As blockchain and DeFi gain recognition and increase in popularity, their initial purpose should not be forgotten: democratizing payments and eliminating intermediaries in transactions.

While significant progress has been made in making blockchain and decentralized transactions more efficient and convenient, actual usage remains somewhat obscure to the average web user. For example, the crypto world still seems complex to small and medium business owners, who may experience prejudice or difficulties in adopting cryptocurrencies as payment methods, leaving them with few options to avoid traditional banking institutions and online payment processors, despite the high expenses these entail.

Fuse.io was founded with the goal of bringing simple and democratic crypto payments to the masses. The company has built an intuitive platform that functions as a middleware layer, offering relay services such as gasless transactions for merchants and users.

In our interview today, we will be speaking with Mark, CEO of Fuse.io, about the problems of the traditional payments industry. Built on infrastructure predating the internet, the current system is unnecessarily expensive, exclusive, and controlled by an elite group of companies. With Web3 promising to fix this, Fuse.io is tackling directly the fragmented nature of the payments industry, both in traditional and Web3 contexts.

Hello Mark, and thank you for joining us. You’re often quoted calling traditional payments “fragmented and dysfunctional.” Can you elaborate on the specific ways in which this fragmentation manifests and why it presents a problem?

MS: Traditional banking institutions and online payment processing companies are inefficient: they cost businesses and consumers high fees while their security level remains moderate. Not to mention their limited reach, leaving many parts of the world without access to essential financial services.

When it comes to remittances, a multitude of intermediaries drives up costs, acting as toll collectors and adding little value to the consumer experience. The primary methods for transferring money—bank-to-bank transfers and private remittance channels like Western Union and MoneyGram—are neither quick nor cost-effective for the average user.

Most global transfers and transactions are still handled by conventional banks and payment processors that charge hefty fees. Add to this the issue of millions of unbanked and underbanked people all over the world and the problem is compounded tenfold. We talk of a decentralized Internet and higher penetration of basic financial services but the reality is much different and this has to change.

But aren’t Web3 payments and UX just as dysfunctional? Dozens of blockchains, tokens and systems to pay with make it kind of a nightmare — how could this change?

MS: At present, there are three main key problems impeding retailers from accepting cryptocurrencies and therefore staggering general adoption:

One, the high volatility. Currently, the extreme volatility of the market makes it difficult for retailers to fully adopt cryptocurrencies as a payment method. But as the market grows and matures with public investment vehicles and more regulated investment channels, Bitcoin and other cryptocurrencies can evolve into a legitimate payment method that is widely adopted by retailers.

Two, the lack of technical know-how. Operating with cryptocurrencies requires a certain level of technical know-how. This would require searching for or training employees capable of operating with wallets, addresses and exchanges.

Three, the regulatory framework. Blockchain is still a nascent technology and the cryptocurrency sector is largely unregulated. This poses a risk for merchants and retailers. However, this is rapidly changing with more governments and regulatory bodies pushing for legitimacy and trust in terms of cryptocurrency consumer application.

It’s well known that traditional credit card processors levy quite high fees, it’s just that we as consumers don’t realize their extent. And yet, we don’t see a torrent of merchants adopting crypto. Why is that?

MS: There are various reasons why retailers are still slow to adopt cryptocurrencies as a payment method despite it resulting in missing out on a great deal of customers in the growing crypto community. This entire new market of people who own all kinds of cryptocurrencies are actively looking for ways to spend them. However, the gap between customers and merchants in this sphere is still huge. Current government regulations (or lack thereof) and restrictions of cryptocurrency transactions are keeping these new digital assets from becoming a widespread payment method It is therefore crucial to educate and encourage businesses to adopt a forward-thinking attitude and to overcome the prevailing misconceptions that surround cryptocurrencies.

Compared to newer Web2 payment systems in other countries like China’s AliPay, East Africa’s M-Pesa or others, do you think using crypto offers a significant advantage?

MS: Absolutely. Cryptocurrencies are an innovative and increasingly popular payment method that integrates easily into any merchant’s API. This in turn allows e-commerce businesses to accept a variety of cryptocurrencies and convert them without the high fees and long waiting times associated with traditional exchanges. It carries only very low charges for transactions, compared to centralized alternatives.

Do you think with the current political climate, crypto-based payment rails would find support from regulatory bodies and governments?

MS: Achieving regulatory and government backing for crypto-based payment rails would be hard. Despite growing acknowledgment of cryptocurrencies and blockchain technology's potential for efficiency, transparency, and financial inclusion, most governments don’t agree on an approach towards standardization and regulation of cryptocurrencies.

Security, money laundering, and the volatility of digital assets understandable make governments and authorities apprehensive. But more countries are integrating digital currencies into their financial systems, causing a gradual transition. Some central banks are testing Central Bank Digital Currencies (CBDCs), demonstrating a readiness to regulate blockchain technology.

Crypto startups and payment protocols must prioritize compliance, consumer protection, and security to achieve regulatory backing. The crypto sector and regulatory agencies must work together to address these issues and create secure and transparent frameworks.

While there are challenges, I believe that regulatory bodies and governments can support crypto-based payment rails with continued dialogue and cooperation, especially as they recognize the technology's potential to improve financial systems and boost economic growth.

What is Fuse’s strategy for tackling the challenges of growing a Web3 payments system?

MS: Fuse is a specialized Layer 2 platform that eliminates all the issues associated with the conversion of crypto currencies into fiat currencies and integrating them into traditional Web2 frameworks. As a B2B2C decentralized solution, Fuse Network has multiple layers and components to empower businesses to tap into the crypto market and tools to allow consumers to manage their funds, transact online and convert fiat and crypto currencies quickly and securely. All the transactions across this platform are done in a fast and instant manner secured by an escrow protection mechanism.

What do you think existing Web3 platforms are doing wrong — and what are they doing right?

MS: Web3 platforms are driving digital transformation by delivering novel solutions and redefining how people engage with technology. However, they must overcome a number of difficulties before they can achieve widespread use.

The user experience is severely lacking. Many platforms have extensive onboarding processes that include private key management and digital wallets, which can be intimidating for newbies.

Scalability is another major concern. During busy hours, users frequently face large transaction fees and sluggish processing speeds, which might discourage participation and impede the growth of decentralized services.

Furthermore, interoperability remains a challenge. Many platforms operate in silos, preventing smooth asset and data interchange between blockchain networks. Security worries are also widespread. Despite decentralization's potential for increased security, vulnerabilities and breaches have highlighted the need for stronger security measures and standardized auditing processes to foster user trust.

With this in mind, decentralization is a key feature of Web3 platforms. They empower people by giving them more control over their data and digital assets, minimizing dependency on centralized authorities, and advocating for a more democratic digital environment.

Greater financial inclusion is a significant benefit, with Web3 platforms eliminating entry barriers and increasing access to financial services for underprivileged groups, particularly in areas where traditional banking infrastructure is weak.

Furthermore, innovation and adaptability are driving forces in Web3. The open-source nature of these platforms encourages creativity and collaboration, allowing developers to construct a wide range of decentralized applications that address a variety of requirements, from financial to entertainment.

Finally, community involvement provides a substantial advantage. Web3 platforms frequently leverage decentralized governance models, such as DAOs, to let users participate in decision-making and build a sense of ownership and involvement.

Overall, Web3 platforms confront issues in user experience, scalability, interoperability, and security, but their strengths in decentralization, financial inclusion, creativity, and community participation position them as revolutionary forces in the digital ecosystem. By solving these concerns, Web3 can continue to create substantial change and broaden its reach.