Building Digital Cash for the World

What do people want in a payments product? Trust and convenience.

Trust is knowing that your money is where you expect it to be at any given moment. Convenience is putting that money in motion as fluidly as possible.

Since time immemorial there have always been barriers to the simple exchange of value. How far could we go as humans, as a species, if many of those barriers were gone?

Bob Lee is the Chief Product Officer at MobileCoin, bringing with him a wealth of knowledge from his history as the first CTO of Square and the inventor of CashApp. In turning an idea for avoiding annoying and expensive trips to the ATM into a multi-billion dollar enterprise, Bob used his own personal experiences and frustrations with traditional banking to create a unique, simple, and effective product experience for everyone. 

In only a few short years since he first considered the notion of allowing a smartphone to collect credit card payments via the headphone jack, Bob managed to circumvent all sorts of arcane financial systems, allowing him to do away with the card reader altogether. Bob spent years focusing on UX, leading him to meet with banking institutions, lawmakers, and even the federal reserve in pursuit of a seamless, inexpensive user experience.

The traditional banking system is built on a series of opaque, complex relationships between various ‘middlemen’ institutionsbanks, credit card processors, escrow firms, and government institutionsall designed to extract a percentage of each purchase made over their networks. 

This system causes transactions to be needlessly expensive.

This predatory practice by payment processors can rob small businesses and individuals of their economic agency, including Bob’s own mother, whose antique shop struggled to turn a profit due to this cycle.

However, the tradeoff for a smooth, convenient Cash App experience is the lack of data privacy. In exchange for allowing Cash App to function cheaply on these existing financial networks, user spending data is made freely available to the institutions enabling it.

Determined to continue tearing down barriers to economic fairness, Bob joined MobileCoin as our CPO, focusing on three key areas: speed, security, and cost.

Speed: Credit card payments are incredibly complex processes. They happen in two distinct steps:

Payment authorization—this is when money is put into escrow.

Settlement—this process is when money is actually passed between escrow and processing middlemen into the recipient’s bank account. It can take days to complete. If you’re a vendor, you are familiar with these long payment processing times. 

With MobileCoin, transactions are finalized in under 5 seconds with no intermediaries. The only money handlers are the sender and recipient, so many arcane regulations that have been traditionally necessary for consumer protection can now be considered obsolete.

Security: In 2016, Cambridge Analytica admitted to using machine learning algorithms to tailor information based on your Facebook Likes. It is no stretch to say that the ramifications of this revelation are endless. From creepy predictive advertising, to serving up specifically tailored disinformation, your personal habits are not just profitable – they’ve been weaponized. Imagine what banks and payment processors know about you? Imagine who else has paid for access to that aggregate data, and what they can do with it? This is an invasion of privacy we often don’t realize we’re signing up for, and with access to this data comes the potential to shape culture in ways that aren’t necessarily beneficial to everyone, or even anyone.

MobileCoin puts your own spending information into your hands alone. No longer will anyone have access to your personal preferences without your consent. With MobileCoin comes data security.

Cost: In the world of transactions, fees are everywhere. They’re getting passed around between banks, businesses, and consumers invisibly. Merchants are charged different rates depending on the type of card a consumer is using.

For instance: A Visa rewards card has a 50% higher processing fee than a standard Visa card, while debit cards are legally limited to a 25 cent fee in the US. Meanwhile, UK-based Visa users have even been banned from Amazon due to a lock-up between the companies over fees.

In turn, merchants raise their prices to pass higher card processing fees onto consumers so they can minimize their losses to the middlemen. This means people who use cash and debit cards are subsidizing rewards for those with access to high-fee, exclusive reward cards. The rich get richer, and the rest of us pay for their access.

As MobileCoin’s Chief Product Officer, Bob is invaluable to the vitality and success of MobileCoin. His work defines our product roadmap. The great depth and breadth of his experience working in the mobile payment space informs every aspect of our product, from front to back.

Crucially, Bob also shares MobileCoin’s values and commitment to safety, security, and the proliferation of economic freedom and opportunity for all. Follow him on Twitter @crazybob.

By Bob Lee