How Finance Streaming Protocols Revolutionize Crypto Payments
This is a whole new paradigm of payment that opens a vast number of opportunities: it allows employers to automate payrolls, enables fair pay-per-second models, and reduces volatility while airdropping new tokens. The way finance streams work makes them beneficial for both senders and receivers.
The growing number of finance streaming protocols suggests that the way money is distributed may change in the near future.
Use Cases for Finance Streaming
Here are several areas of the crypto economy where finance streaming works best.
Payrolls: Automating recurring payments
Many companies find it difficult to find a fast and trouble-free method to pay their employees, especially when the team is spread across different countries. Cryptocurrency has become a go-to solution: there’s no need to wait for lengthy bank transfers and do tons of paperwork.
But what if you get tired of making multiple payrolls month after month for all your staff members, and want to set the process once and see it work automatically instead? This is what finance streaming allows you to do. Team members also profit from this model: they start earning right away and don’t have to wait until another payday to withdraw the money. All their salary is already at hand. Streaming also works perfectly if this is a temporary job and/or it is paid depending on the time spent at work.
Finance streaming allows for complete transparency and financial safety: both the sender and the receiver can see at any time how much crypto has been transferred. The stream can be paused or resumed at any time.
Vesting: Avoiding routine
The key features of a finance stream are its controllability and a dosed distribution of funds. This is why it works perfectly for vesting:
- Investors can gradually earn tokens for their support of the project.
- Supporters and employees can be easily and fairly vested with a set cliff period.
- Grant funds can be distributed progressively so that money is spent more rationally and the team doesn’t run out of funds prematurely.
Finance streams eliminate routine in vesting: once you set up the process, it runs continuously until you want to pause or stop it.
Pay-per-minute services: A fair play
Streams allow customers to pay exactly for the time they’ve been using a service. Thus they don’t lose their money on equipment rental, car parking, or co-working if they’ve already paid but hadn’t used the service during the whole period.
The same applies to subscription models: since you can pause the stream at any time, you pay just for the time you’ve been using the app. And this model has its benefits for businesses, too: developers can instantly see changes in user behavior and subscriptions when they implement changes.
Airdrops: Reducing new token’s volatility
Finance streams allow crypto projects to conduct airdtops without a rapid decrease in tokens’ prices.
Airdrops stand as a part of the marketing strategy — projects distribute their tokens to attract traffic and draw attention to their platform. But if the team sends out all its tokens at once, users may start selling them right away, thus dumping the price. Distributing tokens during 3 months or longer will help avoid instant sales and volatility. Thousands of users will receive their crypto transparently and, again, in a controllable way.
Game mechanics: Incentivizing users
Increasing the engagement of users is another thing that token streams can do. Here’s how it works: developers receive money proportionally to the time gamers have spent in the game, rather than their occasional purchases. This allows converting users from unpredictable to constant players and increases the time that they spend playing.
The money stream can be implemented here as a subscription or in-game assets rental. Besides being advantageous for developers, this model also reduces the entry point for users: they deposit funds for active play time only and don’t have the feeling they’ve paid for something they don’t use.
How Finance Streaming Works
Streams change the very nature of how money is paid. They let you pay continuously over a long period of time: senders and receivers track the money flow and can control it by halting, resuming, or stopping.
After you log in the streaming protocol with your Web3 wallet, you can set up a stream: set the token, duration, and wallet address of the receiver. From this moment, you can start sending money in real time. See the dashboard to track and control the stream. The recipient can withdraw the accrued funds at any moment.
3 Finance Streaming Protocols
Roketo
Roketo is a NEAR-based platform that boosts token utility through persistent, time-distributed transfers. It has attracted over 5,000 customers, made 7,000 streams, and sent over $1M of funds in only one year since its launch.
Roketo was created during the NEAR’s MetaBUIDL Hackathon in 2021 where it won the competition between young developers. In 2022, the service released its dApp, passed a 3-rd party security audit by BlockSec, and got $900K of investment.
Roketo can be easily built in any NEAR-based protocol. The service positions itself as a developer-first platform – it allows you to build and deploy with its detailed documentation and 100% open-source SDK (coming soon). Roketo makes it possible to build a range of new powerful DeFi products and financial instruments through token streaming.
It is an end-to-end solution for individuals and DAOs. Roketo gives full control over the finance stream to both sender and the receiver: the transfer can be stopped and resumed at any moment, and it is cryptographically guaranteed that the recipient will get their tokens.
Here’s how Roketo is different from other crypto payment services:
- Full control. Both a sender and a receiver have complete control over a finance stream: a transfer can be stopped and resumed at any moment, and it is cryptographically guaranteed that the recipient will get their tokens.
- For individuals and organizations. Roketo is an end-to-end solution that caters to individuals and DAOs.
- Low transaction fees. NEAR boasts gas fees of just a few US cents, so it costs less than $1 to set up a stream on Roketo. This makes it profitable to create hundreds of streams simultaneously, and receivers are able to withdraw funds multiple times.
- High speed. Funds accrue every second and can be withdrawn at the same moment they’ve arrived.
- Transparency. All members of the process see the dynamic of the money flow in the dashboard. Every stream has a unique URL that makes it easier to track it. This openness facilitates financial planning and tax payments.
- Simple interface. It takes less than a second to set up a stream – set the details in 3 steps and you’re good to go. Pause, resume, stop, extend streams at any moment. The history is available in stream details.
Sablier Finance
Sablier Finance is a streaming protocol that runs on the Ethereum network. It was developed in 2019 with grant support from the Maker protocol. Sablier’s smart contracts are simple as they only contain the information about the time of stream creation and recipient’s wallet.
The service allows you to get rid of the hassle of making payments over and over again. Once you make a one-time deposit and the stream starts, the money flows “without you lifting a finger again.” Receivers see how much they’ve earned in real-time.
One of the Sablier’s customers is Rook Labs, an organization working at the Rook Protocol. Their solution captures and redistributes MEV, or Miner Extractable Value (Ethereum's “invisible tax”), to the users and protocols that create it.
Rook Labs “is actually not a company” – but a team spread across the world, with some of its members working fully remotely. Moreover, some of the employees are anonymous, so even the platform’s CEO doesn’t know their names. This situation is problematic in 2 ways:
- The employer has to do a lot of manual work – create monthly payrolls for each of 30+ team members,
- Employees have to trust their project’s managers in terms of sending timely payouts.
Sablier allows Rook Labs to solve this problem. A stream created in just 30 seconds can run during the whole year, liberating the team from recurring paperwork.
Superfluid
Superfluid is a protocol that allows for creating programmable cash flows on the Ethereum, Polygon, and xDAI networks – the project calls this the “new subscription-based economy on-chain.” In 2021, Superfluid raised a $9 million funding round, which the platform will use to expand the team and build an entire ecosystem of new “real-time financial applications.”
The service lets you do multiple tasks in one single transaction – for instance, fund several projects at a time. This is possible with a Super Token, a Superfluid’s ERC-20 asset with increased functionality. Here's how it works:
- You mint a Super Token, for instance, DAIx on Polygon. This is done by upgrading your Dai tokens – the same way that ETH is transformed into WETH.
- To run the stream, you sign one transaction. Once it is confirmed, the money from your Superfluid balance starts ticking down and the tokens in the receiver’s account begin to tick up.
- Since there’s only one transaction, no gas is needed to run multiple streams or modify the existing stream.
The Future of Crypto Payments
Finance streaming is not just a handy feature. It’s a whole new vision of payments, a different paradigm that changes the way employees receive their salaries, users pay for services, and projects airdrop their tokens. As the Superfluid’s co-founder and CEO Francesco George Renzi believes, a new generation of crypto natives who will be paid in streaming money will emerge soon.
Besides Roketo, Sablier Finance, and Superfluid, there are many other players on different blockchains – LlamaPay on Ethereum, Calamus Finance on Polygon, and StreamFlow on Solana. The increasing number of finance streaming services may be the sign that the new trend in how crypto payments are made is emerging.
