Request AMA in September 2022
Alexandru Stoicescu
Sep 12, 2022
14 min.
Hello Request frens 👋
Last week we held an AMA on our Discord where we had team members from Request Finance and Request Foundation come together to chat with our community. This session included topics about whether Request Finance should become more decentralized, updates on new features regarding escrow and Crypto2Fiat, Request Network tokenomics v2, and much more.
The session was divided between Request Finance, the application that allows you to easily manage your crypto invoices, expenses and payroll, and the underlying Request Network protocol.
Thanks to everyone who attended and participated by sharing questions before and during the AMA. For those of you who missed the session, below is a full transcript of the conversation.
Request Finance
1. Could you share Request Finance month over month growth in 2022?
Answer by Christophe Lassuyt
To put Request Finance into context , Request Finance is the application on top of Request Network that is helping companies to pay invoices, salaries and now expenses in crypto. And to answer your question directly, in 2022, a month over month growth on average was around 15%.
Even though we had more ambitious goals, the bear market made it challenging. Nevertheless with the current state of the market, the growth has been encouraging and positive.
2. Most traditional companies operate to produce an income stream (by selling a good or service). Many crypto projects also seek to do this, whereas some gain value in other ways (eg. adoption as a payment method).
Would you say Request Finance is more like a traditional company in that it offers a service?
And if so, how do you see it becoming profit generating when adoption increases in the future in order to keep encouraging growth
My understanding is that currently whilst a service is offered, it’s not profit generating?
Answer by Christophe Lassuyt
That’s correct. At the moment, Request Finance is a company. It’s to Request Network what Consensys was to Ethereum, and it’s not generating profit yet.
There’s only a very small fee at the moment that is more like a symbolic amount, capped at $2 per transaction.
To start, I think that all companies, including DAOs, seek to generate profit. There are many ways to generate profit.
Using Facebook as an example, they would generate profit by using data of people. Other times you generate profit because you charge customers by selling a product or service. Or because you make sure that people adopt your token and the token is increasing in price. Therefore you are making money.
Request Finance is no different and to be sustainable it needs to generate a profit. So basically the plan has always been for Request Finance to charge when we add value.
So we want to add value first for the customers. And, if we are successful then we will charge for the premium features. For example premium features like batching of payments, paying an invoice in a different currency, escrow, streaming, or even invoice financing in the future.
3. Request Finance currently relies on e-mail / password for its customers to access the invoicing application. How do you see authentication progressing in the future?
Is the goal for it to become more decentralized? Are you looking to integrate with any blockchain identity providers, have users authenticate with their own wallets, etc.?
Answer by Christophe Lassuyt
That’s a question we’re asking ourselves all the time.
Actually, when you build a business, it does not depend on you. It depends on the customers. So what do they want? What do they need? What’s going to provide them a great experience? How do they see the perceived value? And, how can the company extract a small part of this value?
So decentralization is not a goal by itself. I think Web3 is actually much more about interoperability and composability than decentralization.
If you have two bank accounts where your friend has a bank account, and you request a payment from him. And he’s going to be able to request from the bank account of another bank. That means there is interoperability.
But currently, this does not exist because the Web2 banks decide to work as silos. Therefore not working together, and not having interoperability.
In our case, if decentralization offers compelling value for users, we will build it.
We have this in mind because it will bring a compelling use case, if we add this to the email, logging. Then we are going to have both.
Answer by Ivan Hong
I think one of the interesting models of identity is to look at FTX and the way that they have this tiered authentication model.
So they allow users to add as much or as little elements of their identity verification as they want. But the more elements of identity that they add, they then qualify for higher tiers that unlock access to different features. For example, they can trade higher volumes.
So that’s entirely tied to what the added benefit of additional forms of identification are.
Whether they’re centralized or decentralized.
And what the value it would bring to the users at the end of day.
4. Request Finance success leads to REQ success, right? How can we invest in Request Finance?
Answer by Christophe Lassuyt
Of course Request Finance contributes a lot in building the Request Network ecosystem. For example, in burning REQ. And Request Network will have even more builders in the future. So there’s going to be even more contribution.
So basically Request Finance as a company is fundraising every once in a while. And that’s a way to invest in the company.
And then if you believe in the fact that Request Network, the underlying protocol and that this adoption mechanism where every time there’s a request that’s being created, then there are some REQ tokens being burnt, being invested in the REQ token is indirectly, being invested in the same success.
So most of us in the team, we have stock options of the company, but we also have REQ. We are invested in both success.
REQ is a deflationary currency, but not a deflationary currency like Bitcoin. It’s a deflationary currency based on adoption.
So the more adoption there is, the more deflationary the token is.
And so if Request Finance is successful, then the REQ is going to be successful as well.
And just to give one more info. Request Finance did raise some money in a seed round earlier this year. And it’s not looking for investors at the moment. Maybe if there are any VCs interested, we can talk again next year.
5. There hasn’t been much communication about batching transactions but it looks like a lot of work has been done. Will batching transactions be available on chains other than Gnosis Chain and Erc20? If so, which ones?
Answer by Christophe Lassuyt
I’ll start by explaining a bit more about what is the batching of transactions.
It’s the batching of payment request creation. So to put things simply, based on the adoption, we had too many payment requests in the same minute and it was hard to handle.
So batching the payment creation, the payment request creation is actually helping to scale the product.
And now we can do hundreds or thousands of payment requests in a few minutes, which is basically what RealT for example is doing. If you go on realt.co and you want to buy a piece of real estate in Miami for just like $50 and you choose to pay in crypto, you’re going to pay with Request Finance and doing this is actually now scalable and working well, thanks to this improvement.
It does not depend really on the chain where it is. It’s possible to batch payments whatever the currency is.
6. What chains will the escrow contract be available on? Will a user be able to gain interest on funds held in escrow?
Answer by Christophe Lassuyt
Again the method behind all this is we don’t really decide, we listen to customers.
But escrow today is on Ethereum. So if you want to use the escrow feature, most likely the first time that you are working with a client, you would like to be paid in advance, but the client does not want to pay in advance. So if you want to work together, you need an escrow.
Right now with Request Finance, it’s on Ethereum. We’ve got a few users, testing the product and we learn from their feedback.
And, if we need to have it on Polygon or another chain, we’re going to build it on other chains.
Thanks to the feedback of those beta testers and it’s the same for the next improvements, whether it’s including gaining interest on the funds held in escrow or something else, it will always depend on the customers feedback.
So that’s why we build only what people really want rather than what we think people want.
7. How utopian is the idea to utilize Request to facilitate international fiat transactions with low fees?
Answer by Ivan Hong
It’s not utopian at all. I think that cross border payments is one of the major use cases for stablecoins and crypto payment rails. And for example, payroll is one of the major use cases for Request Finance, and that’s a cross border use case.
Particularly for global payroll. If you’ve got 30 employees in different countries, it’s hard to pay them on traditional payment rails. When I was working for Filecoin, my money went missing for three months. And the banks just couldn’t figure out where it was. So I think that’s not utopian at all.
I think today it has been estimated that for about 10% of companies, something like 5-10% of their payments fail completely. And that’s not even talking about fees, settlement times.
If you’ve ever used Wise or any one of these enterprise payments accounts, even for Wise or PayPal, it’s incredibly time consuming. Every transfer is still a regular bank transfer, to a local bank account that Wise or PayPal has. If you’ve got 150 employees to pay, you’re just going to spend an entire day doing that one by one.
And that’s not even including the spread. So definitely not utopian at all, that’s a major use.
Answer by Christophe Lassuyt
And actually, among our biggest users of Request Finance, those are companies which are actually switching from the fiat payment rails to the web3 payment rails especially to save on the fees.
8. What’s the status on Fiat to Crypto and Crypto to Fiat?
Answer by Christophe Lassuyt
Actually fiat to crypto is live, it’s working. But not being adopted by hundreds of businesses. So it’s not a key feature at the moment. The crypto to fiat is close to the pilot stage actually.
So Crypto to Fiat, what we want to do is, being able to pay an invoice from your Metamask. So you are on your Metamask, you send money to a bank account and, within a few seconds, the money is received in Euro on the bank account.
And that’s something that would work, especially with invoices, super convenient for the payer, and that’s something that we are testing.
9. Plans and strategy for Q4 2022 and whole of 2023
Answer by Christophe Lassuyt
By the end of the year 2022, we want to have two new builders for Request Network. So 2 newcomers in the ecosystem. So that’s the goal. And to do that, of course we have a strategy. For example, what Umar explained, doing Requests for Proposals where we basically encourage people to build stuff.
Another thing is to basically reach out to the companies who could build their product with the interoperability feature of Request. And of course, there’s a huge incentive for them to do that because they would be able to benefit from the network effects of the network.
So basically benefit from the fact that there are other users, for example, Request Finance already on this network.
And the Request Finance goal is mostly about growth. The goal is to have a killer startup growing well, and as long as we keep users for a long time.
Request Network
1. Request Finance is built on top of Request Network Protocol. In which way is it a game changer?
Answer by Umar M Hassam
As Chris mentioned before, what’s exciting in web3 is the idea of composability. So where different apps can interact with each other, which is very different to the current siloed financial system.
In this current financial system, the goal is to have all your clients for yourself and not really to have the clients interact with each other. Hence having a capitalistic competitive system.
But with web3 and with Request Network, now 2 or three apps can interact with each other.
To give a very simple tangible example, let’s say if I use Request Finance to issue an invoice, at the same time I can send this invoice to another app and obtain financing for this invoice. This app would check my credit history before approving my financing and everything is being done through integrating the Request protocol.
This is why we think Request is a game changer. And, the vision really is to have a world where all invoices from the time it’s issued to payment, at some point they are interacting with Request Network.
2. Does Request plan to develop apps and services under a new brand at some point in the future, or will all development going forward fall under Request Finance?
Answer by Christophe Lassuyt
Everyone can build on top of Request Network and. First as a team, we don’t intend to build another brand.
Like I said before, Request Finance is to Request Network, what Consensys was to Ethereum. Request Network is building this ecosystem where there are interoperable apps on top of a payment request technology.
And, basically there’s going to be builders which can be companies, can be via hackathons, can be just 1 engineer building something. Actually there are a few things being built, as we speak by other companies.
3. What defines critical mass? How many transactions per day/week/month/year?
Answer by Christophe Lassuyt
The critical mass is related to token economics. So basically, critical mass is when there is enough to have an impact on the price.
So when the burn is so important because, either we increase the burn or because the volume increases, that there is an impact on the price. But to have an impact on the price, it depends on daily trading volume. So it depends on many different criterias and at the moment, it’s not substantial. So we know we don’t have critical mass. We will know we have critical mass when every time we do a burn mechanism, there is an impact on the price.
4. What’s the plan for tokenomics v2?
Answer by Christophe Lassuyt
We’ve been working on token economics and we understand that we need critical mass, because the system that we’ve got is one of the best systems. It’s very similar to the system of Ethereum. Ethereum being deflationary based on adoption. So it’s not the system that is to be improved, it’s the volume. And the REQ is already a deflationary currency based on adoption. So that’s what’s especially challenging for us.
We looked at all those projects who have liquidity mining in place. Having liquidity mining in place basically means that you create for example, 20% of tokens every year, and you distribute them to people. So you create an inflationary currency.
So if people hold the value without staking it, for example Luna and you don’t take stake it and you lose value. So that’s the problem of an inflationary currency.
With the REQ, if you don’t stake it, you don’t lose value. It’s deflationary, it’s the opposite.
So I don’t think it makes sense to do liquidity mining, especially, we saw that there are limits to liquidity mining.
But there are other things that we could do, like increase the rate of deflation, incentivize the builders, which we need to have very serious builders and we are working hard on it. Staking, once we have those many builders.
So the plan is actually quite simple but it’s challenging because we need builders and we need to build what’s necessary.
And I’m not saying we will never do liquidity mining, but so far we have decided to not do it.
5. Should Utopia Labs, OpenTreasury and Paysail also back their product with Request Network tech?
Answer by Omar Sebouai
Of course they should. As well as benefiting from the features that we have on the network, just like the escrow feature we just talked about or cross chain payments.
They would benefit as it would allow them to work with each other first and as well as other builders on the Request protocol.
For instance, someone could ask to get paid on Request Finance while the payer would pay on Utopia Labs. From a user experience point of view, users don’t have to use another product, they can use their own product.
I might also add that we identified a lot of different financial services that we want to onboard on the ecosystem, which means that every time we add a new service on the Request protocol, every other builder that takes part in it,will be able to benefit from it directly, whether it’s invoice factoring and/or other financial services like that.
6. How is the Request grants program going so far?
Answer by Umar M Hassam
To give you a quick update, so far, we’ve received two grant applications, these pertain to technical grants. What we’ve done since this is a new program, we’ve used these two applications to outline and refine our grant process where the main objective here is we try and assess the features utility for the protocol and whether the protocol’s usage is being optimized.
So far we’ve preapproved one grant that’s still currently work in progress. In the future we’ll also be creating and sharing open Requests for Proposal to develop some additional features that would enrich and enhance the protocol.
7. How are you planning to expand the Request Foundation staff? As far as I know, Request Finance staff count is greater than Request Foundation.
Answer by Christophe Lassuyt
That’s not how I would ask the question. I would ask, do we need to expand the Request Foundation staff?
First goal of Request Network is to decentralize as much as possible. So today, if you look at it, there are few people who are full time under Request Network, and we might argue that it’s not even necessary. What’s necessary is to have an ecosystem that’s running well.
So, for example, Ethereum is huge and they have like maybe 50 or 100 people. It’s a very, very small company compared to the market cap. And so, that’s the goal of any decentralized project. And the more we go to a DAO, the fewer employees there will be who are full time on the foundation.
So I would not ask this question, but maybe the question is, what resources do we need? We need more engineers and more builders. At the moment, we have many engineers because even if they are not full time, the Request Finance engineers, they know a lot about the Request Network protocol, and they build on top of it.
8. What would you like to see from the Request community going forward? Especially right now during the bear market.
Answer by Umar M Hassam
Even though we have not really announced this yet, one of the plans that we would have in the future is to launch some campaigns for some specific use cases of Request Network whereby we bring more visibility to one use case at a time.
So during those campaigns, we’ll come up with ways to incentivize the community. It could be anything from writing an article about this use case, and to share how the protocol can be used for that use case.
So if we have people who are enthusiastic about the project and who would like to participate in helping us promote that use case, that would be one way we could have the community participate during this bear market.
And we’ll come up with other bounty ideas for the community. If you have any bounty ideas, please feel free to let me know.
Answer by Christophe Lassuyt
I think the bear market is a very good time for consolidation, whether it’s at the level of community or at the level of product, because basically the ecosystem is not growing much, but it’s getting stronger. And then it’s going to grow again in subsequent months and years.
9. “The more we go towards a DAO” – What are the next steps towards this, i.e, what are prerequisites not given today that need to be checked until the next steps can be taken? Is this still a plan, seeing all the trouble DAOs went through in the past? (votes overruled, etc)
Answer by Christophe Lassuyt
So basically if we created a DAO tomorrow morning, the Request Finance and Request Network team would have full power over it. So we need more decentralization. We need more divergence of opinions. We need builders with different goals.
And we need builders asking for that. Why? Because they will need decision making to be decentralized, to make sure that they have some power over what is going to be built.
10. Any juicy news to share on the roadmap?
Answer by Christophe Lassuyt
NFT invoicing & NFT invoice financing is juicy news..
In a few words, there is a few ecosystem members, like Aave for example, who see Request as very promising especially because you could imagine that the recipient of an invoice as the owner of an NFT, and if he/she gives you the NFT, you’re going to be the recipient of the invoice.
So, what this means is if you’re supposed to receive $10k and you basically give your NFT to someone else, he will receive the $10k. So he can kind of buy the promise that he will receive $10k and that’s invoice financing. That’s one of the technical ways to do invoice financing.
There is nothing yet but it’s possible.
