Episode Summary
In this conversation, Petr interviews Fran from Superfluid about the concept of streaming money on the blockchain. Fran shares his background in open source and how he got into the crypto space. They discuss the idea behind Superfluid and its ability to stream tokens on chain without gas fees. They explore various use cases for payment streaming, including recurring payments, trading over time, and gaming. Fran highlights the efficiency and interconnected liquidity of Superfluid as a differentiating factor from competitors. They encourage users to join the Superfluid community and developers to explore the open-source code and build innovative experiences using payment streaming.
Takeaways
Superfluid enables the streaming of money on the blockchain without gas fees, allowing for efficient and cost-effective recurring payments.
Payment streaming has a wide range of use cases, including rent payments, salary payments, trading over time, and gaming.
Superfluid's interconnected liquidity sets it apart from competitors, as it allows for seamless and simultaneous payment streams between multiple parties.
Developers are encouraged to explore Superfluid's open-source code and build innovative experiences using payment streaming.
Video Episode player
Chapters
00:00 Introduction and Background
03:22 The Concept of Streaming Money
07:22 Use Cases for Payment Streaming
12:04 Challenges and Benefits of Payment Streaming
20:26 Exotic Use Cases for Payment Streaming
25:28 The Role of Games in Adoption
28:01 Differentiating Superfluid from Competitors
31:46 Recommendations and Call to Action
Transcript
BFG: 1:11
Hello everyone. My friend, how are you doing today?
0xFran: 1:15
Yeah, good. Thanks again for the invitation.
BFG: 1:19
So today I'm talking with a 0xFran from Superfluid as you can actually see everywhere on his side of the screen and we've met in ETH Milan and, apart from a great dinner conversation, it was a really interesting presentation which Fran had about the clever ways of streaming money across blockchain without paying too many gas fees for transactions and basically the whole idea behind Superfluid got me really interested. So I'm going to start with asking, as always how did you get to crypto and since when you are actually in a blockchain space? And then we'll see how it goes.
0xFran: 2:06
Yeah, again, thanks a lot for the invitation. I think one thing I like to mention is when I was about 15 years old, I started down the open source route, so I started using Linux. I started looking very deeply into open source. I made my first open source contributions Not technical, I was doing translations, but it was kind of part of that early, it was part of my formative years, let's say. Then I worked on a bunch of different things and I didn't really do anything technical for a long time. In 2017, I first heard about crypto, again from a friend. He was telling me about prediction markets, so that piqued my interest. At some point I moved to Estonia. Estonia is like this digital nation got excited. The first day I was there, I went to a crypto meetup. Again, I didn't know anything about crypto, but they were presenting some ICOs. I don't know if people remember, but there were these countdowns, these websites with countdowns. It was like the countdown to the ICO, so everybody had a countdown on their website.
BFG: 3:15
It was very exciting.
0xFran: 3:19
I think I must have asked some good questions to the presenters, because after that meetup, a few people came to me. Basically, I got a job working in crypto, so I was working for a company that was preparing to do an ICO. Fast forward, maybe four or five months. They decided not to do the ICO, but in the meantime I was down the rabbit hole watching videos every day.
BFG: 3:47
Learning.
0xFran: 3:48
I was captured. There's no way back at that point. I'd say I was still in the generic crypto bubble at that point, so looking a lot at Bitcoin stuff, a lot of the new altcoins, icos, that kind of stuff. Then, about June 2018, I closed my engagement with that company and I started looking more deeply into the Ethereum space. That's more or less when I started working directly with my current co-founder and basically we were building stuff on Ethereum. We did that together for a while. I started doing some coding as well, which was good to get a bit of that technical knowledge. Then, in 2019, so a year later we basically decided to build a product and we launched one of the first derivatives of DAI DAI, the stablecoin in 2019 summer. There were maybe four or five projects maybe five. It was a very small ecosystem at the time and we launched one of the first derivatives, so that taught us quite a lot of attention. We started speaking to a lot more people and eventually we realized that some of the things we were doing with this token were really interesting. Specifically, we were actually distributing yields on chain in a very efficient way, like a lot of projects do, if you're earning yield or compound or you're not paying gas to receive that interest, you're simply receiving it. We started thinking wait, so there are ways that you can encode a token to move on the blockchain without gas transactions, without operations that cost gas. We basically realized you can either do this in a very bespoke way for every specific use case For example, aave, you're distributing yields. This is how you can do that on chain without paying gas, or you can generalize it. That's where we started getting excited about some of the ideas that led to superfluid. Superfluid is a protocol that allows for tokens to be streamed on chain, like you mentioned. Basically, you only make one transaction and that transaction defines the way that tokens will move between one account and the other. After this initial transaction, there are no further gas costs to move the tokens. You can set up a stream. For example, I can say hey, better, you should come work for me. I'll pay you one cent a second. I open that stream and basically I will pay you until I stop the stream without any further interaction. The key here is that not only am I not making interactions, but I'm also not paying for gas because I'm not touching the blockchain. The money is moving without the need for me to actually touch the blockchain at all. That's when we realized we could do this. It was really exciting. The more we explored the idea and built the protocol, the more we got excited, because this actually enables a bunch of stuff that is very novel. One of the things that attracts a lot of people to the crypto space is the novelty and the innovation that we can build, because we're building everything from scratch. Superfluid to me was like the innovation squared it's money on the blockchain and you can stream it. It has all these other cool properties. It's very, very innovative and that's kept me going in the space, basically without ever thinking of leaving, for the last six years.
BFG: 7:25
Yeah, it's impressive, I mean so the me being, you know, a fast entrepreneur number of times. The most interesting part in the most of the conversations is always like, how do you get to the idea right? Because a lot of people start with, you know, being annoyed by something and trying to solve it, and that's typically not the case in in crypto make some most people basically just bump into an idea because they think that would be interesting. And I have to say that I love the streaming dashboard on superfluid After, after we talked you know, I tried it myself. You know open some streams between different wallets and it's just so satisfying to see how the numbers go up. I mean, you have to look at the right wallet, not the one that's sending money- it's a problem. But but yeah, that was very cool, and so I think the natural next question is probably it's like so what are you use cases Are you seeing right now, and what use cases do you imagine for the future? Because I can definitely imagine a ton, but you are more, more qualified to talk about it.
0xFran: 8:34
I mean, having worked on this idea for almost four years now, I can confidently say that, if you go far enough in the future, all recurring payments are going to be streamed. Now, whether that is with superfluids or with some better technology or maybe a worse technology, right, because sometimes that happens to, I can't say confidently made. Obviously we're trying to make it with superfluid, but I think payment streaming is going to be a little bit more than that. So streaming is the future of recurring payments. And just to kind of give a context, a recurring payment is when you're making a payment more than once, right? So, for example, when you pay your rent, when you pay your salary, when you pay your mortgage repayments, when you, you know, make your credit card repayment, when you you use a buy now, pay later and you pay them free tranches, you know whatever it is. And also more things, like more financial use cases, like you know, receiving the yield from a bond, right? Those are all recurring payments. Those are recurring transactions or recurring transfers that require settlements and multiple times. And generally the way that this has been done, you know, throughout the 6000 years of monetary history, has always been in one way, and now we are trying to introduce a new way, right? So it's obviously very different, but I am confident in saying that the way we're proposing is a better one. So, to get an idea right now, usually payments are monthly, right, most things happen on a monthly cadence your rent, your salary sometimes by weekly, you know, sometimes even daily or weekly, right? It depends, and the fact that it depends is one of the problems with that system, right, like the fact that your salary and your rent aren't on the same day, the fact that, in order to manage the cash flow of your business, you have to look at an entire calendar and tell when payments are coming in and when payments are going out, and also the fact that you can't give a straightforward answer to the simple question how long is a month? Right, because you have months that are 28 days and months that are 31 days, should tell you that that is not a good system, right, it's a system that we are used to and you know that we've built around, but it doesn't make it a good system, while one of the advantages of payment streaming, if you imagine it in a very abstract way, is that all the payments are happening at the same time, because they are happening all the time, right? So, basically, if you're paying your salary sorry, if you're receiving your salary and you're paying your rent in a stream, they're happening at the same time and this means you never have cash flow gaps, right? So, very simple example you move to a new city, you rent an apartment, you have to pay $1,000 on the 25th. You're also starting a new job, but your first salary arrives on the 31st, right? Right, you have six days difference. You have the money to pay the apartment, right, but you don't because they're happening on different days, right? So this simple example should tell you that, you know, unifying payment terms is very powerful and in traditional you know, in traditional kind of commercial relations, it's usually the bigger party that decides, right? So if you're renting an apartment, then they tell you you have to pay on the 25th, you have to pay on the 25th. If your employer says we pay, we do pay on the 31st, that's it, right, you have to do it. When the employer says you don't, you don't actually get to negotiate payment terms as a consumer. So if we're able to unify the payment terms into, you know, one kind of over income, everything in capacity payment term, which is continuous, second by second payments, then we no longer have this problem and this actually drives, you know, an incredible amount of efficiency. If you look at it from a systemic level, which is why I say you know, I can confidently say it's a better system for doing recurring payments. It's better for, it's better on a global scale, and that's one of the small issues with superfluid is that it's systemically better, but not necessarily better for everyone involved.
BFG: 13:14
Right, right, yeah can definitely see that point. As you were talking, I was thinking it's like, on a business side, this is awesome, it's like I would love it. And then it's like, yeah, well, you have to completely relearn the negotiation game. Right now, you're kind of used to negotiate everything in monthly terms and then you know when you mentioned but not every month is the same Exactly so if you pay me every second some months, I get different salary than the other months because they are different lengths.
0xFran: 13:48
Yeah, well, the other way to think about it is right now, when you work in February, you're making more money than when you work in October.
BFG: 13:57
He likes that no sense. That's why I'm only working in February. Very efficient, no, so yeah, that's. That's actually pretty cool. The same comes for for rent, right, as you mentioned the other example, yeah.
0xFran: 14:12
Yeah, rent is a very good example, Salaries are a very good example. But then there's all these subscriptions. Right, Like you know, a lot of companies use subscription models. So things like you know, Spotify, Netflix, your internet, you know all of these things are recurring payments, are all subscriptions, and I mean the current system works, but this is much better.
BFG: 14:38
Right, Even though you know so, especially on subscriptions, like when you are paying for some sauce, sauce things, I can imagine that the best way, you know the, let's say, the most legitimately most logical way would be to pay for the use, which is not that straightforward, as you know, pay by the second, but it's more, like you know okay. So when I started streaming, it's a little bit more transactions, but then, you know, I think you can kind of achieve the same thing. And yes, you know, I think people were talking about this for a long time. It's like there was one of the initial idea of micro payments. I think actually started around this logic, but yeah, anyway. So what's some more?
0xFran: 15:25
Yeah, let me go a bit deeper into that, because I love, I love this topic and I never get to talk about it, so I'm going to use this opportunity. So, when you're, when you're deciding on a payment system, there's two things right. One is you know how, how and when the money moves, and the other part is how many actual operations does it create? Because every operation creates a cost. Like, if I decide to like, one of the reasons why we do monthly payments and not daily payments is that, you know, going back to again 6,000 years ago, I don't want to take gold to my landlord every day, right, I want to. That transaction, even though maybe it's very easy, it still has a cost. And even if you assume a completely abstracted, you know, browser extension that does everything on its own, on the other side, you're creating accounting costs, like you're, whatever you do, if there are a lot of operations, it's more expensive somewhere. So, basically, the number of transactions you do, the number of operations, are expensive. And there's this, this concept of basically mental cost, right, or cognitive cost of a transaction, which is the reason micro transactions don't work. So if you were to tell me oh, you have to click here to pay 0.001 cents, and then you click here to stop paying, like that's too complicated for my brain for the amount of money I'm spending, to think about it, right? So instead of reducing cost, you're actually increasing it. Because you know my mental cycles are also aren't free, but with streams you just you're paying. You make one transaction, you're paying Right, like you don't even have to think when you're paying. You're just paying right the whole time. You're paying, yeah, until you stop paying. So it actually reduces the thought processes, it reduces the mental burden Significantly, like. Just just to give you an example, you make a transfer on the bank, right, you click through and then you have to wait, you have to wait, the counterparty has to wait, right, you're both waiting. You send each other two emails saying oh, have you paid? Yes, here's the proof. Oh, I haven't received it yet. Right, and that imagine for a business that has ten thousand customers and Every time there are payment delays. That is an incredible amount of cost. That if you have a payment which is incredibly regular Because it happens every second all that cost disappears. You're either getting paid or you're not. You only deal with cancellations. You no longer have to deal with individual payments. So it's, you know, again, from a kind of efficiency and kind of global point of view, it's very powerful.
BFG: 18:12
It is, it is no, I I like it. I just hope that you know there will be one winner doing all the streaming so I don't have to log into multiple dashboards. Am I streaming to stew, which I think you know? So it's probably a good time to talk about some a little bit more Exotic use cases, because now we talked about pretty straightforward things like grand, yeah, you know, and other stuff. But I am sure you guys are working on some more interesting use cases, because Definitely several come to my mind. But again, I let you talk about it.
0xFran: 18:49
Yeah, I mean okay. So there's, one that I really like, which is the concept of trading over time. A Lot of people use the word dollar cost averaging, right, but it doesn't necessarily have to be dollars, so it's just kind of say buying an average price. This is a very Good trading strategy to accumulate the position. Say, you want to buy aetherium but you're not a trader. You shouldn't try to be a trader if you're not a trader. Right, that's like going to the casino without knowing the rules. Right, you're gonna lose money and I think with trading is the same thing. You know, if you're not a trader, you shouldn't trade. So buying an average price is actually a really good strategy a long term, and Streams actually provide the single best way to do this, because you are literally committing to buy every second. Right, that's the. The best average you're gonna get on the blockchain is to buy every second. So there have been a few products built on superfluid to address this. There's more that are coming and and it's interesting because it also provides a lot of efficiencies around things like slippage, for example. So If you think, imagine, like, forget timing the market, imagine you're you're literally always buying a good price, right? Let's just assume that even then, if you decide to buy a hundred dollars a week, you you have slippage, right. If you go to to uniswap, your, your purchase is gonna move the market and you will lose some value there. Now, the smaller the trade, the less the slippage. Right, if you trade a million dollars, you move the market more. If you Trade a hundred dollars, you move it less. But if you trade One cent every second, you are not moving the market right, which makes it the best way to trade over time. And the some of the really cool things with superfluid is that Payments happen simultaneously. This is a bit hard to understand, but if you imagine I I trade on uniswap, right, I Buy semi for with a hundred dollars and then a second later you make the opposite trade. So you sell some USDC, sorry, so you sell some effort for USDC, right? Yeah, we are both incurring slippage. Right, it's the price is gonna move in one direction and then it's gonna move back and we both pay some fees and some slippage To the uniswap out piece. Yeah. But if our trades were settled Simultaneously, right, then we would basically be trading with each other and there wouldn't be a slippage, because the prices would not move and Because how superfluid streams settle every second. At the same time. We can actually do that in an exchange as well, so you can have an exchange where Both sides of the market are basically Settled simultaneously. So the price moves very, very minimally. It only moves, you know, every second the tiny amount depending on the balance between those trades, but that is way less than if the orders were sequential. So, and basically it has some very, very interesting properties. So trading over time, I think it's gonna be very, very interesting. You can imagine, you know, for example, you know a Dow paying, paying people with tokens, and then the people swapping those tokens for Dollars and then other people who want to buy it to the Dow that maybe they're streaming dollars to buy the token. You know you can imagine that across a lot of different things you could be. Maybe you're getting your, your staking rewards in a stream and then you stream that into USDC. You can imagine people maybe receiving yield from a bond right in USDC, but then they want to swap it for e-fer and they just kind of connect those two streams and they're buying e-fer with their USDC bond Yield, right, so you can connect all these pipes. And and some of the really interesting things are around the fact that this is set it and forget it right. So the moment you you make that transaction to open that stream, it just happens like you don't have to touch it ever again. It will just keep going with no cost and no transaction fees on your end. So, you know, it's really Kind of efficient and it's very exciting to see that we can use the blockchain to make these very automated financial Experiences.
BFG: 23:23
Yeah, yeah, you actually hinted on something which I guess you know. It's on everybody's mind in crypto space and probably even on some people's mind outside of the crypto space who hate crypto. But it's like you know, the idea of being able to do some things almost peer to peer, yeah. So, yeah, it's pretty cool. Is there any super cool use case which is coming up which you would like to? You know, shout out.
0xFran: 23:51
I mean, there are some people building games, which I think are fun, because games are games, are a good way for people to experience new things in a lighthearted way. Right, like if I told you, oh, you're gonna get your salary, you have to pay your rent every second, you're like, no, you know, let's scare it. But but if I told you, oh, you can play this game, you know you do these things, and then you get money every second, you're like, oh, this is really cool, you learn that experience. And then you're like, wait, what else can I do with this? Right, and if you look, even historically, the adoption of the web has been through adult content and games. Right, like, even even me personally, like, the first time I touched a computer was to play video game. Right, and then you start looking deeper and you start learning deeper and you, and then you know, you start applying it to more facets of your life and you're like, oh, wait, but in this game I'm chatting with people in real time. While I'm, you know, while I'm playing the game, I'm collaborating with them. Maybe I could do this at work. Right, and that's how we start using things like Slack at work. Right, these are most of these interfaces are actually built for gamers, and then you start realizing that the collaboration that this enables in a game is actually just collaboration and you can use that work Right. So my hope is that through games we're able to kind of highlight some of the usefulness of the technology and then kind of you know, hopefully adapt it into more kind of valuable and meaningful use cases. Not that games aren't meaningful, but you know what I mean.
BFG: 25:21
You mean like more real life. Yeah, real life, real life. What is it Does? Anybody have real life, I mean, I know I don't.
0xFran: 25:33
So, yeah, I think I think the games are good. I would say, you know, if anyone's keen to have a look, just follow up. You know, follow our channels and when this stuff goes live you'll see it. There are currently already some games you can buy. There's a lottery where you can, you can buy the lottery and then if you win the, if you win the ticket, you will receive a stream forever, which is kind of fun. So, yeah, I mean I think these things are really fun and useful and you know, if you have, if you want to go and try something, these are good use cases to go and try.
BFG: 26:07
So one of the last questions which I always ask is so there are obviously some competitors were doing streaming. What's setting a superfluid apart from them?
0xFran: 26:24
Yeah, that's a that's a really good question and what I really like to touch upon. So there are other players in the space that use the word streaming and they allow you to basically, you know, do, let's say, payment streams from one user to another. I would say that the main thing that sets superfluid aside is the fact that our liquidity is interconnected. So let's, let's, let's try and make an example of what that looks like. So I'm going to use one of our competitors as an example. You, basically, if I want to pay you $1,000, I need to put $1,000 into their contract and define you as a recipient, and then you will be able to go to that contract and withdraw the liquidity over time, right? So you go one day, you can get $10,. You go the next day, you can get $10. So you can go and take the money and it's streaming, right, you can withdraw it. But if you're paying your rent on the other side and you want to pay your rent in a stream, now you have to take $1,000, lock them in their contract and then your, your, you know, your landlord can go with and take the money out every day, right? Which means, as your employer, I need $1,000 and, as the renter, you need $1,000 and we both need to lock them and then we both need to go and withdraw the money and take it out with superfluid. I can connect my income as a company to my salaries and you can connect your salaries to your rent, so the money is flowing through our accounts and we don't need to do any of those withdrawal operations. We don't need to lock the money and basically it's a lot more efficient because of those things. Right, the money is just flowing and you can connect any number of streams, so I can receive money from my subscribers, I can stream money to all my employees and all my employees can stream money to all the things they want without making any liquidity movements, because that is handled in the protocol level through this system of interconnected liquidity.
BFG: 28:31
Great. So, okay, that's actually a great example. Yeah, I, because I've noticed, when I was opening the streams, basically, I think there was one warning saying you know, you just need to have enough money in your wallet from which you are streaming for the next, basically second, stream. So if you can be coming, you don't need the whole thousand, you can start with 100 or whatever, and when the money comes it appears there. Okay, all right, that's pretty neat advantage, I have to say.
0xFran: 29:08
Nicely done I think it's the only way this actually drives efficiency. If you look back enough on Twitter, I actually was bashing those other products Before starting superfluid. So not as a competitor, not as a competitor, I was doing it as a user. I was like guys, I don't think this makes sense, because if I have a thousand dollars and I want to give you a thousand dollars, then I'll just give you a thousand dollars. Like, streaming them doesn't add efficiency, right, but it does add efficiency if I can stream money to you as I receive it, because then I'm actually moving the money faster. So, yeah, I think it's a very meaningful difference. But yeah, the market will tell us Right.
BFG: 29:56
Cool. Any last words? I would definitely recommend everybody go and check superfluid and open the stream, because you've never seen money rolling to your account that fast. I can bet you that and yeah, it's actually very cool. So, any last words how can people go? People go, be helpful.
0xFran: 30:21
So I would say, if you're a user, join our Discord. You know we're always posting stuff that our ecosystem applications are building and you know there's a lot of stuff that you can go and try right now. If you're a builder, if you're a developer, then you know I want to make it very clear that everything we do is open source, so you can go, you can check the code, you can figure out how it works, you can use it in your own products. It's, you know, open for builders. So we're supporting our developers all the time to build really cool stuff. We have a monthly hackathon, so if you want to build something, you can build it, you can present it and win a prize every month and you know, generally speaking, we want to see what you will do with this. Like, we're very excited to help developers build cool experiences using streams to help enable, you know, all these kind of things that we've been discussing.
BFG: 31:14
Awesome, awesome. Well, thank you very much for making the time, Fran.
0xFran: 31:19
Yeah, thank you for inviting me.
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