Omise, a payment processor operating across Asia, revealed OmiseGO this week: an Ethereum-powered digital wallet that works without a traditional bank. The platform could serve the hundreds of million
Omise, a payment processor operating across Asia, revealed OmiseGO this week: an Ethereum-powered digital wallet that works without a traditional bank. The platform could serve the hundreds of millions of unbanked people scattered across the continent who lack access to basic financial services.
Wallets saturate Asia. Telecom operators run them. Fintech startups run them. Payment companies run them. Each operates in isolation. Someone cannot move money from a telco wallet to a startup's app. Wendell Davis joined Ethereum's founding team and now manages product at Omise's blockchain division. He identified the core obstacle. "There's a lot of big push for this idea of e-wallets. Everyone has mobile phones these days and everyone would like to be able to easily send money from point to point, to make payments. But it is very difficult unless everyone is on a common platform," he said.
Migrant workers stand to benefit. A Burmese laborer could push cash home to relatives. Peer groups could settle shared expenses. Shopkeepers could receive payments without fees. Donnie Harinsut leads Omise as co-founder and COO. He described the mechanics in a presentation video: "OmiseGO basically is a wallet where people can actually cash in and cash out even if you don't have a bank account."
Why Ethereum? Harinsut cited trust. "The reason why we chose blockchain technology is that we want to build a network that people can actually trust. For example, in Thailand, there is a lot of telcos that actually have their own wallets. But it's basically a closed loop wallet. We want everyone to have access to financial services, no matter who you are in society." Closed systems limit access and growth.
Davis used a parallel to cash. "Just like using cash, except it is a lot more convenient in a lot of ways. It's money in your pocket," he said. He elaborated on cross-border features. "What OmiseGO is able to do for the end-user is allow them to send money locally: they can send it to their family, they can make payments… It also allows them to send remittances across borders. So for example, maybe you are a migrant worker from Myanmar and you want to send money home back to your family." His summary of the goal: help users "move money around anywhere they want at the most minimal cost possible."
Omise itself has been running since 2013 from offices in Bangkok, Tokyo, Jakarta and Singapore. The company processes transactions for thousands of Asian merchants. Backers have invested more than $20 million, including 500 Startups, East Ventures, Golden Gate Ventures and SBI Asset Management. Jun Hasegawa is Omise's founder and CEO. He contended the company can deploy OmiseGO given its access to thousands of existing merchant customers. "We can say that Omise is very uniquely positioned to provide this type of financial platform. This is because we already provide our payment services to thousands of business users in Asia." Hasegawa described OmiseGO's potential to reshape banking for unbanked Asians. "Through OmiseGo, an open source platform, we can bring [the hundreds of millions of people in Asia who do not have a bank account] together and help them see what the bank of the future looks like in a way that reflects their present values."
Technically, OmiseGO comprises multiple parts: a decentralized exchange, liquidity provider mechanism, clearinghouse messaging network and asset-backed blockchain gateway. Davis highlighted a design tradeoff: open verification alongside private data. "The nice thing about OmiseGO's design is it allows a shared ledger while also preserving privacy. And this is something we think people are going to want. They are not going to want to expose their customer data and information to each other. But at the same time, they are able to verify and confirm that certain events have happened." The system permits customization to fit different business models.
Applications span multiple categories. Payment processing covers remittances, direct transfers and bill payment. Loyalty schemes can govern points and redemptions. Financial features include B2B settlement, supply chain logistics, lending products and savings accounts. The network opens to the public in the fourth quarter of 2017.
