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Loop, a new crypto startup, is working on making Web 3’s payment rails easier for its crypto-paying customers.
Recently, the firm has raised $4 million in Andresseen Horowitz-led seed funding, claims CEO Eleni Steinman. Steinman has formerly worked as a strategist at bloXroute Labs. Steinman and co-founder Shane van Coller have together developed Loop.
Both the founders left bloxRoute to tackle one of the most frustrating issues of the wallets that are stopping the growth of Web3, which is recurring payments. In order to pay in crypto, one has to sign the outbound transaction 12 times a year.
Many crypto firms earlier have tried to solve this issue, including Diagonal, MeanFi, and Superfluid. The priority of Loop as of right now is Ethereum.
Steinman explained that when DAO and multi-sig wallets are added to the mix, recurring payments become more difficult. Users are obliged to approve outbound transactions each time they pay since that’s how the crypto wallets work.
Here comes Loop! It lessens the burden on users and transfers the duty of processing from users to an automated smart contract. It will automatically release the given amount of crypto from the user’s account on receiving the permission, saving them the headache of recurring payments.
However, such an architecture can lead to security hacks that are quite common in the crypto sector. But Steinman claims that the smart contract in Loop will protect against exploitation. She explains that only the counterparty company has the right to debit user payments from Loop’s smart contracts. The smart contracts are hard-coded without “infinite allowance functions” to avoid draining the wallets. “No matter what, the contract can never take more from you than that amount,” Steinman added.
Offering A Token In The Spirit Of Decentralization
Steinman also revealed that “Alpha customers” are examining Loop’s system – called “templates” ahead of the public release scheduled in June.
The subscribed users however wouldn’t get a hint about the Loop’s seamless integration with “Pay with crypto” checkout buttons across the web. She explains that since it’s designed internally therefore people wouldn’t know that they are using Loop.
Although, as of now loop is not committed to a token, according to Steinman the company can further decentralize the governance behind its tooling by offering one.
According to a press release, Alchemy Ventures, CoinList, CoinList, and angel investors such as Nansen’s Alex Svanevik Pantera’s Paul Veradittakit, Lauren Stephanian, and Imran Khan took part in the round. Steinman believes Loop incubated with Archetype.
ALSO READ: US Is At The Back Of Developed Crypto Markets: Ripple CEO
Nancy J. Allen is a crypto enthusiast, with a major in macroeconomics and minor in business statistics. She believes that cryptocurrencies inspire people to be their own banks, and step aside from traditional monetary exchange systems. She is also intrigued by blockchain technology and its functioning. She frequently researches, and posts content on the top altcoins, their theoretical working principles and technical price predictions.
