The California-based Purse.io is a Bitcoin company that has been making moves in the world of commerce. The team built a cross-platform that allows bitcoin users to purchase on Amazon using the digital currency. Purse has been saving people money through their application since they started. With their blockchain based escrow system, they’ve completed roughly USD $4.5 Million transactions and saved their users close to a million dollars so far.
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“Purse is the largest consumer marketplace for Bitcoin with 60k+ users.”
— Andrew Lee, Co-Founder, Purse.io
Purse uses their escrow program as an intermediary and enables a person to create a wishlist of what they would like to purchase. In time, the list is matched with another user who buys the item and it is shipped to the creator of the wish list item. When the payments are settled Purse uses their escrow to pay out the original buyer with Bitcoin. Typically through this process users of Purse can save up to 25% in discounts using the program.
Recently Purse’s Co-founder Andrew Lee got together with Bitcoin.com after his appearance on our All-Star AMA event. Lee gave us some insight on their service and his thoughts on the current state of Bitcoin. During the Bitcoin.com AMA Lee had announced a new decentralized marketplace called Purse Merchants which will allow global merchants to sell over their platform. The Co-founder gives us some inside information about the team’s new announcement and lets us know how it works.
Bitcoin.com: When you discovered Bitcoin in 2011 how much has the environment changed since then?
AL: The Bitcoin ecosystem is much larger now. More entrepreneurs, users, investors, media, and services. But still, it was arguably easier to buy bitcoins back then with Dwolla + Mt Gox. I didn’t have to take a single selfie to buy bitcoins back then.
BC: Do you feel positive about the current state of Bitcoin?
AL: I’m optimistic. Smart, professional people, are getting involved. Based on my experience with traditional financial services, banks + blockchain won’t pan out. Incumbents are usually disrupted by new technology, and I think it will be especially true for Bitcoin.
BC: How much has your user base grown since your inception?
AL: Purse is the largest consumer marketplace for Bitcoin with 60k+ users.
BC: How does the escrow system with Purse Merchant work in simple terms?
AL: Our escrow guarantees to merchants that consumers have committed funds. To consumers, the escrow guarantees they’ll receive what was purchased.
BC: Trezor, Ledger, KangerTech and others are involved with the announcement you made today. Can you explain this in more detail on how they got involved?
AL: We asked, do you want to sell on the world’s largest consumer marketplace for Bitcoin? Wasn’t a hard sell at all. We’re hoping to get 21 on board as well.
BC: A lot of users were quite pleased with the Purse service and complimented your work during the AMA. Were you happy with the discussion?
AL: I was happy with the AMA, and it was great to awesome from users! We wouldn’t be here without the support from our community. Also, big thanks to Roger for inviting me to do the AMA.
BC: Do you consider this new service a direct competitor of eBay or OpenBazaar?
AL: Purse is somewhere in between eBay and OpenBazaar on the decentralization scale.
Unlike legacy marketplaces like eBay, Alibaba, and Etsy, people won’t need bank accounts to buy or sell online.
Unlike other decentralized marketplaces, we’re focused on ease-of-use and customer satisfaction. I think the same reasons people choose where to shop or list items online will still apply for Bitcoin, including customer satisfaction, ease-of-use, and value. Anonymity while sacrificing on these features will be more valuable depending on what’s being transacted.
BC: You speak about smart contracts in “Bitcoin Commerce Is Broken.” Can you explain in more detail how this can be executed?
AL: Bitcoin doesn’t compete well against card on file in usability or value. Someone on the AMA today commented that there’s no reason to spend bitcoins except Purse. Irreversible payments to processors and merchants is not a good idea for large scale global commerce.
So we have to start thinking, why is Bitcoin better for commerce?
We think Bitcoin is better than card networks and interbank transfer payment systems across two axes: accessibility and programmability. While credit cards may seem ubiquitous, a very small minority (5% in the US, <1% globally) have access to accept card payments online. In an age when the opportunity is shifting online, we’re leaving the majority behind by restricting access to accept payment.
Merchants is another step towards solving this problem. Anyone can sell their products on our marketplace for bitcoins. No bank required. KangerTech, for example, does not sell directly in the US even though they are a multi-million dollar company in China. The problem isn’t that they don’t know how to set up a website – banks won’t approve them for merchant processing. Amazon won’t work with them because they don’t like their business (e-cigarette device manufacturer). So they sell through distributors, eBay power-sellers, and other middlemen.
Bitcoin’s scripting language is also unique compared to traditional payment rails. Low-value escrows, for example, are non-existent in fiat today. Purse is the largest blockchain escrow agent, as well as the only implementation for low-value escrows. We have many more use cases and products in the works that further leverage smart contract properties.
BC: Do you think someday Bitcoin could overtake fiat money in the future?
AL: Yes, but with a caveat. It won’t happen without solid use cases and a mechanism for mass adoption.
BC: What’s Purse’s overall mission?
AL: Our mission is to make the world fairer through blockchain commerce.
When we started Purse in a coffee shop, we didn’t set out to create a company. We had a hunch that we could use blockchain escrows to liquidate Amazon gift cards and deliver great deals. Our hunch proved to be correct – we transacted over $4.5M and saved users almost a million dollars.
Like most disruptive technologies, it’s not well understood why Bitcoin is better than incumbent payment systems. We proved that our unique transaction model could be used to provide the best deals on the internet.
We’ve built a company because Bitcoin can deliver unprecedented access and unmatched flexibility for commerce. There’s no reason why blockchain escrows shouldn’t account for 40%+ of online transactions, but we’ll need to identify markets where it makes sense.
Uber powers economic opportunities for drivers without owning vehicles. An even larger opportunity exists to transform global commerce. At Purse, we’re inspired by blockchain technology and building the next generation of PayPal without unnecessary layers of trusted third parties. We have an opportunity to improve the world and build an important lasting company in the process.
Bitcoin.com wants to thank Andrew for attending our AMA event and speaking with us afterward. We are all about the development of applications that provide more real world uses cases for Bitcoin users. Bitcoin.com will be keeping an eye out on Purse Merchant, and it’s upcoming developments as time progresses.
What do you think about Purse Merchant? Let us know in the comments below.
Images courtesy of Purse, Pixbay, and Redmemes