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  • noahchonlee

How to Bring Credit Card Payments to web3 Crowdfunding Platforms


TL;DR

Accept the fiat and turn it into crypto, then send that crypto into the crowdfunding campaign on behalf of the user like so…

Option 1: Give the user the option to sign in using account abstraction into a dev-controlled wallet where you handle the transactions for them

Option 2: Track the transaction history on-chain through NFTs that are associated with a user's account (although a transaction did not actually come from that user’s wallet)


Intro

How do we accept credit card payments to web3?


This would result in 100x more reach for web3 crowdfunding platforms (# of credit card users vs EVM users)


Here are the best approaches we have decided to pursue at viaPrize.org that is generalizable to any web3 crowdfunding platform. 


Option 1: Dev-controlled/custodial wallets


Users may choose to create a crypto account or a basic account:

Crypto account (non-custodial) - an account with a self-sovereign wallet (ie: MetaMask)

Basic account (custodial) - an account which has a dev-controlled wallet associated with it (using just an email account and an OTP sent to that email—no need to know about secret keys or pass phrases)


If they create a “basic” account:


They may donate to a campaign with a credit card. That’s all the user sees.


Meanwhile, here’s what we do as a platform for them:

1. Accept the fiat to our bank account

2. Send from our bank account to a minting platform

3. Receive the minted stablecoin (such as Glo dollar) to our main platform wallet

4. Send from our platform wallet to the dev-controlled wallet associated with the user

5. Send from the user’s dev-controlled wallet into the campaign smart contract


Downside: 

-Users have given up control of a wallet

Upside: 

-They don’t even know what a wallet is, but they can still interact with dapps


Once a “basic” account has undergone KYC, they may claim shared custody of a walle (we give them the secret key and they may initiate transactions from their wallet directly, while keeping in mind another group has their secret key.)


Option 2: Mutable Data NFTs


Instead of controlling a user’s wallet, we could track the contribution “as if” it came from the user’s wallet. 


This means eliminating step 4 and sendin g crypto into the smart contract from the main platform wallet. Next, we track that the contribution came from a particular user in an NFT, even though the actual transaction did not come from that user’s wallet. 


Upside:

-User still has control of the wallet


Downside:

-A user did not actually send crypto to a smart contract from their wallet. This means that the NFT metadata is not the actual on-chain reality and it is simply what the platform is adding to an NFT.

-If the user wishes to use the same wallet in other platforms that recognize their transaction history, then the other platforms would need to read the NFT metadata instead of reading the actual transactions that the wallet made. 


In option 1, the platform takes centralized control of the wallets.

In option 2, the platform takes centralized control of the leger tracking what a user has done.


Our approach

At viaPrize, we plan to use both options. 


With option 1, it means we can embed other web3 platform crowdfunding campaigns into our front-end. The other platform/protocol doesn’t need to make any changes, but we can give access to their smart contracts to 100x as many people. 


For Option 2 to work, more platforms would need to recognize an NFT metadata standard. This may happen with projects such as Proof of Philanthropy and Hypercerts which we plan to integrate. However, for now most platforms (if they read a user’s on-chain history) will look at what their wallet actually did. 



We are also adding in gasless transactions, USD based stablecoins, and payments to usernames which mean sending funds in our platform will be as easy and familiar as sending money with PayPal.


We believe these developments we are building may bring massive benefits to the web3 public goods funding ecosystem including projects such as Gitcoin which has made our project possible.


We welcome feedback and potential collabs, thank you!

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