. And it happens once a year, and that's where you show your goods, I guess. And I wrote that, but the context really is, it really is very exciting at that point, at this point in payments because the last time it was as exciting was in the early 2000s. You know, that's when the internet was just emerging. I was in that, you know, I was in that era building systems, and I was involved with a product called ReadyCash for Chase Manhattan. You know, we built a product, a peer-to-peer payment, payment platform where we got all the banks together. Chase was Chase Manhattan, which is now JP Morgan, was the bank that sponsored it. That's the same time when X and PayPal and Silicon Valley were, you know, and, you know, where they are now. So it was a very exciting time because till then payments was just checks, right? And maybe a card companies were also emerging. So it felt like there were like hundreds of payment companies trying to look at the internet as a method of payment or as a, as a transportation of, of, of payments. So it was really, uh, interesting at those points.
Now, fast forward 20, 25 years, and a lot has happened in the last 20, 25 years, but now we are yet again at a point where things have become extremely interesting. So let me give you a couple of points, right? Blockchain technologies with crypto payments, as we all know, and I'm not going to bore you with the details, has become interesting. Stable coins, specifically, has become very interesting as a method of payments. And if you look at stable coin volume, they've gone up a lot. Like, uh, I was reading the, uh, Circle's notes, the quarterly results. I think it's like 13 trillion in a quarter. I mean, that's a lot of volume, right? So the, the volumes are high. Stable coins still in the DeFi space, but is it coming to the regular space very soon? And I, I'll, I'm going to comment on that. The second thing is these real-time banking rails, which is very similar to crypto in a way where it's instantaneous payment, low payments, irrevocable, all that stuff. There is, there are two rails, one by the clearing house called RTP, and the other is called FedNow. RTP has been around for a little more, like for 7, 8 years. Their traffic has gone up too. One of the exciting things are, we've been talking about it, and Drop has both of these, uh, rails, the stable coin and RTP. But you need volume, you need scale, you need adoption, you need people to look at it, right? So we have come to a point where in February, the clearing house announced that they did $8 billion in a day on RTP. Now, compared to, still a lot less, but it is a lot more than what it was. So these technologies are maturing.
Then when you look at stable coins, you know, we've always had stable coins in Drop, but now what's happened is with the genius act, right? With all the regulatory environment, and now very soon the clarity act, right? Stable coins have become, well, they were always legit, but they become like real legit, where people want to use it. And Drop's mission, vision is to bring these sophisticated rails, faster rails, instant rails for everyday purchases, not just for the DeFi space where you can just do, do trading. And it doesn't impact the common person. It doesn't, because if you're not trading, you're not using stable coins, okay? If you're not a big business, you're not using RTP. What we are trying to do is bring it to the, to the masses. But for that to happen, those two rails also have to be mature, uh, regulated, and adoption has to go up. So it has become really exciting that these two rails, not just one, like in the internet, all we had was the internet, and we were trying to bring the internet to payments or payments on the internet. Sorry. Now we have two additional rails, two more options.
But there is a third factor, Brandon, which, which really gets me going, and hopefully, hopefully everyone else is excited too. So when we were building ReadyCash and we were building other products in the early 2000s, uh, the payment was all about, the excitement was human interaction with the internet, right? And how humans will interact with this, uh, digital payment system. That was a big challenge. Well, now we got a very interesting challenge. As you know, it's not just humans, it's machines, it's agents. To me, it's exciting because the way we have built up is whether two entities do not have to know each other. And that's exactly what it is going to be now. You know, you have a Whimo car, you have an automated car, no drivers in it, goes to a parking me, parking lot, not a parking meter, drives in and negotiates a payment and goes in. How is that going to happen? Why is it payments is again exciting is you still have now major challenges and very interesting challenges for creative people. And then you got like this fantastic two technologies, the, uh, stable coin rails and the banking rails. So that's why I find this very interesting, very exciting, and it's just not me. Everyone thinks that this is, this is what's going to be the next 5 to 10 years of instant payments, right?
>> So Sushil, we didn't have any plan for this interview. I just saw that post and I wanted to have you come on and kind of tell us in your own words, you know, what you thought about this space. But it's been a long road for Hedera, and, you know, we are seeing these spikes in network activity, but we have a way to go before we're essentially, we've made it. These things like you mentioned, kind of transactional internet of things. We have a few teams working in that deep pin space. We have plenty going on in the payment space, but when do you think it's really going to take hold and we're going to see the kind of volumes that that really make an impact for the Hedera network?
>> Uh, absolutely. So, you know, our focus, if you remember, you interviewed me when we started the company, uh, has always been micropayments because Hedera transaction fees are low, the latency is very low, and, you know, all the good qualities of, of Hedera. And that's what we focused on on micropayments. And I'm going to answer your question, but let me tell you something exciting that happened, and that just tells me it, it, I, I think we're going to see a lot of traction, a lot of transactions on, on Hedera. We really will. So let me give you something exciting that happened for Drop in December. We won the patent for our messaging protocol called Promise to Pay. So the way Drop works, okay, and I'm going to do this quickly. I don't want to be too technical on this. Is the way Drop works is when you request a content from a merchant, you are the consumer, you're a Drop user. You, when you request that content, you don't have to know the merchant. Okay? You don't have to know the merchant. It's not like that you sign up with the merchant. You send a request. The merchant digitally signs on Hedera their, their invoice and sends it to you. You look at the invoice and you say, "Oh," and you could be an agent, or you could be Sushil, you could be Brandon. You, you digitally sign it and say, "Here's my payment." And then it's, it's gets sent to the merchant. The merchant could send it to, will have to send it to Drop, and then we make that payment. So you see this interaction, it's all automated. All of these entities don't have to know each other. Drop being the validator. So Drop has to validate the signatures, right? There are a lot more other companies that are looking at this, this technology. We got a patent on this. Okay, I'm really excited. We got a patent on digitally, uh, signing the invoices and also storing on the Hedera ledger. So we do all of that, and we got patents on, uh, lots of other transactions. And I'm sure there are other companies thinking about similar things. There is an X42 protocol that you, you probably looked at. So what's happening is there is an emergence. We kept talking about micropayments all the time, but now everyone is talking about it. And Brandon, that's a good thing. It's, I'm not worried about competition, right? Because everyone's talking about that. So there is an emergence, and you will see a lot of it. And you might even see it right after May, after this clarity bill gets passed. And I'm only looking because there are some clauses there in, in the bill, uh, which has been, which people are discussing about rewards and all. You would see the concept of stable coin for everyday purchases. You'll see the concept of micropayments between agents. All of those products and concepts that we talked about now are going to start using the blockchain to do that, right?
So you're going back to your questions, you're going to see a lot more after May on the Hedera. And this is my sort of prediction that you're going to see a lot more transactions because we built the layer, we built all the components, we have the off-ramp on. That's, that was another issue that we had. Off-ramp on the stable coins. All of those are being solved. And we needed that, right? To increase the volume, to increase the transaction volume. And we always had the technology. It is that you need the ecosystem system to do that, and you need a perfect use case. So micropayments, agentic, all of that stuff, you know, I call it machine to machine, but you can call it, uh, agentic, uh, payments. All of those are now, you know, getting. And you've seen the speed at which the AI technology is coming. We're working with a company, you probably are aware of it, Unthink, incredible work that they're doing. But there's a lot more companies like that. And so there is this, um, excitement in the industry of making transactions, but you don't know the other entities because they are between two machines. Blockchain is perfect. Is perfect with the flat fee. And I cannot emphasize how much I've looked at lots of different. We have to, we want to make it more, uh, multi-chain. The biggest restriction is transaction speed and the fee. And, and we've done an incredible job in our data to do that. So we should expect a lot more, um, just as the climate changes, you know, things are happening in the world. But once that changes, I think you, you'll see that. So we are very excited. We're building an application that is going to be for the trucking industry, and it's going to be on a Pax, Pax is Pax, Pax VeriFone, and Ingenico. These are like the most common point of sale, uh, devices that you see in the market. Whenever you go to a store, you'll see them. So we have an application that's going to be residing on the Pax, and we're going to demonstrate that the usage of pay by bank, pay by stable coin for the trucking industry, using that device. That's a good entry for us to be offering Drop on one of the top, uh, point of sale solutions out in the, in the market. U, so that, that's a, that's a big thing that we're going to be doing. The second technology that we're working on, and you would see that we continue to work with Trust Bank, and we are in the process of working with them on something called Instant Debit, which is RFP, Request for Payment. And that's really critical because even now when you pay by bank in Interro, you have to fund the account. That's a friction point. With this thing, this becomes, happens instantly, just as you're making a payment. So we're looking forward to, we will be one of the unique wallets in, in the United States who would have that. That should happen at some point in May. So we are really excited about all the technology that we're working on. Brandon, that's, that's a lot doing. And then we really think the next six months after May, um, is going to be more on the blockchain and the agentic commerce, that is the aspect. So we've kind of built the infrastructure for in-store right now. We worked on it for last seven, eight months. Now, we're going to focus back on, um, stable coins, rewards, all of that stuff that we think is going to become huge, uh, in the next, uh, by the end of the year, you, you'll see a lot of, uh, adoption of that technique, right?
>> So many great opportunities out there. Now, Sushil, you're at trade shows around payments on a regular basis. I'll make this my last one. You know, so you're exposed to the biggest retailers, as you mentioned, Trust, the biggest banks out there. You're exposed to stable coin issuers, things like that. What's their reception when they see what you're doing at Drop?
>> So, I'm glad you asked this question. So, uh, we most recently were at the Merchant Advisory Group in San Diego again. Uh, MAG is the conference. It's, it's all about merchants. It's every merchant from Walmart, Netflix, they all show up. So, and we've been there before. We, we've had a booth before, but this time the reception was different because because we have, we are showing the solution in their environment, in a point of sales solution, right? The, that's when it clicks. See, I could be writing articles, I could be showing the product on digital commerce on a website, but when you show them in a physical device, when you show them in a point of sale application, in-store, that's when it clicks. So the reaction, at least what the reaction we've, we had in, in February when we were at the conference, was excellent. We are expecting even far better in the April conference because we actually are going to have the MAX physical terminal with Drop in it. So I, I, I think the more you show use cases, you know, it triggers. People are still hardwired to card, and it takes for people to unwind it and see that you can really pay by stable coin. Like, well, I've seen that in DeFi. I don't know how people would do that. Show me. But when we show them, it's no different than you paying by card because we have tap and pay. We really have QR code and tap and pay. It's just a matter of how you pay. So everything remains the same in par, and you have to do that. And then you can pay with other methods, and then you also get a reward, you get a discount coupon. We do all that stuff. It, then it becomes a little magical, but you have to show it in that environment. I learned the hard way, but I learned it, and that's how we're doing it. So I think, um, that will be impactful. Hopefully, I, I can, for the Hedera Con in, in May, um, I have a speaking slot there. I can bring one of the devices to show people how it's going to work, you know.
>> Well, Sushil, I understand why you're so excited around all the things that you're working on. I'm really looking forward to seeing you in person there at HederaCon. And thanks, of course, for coming on here today and telling us all about it.
>> Hey, thank you very much. And again, I can't thank you enough. I think you, you've done an incredible job for Hedera. Thank you.