Michael Schonfeld, developer evangelist at Dwolla. Money and the Cloud: It's all just data streams, anyway. Moving money should be just as easy as moving bytes. So why do we keep struggling with 40 year old COBOL-written financial systems? Could this be why Bitcoins have picked up all this momentum? Come take an inside look at how Dwolla is changing a long-stagnated banking industry that is governed by ancient misguided notions of profit.

1. JUN
18
Money as a Data Stream
Michael Schonfeld / Dwolla
At All Things Cloud 2013
DWOLLA

2. HOLLER
MEH.
BEST WAY TO
REACH ME
OK WAY TO
REACH ME
@BaconSeason
michael@dwolla.com
dev.dwolla.com

3. Are they Broken?
PAYMENTS

4. Text To...
(208) 944-4555

5. “...Fundamentally,
it makes no sense that money loses
its value when it exchanges hands.”

6. How much does it cost
to produce a $1 bill?

7. How much does it cost
to produce a $1 bill?
9.6¢

8. WASTE
PHYSICAL, PRINTED
Money $
Where does it come from?
MATERIALS
LABOR
SHIPPING

9. DIGITAL
Money
01010011Where does it come from?
SERVER / DB

10. How much does it cost
to produce a virtual
dollar?

11. How much does it cost
to produce a virtual
dollar?
Linden: 0¢
Ven: 0¢
....
BTC: 0.02¢ (depending of difficulty level)

12. SMS
1. From
2.To
3. Body
Data Packets

13. SMS Money
1. From
2.To
3. Body
1. From
2.To
3.Amount
Data Packets

14. The transfer of Money
The transfer of Data
Bottom Line:

15. $10.00 $9.40 $8.80 $0.00
Erosion of Money
(using credit cards)

16. Why?
INTERCHANGE

17. 4
Still Hard to Implement
Massive Infrastructure + Bureaucracy
Main Reasons
3
1
2 Legacy Support; Started in the 30’s
Fraud, Fraud, Fraud
INTERCHANGE

18. Sheer incompetencyMany Middlemen16 Digits
Fraud
More Features.
Sigh.

19. DevelopersRevoke AccessAggregated History
Bad Implementation

20. Bottom Line
INTERCHANGE 2.9% + 30¢

21. Maybe Okay?
Not Okay.
Milk: $2.50 = ~ $0.40
Car: $20,000 = ~ $580
2.9% + 30¢

22. Enter

23. WHERE?
Most of our employees work out of Des Moines, IA.We also
have people in MO, NY, and KS.IN A NUTSHELL
3
1
2
WHAT?
A payment network w/o interchange. Anything under $10 is
free.Anything over $10 costs $0.25 to transfer.
WHY?
Because interchange fees suck. Money should not lose value
when it exchanges hands.

24. Your bank
DWOLLA
Receiver’s bank
A cash based payment network. No credit cards - only Bank to Bank transactions.

25. Driven by DevsRESTful APIMobile
Cool Stuff

26. OAuth ApproachNo 16-Digits
SECURITY

27. OAuth

28. $10.00 $9.40 $8.80 $0.00
Erosion of Money
(using credit cards)

29. $10.00 $10.00 $10.00 $10.00
Erosion of Money
(using Dwolla)

30. Behind the Scenes

31. 4
Built in the 60’s; Still used today... Ring a bell?
Moved $32 Trillion in 2012
3
1
2 Slow 3 Biz-day Turnaround
Insecure Protocol
Automated
Clearing
House

32. FAST
A.C.H.
CHECK
SAFE
MOBILEThe Other Side
FiSync
CASH

33. FASTER
Money moves instantly between any 2 financial institutes.
FiSync
3
1
2SAFER
The FI must first verify identifying information of the sending
account.
ECONOMICAL
Same price as ACH.

34. Let’s Code.

35. THANKS michael@dwolla.com
@BaconSeason
dev.dwolla.com

36. &AQ