Payment protocol Solana Pay has introduced a new transaction system that allows requests from developers and merchants, making commerce and peer-to-peer economy on-chain. Solana Pay was originally launched 3 months ago to usher in a new era of payments and commerce for the decentralized and open economy.
- Solana Pay has released transaction requests, therefore enhancing the shopping experience
- So far only Phantom and support them, but more wallets are already working on it
- Solana DeFi dapps are performing well amidst a market slowdown
- NFTs on Solana are starting to show signs of life
Introducing two-way token transfers
Until now, Solana Pay has relied on simple one-way transfers of SOL, USDC, NFTs, and other tokens, which provided a great starting point to enable decentralized payments. With transaction requests, it’s possible to bring any Solana transaction into the real world through an interactive request between a checkout app and a mobile wallet. ThisWhich enables NFT minting, dynamic discounts, tokenized loyalty programs, and more.
The core premise behind Solana Pay is that the payment and underlying technology go from being a necessary service to an actual peer-to-peer communication channel between the merchant and consumer. In the wild, the process would work something like this:
- The customer scans a merchant QR code, which their wallet app interprets as a Solana Pay transaction request URL.
- Then the wallet makes an HTTP request to the merchant API.
- The merchant receives the wallet address in the request and can respond with a customized transaction for the customer.
- The wallet shows the transaction details to the customer just like any other transaction and can also display a merchant URL and icon.
- Finally, the customer approves (or declines) the transaction, signing with their private key and sending the transaction to the network.
How is Solana Pay useful?
In a nutshell, transaction requests boost the power of simple purchases, allowing any possible transaction on Solana in the real world. This might sound amazing for reasons not fully understood, so let’s bring this into the real world for a minute. For a merchant, it can look like this:
A new customer walks into your store looking for the latest hyped sneaker collection. You have it in stock, and they’re thrilled. The buyer pulls out their phone and scans the QR code on your point-of-sale for a seamless transaction. The funds hit the merchant account at the speed of sending an email, at near-zero cost, and immediately begin earning high-yield interest.
Before the customer leaves the store, two tokens appear in their digital wallet. The first is an NFT version of their new sneakers, usable in any game or virtual world. The second is an authenticated NFT receipt, which admits them into your exclusive online community of verified sneakerheads. Therefore, they could now in theory be a customer for life.
Twelve months later, the next version of their favorite sneaker is released. Their digital wallet has a new offer reminding them of their availability at the store and a personalized recommendation on new laces they can’t find anywhere else.
Bringing crypto into the mainstream
Designing a system with a cohesive payment experience that rewards loyalty, drives repeat visits, and doesn’t cost a fortune is certainly not a walk in the park. However, Solana Pay brings it much closer to reality.
Aside from the increased trust between customer and merchant, Solana Pay will also allow sellers and service providers to tailor new products and promotions. This, in turn, will enable them to build even stronger connections with their customer’s thanks to custom offers.
At the moment, this type of tailor-made experience is possible to some extent. However, having access to a transparent LEDGER with all transactions a customer makes, gives merchants more data to work with. In this sense, they can anticipate their customers’ needs better and offer more appealing products to individuals based on their previous activity. While the global adoption of cryptocurrencies and digital currencies is still far away, Solana Pay moves us one step closer.
Start building with Solana Pay
Transaction requests are now live and available for developers and merchants to use. This can for example provide the building blocks for merchants to start building out experiences with customers designed to create loyalty and better targetting. Phantom and support them today, and more wallets are already working on it. Devs can read the spec here, configure the Point of Sale app to use transaction requests, read the merchant integration guide, and join the Solana Tech Support Discord. There’s also a tutorial available from Pointer.
The above does not constitute investment advice. The information given here is purely for informational purposes only. Please exercise due diligence and do your research. The writer holds positions in various cryptocurrencies, including BTC, ETH, and RADAR.
