We speak with Paul Ruiz, The PayPro's CEO, hatched in La Salle Technova, to know more closely the project and to understand all the new terms that have come to remain.
When is PayPro born?
As company, PayPro is born in 2015. The initial idea that we had was to do a technological bank, because we were considering that the banking of nowadays has two problems: one technician and one of culture of company. But, neither in this moment, nor the technology, nor the experience that we had, they were sufficient as to do a bank.
This way, you wanted to do a bank as he understands himself nowadays?
We wanted to create a bank which mission was to centre the client on the center of the relation and not upside-down. And thanks to the use of the technology, the barriers of entry have stooped the sufficient thing as in order that this aim is attainable.
For it, in PayPro we start by doing a tool that was allowing to do payments without secret commissions that were applying other banks. We close two cycles of investment, Telefonica invested us, we did a Crowdfunding, regulated ourselves as entity of payments for the Financial Authority of the United Kingdom and, ultimately, we ended up by managing approximately 500 thousand euros a month in transactions of 100 different companies (PIMEs) in Spain.
How has it evolved this tool?
At the beginning of year, for a series of contextual circumstances, we realized that it was the moment to evolve the model and doing what we wanted to do from the beginning: a bank. We discover that thanks to Ethereum, begun when come up applications constructed on his Blockchain, which allows to offer traditional services but with all the Blockchain's advantages. What we are called decentralized applications: DAPs. We saw that there were many DAPs offering bank traditional services, but taking advantage of all the Blockchain's advantages.
On the other hand, we would need a wallet connected to this Ethereum's network where the user could store any currency or any Token. If we have both things and make them united, we have a bank, with a great difference: that is going to be constructed on a decentralized application.
There are other 'banks' as PayPro that are doing the same thing?
No. There are neo banks (digital banks). That is to say, they use API to add services of the traditional banking and to offer them to a niche of market. The problem of this model not only is that is centralized and therefore it is vulnerable and expensive, but it is limited by the obsolete systems of the banking. It reverberates of negative form in the capacity of the Fintech to be able to offer services to the measure of the client. In PayPro we are very conscious of this problems since we have happened thereabouts. We are the first ones that we are going to do a bank levered up on Blockchain.
What is Blockchain?
Basically, it is a decentralized protocol that it allows to store, to transfer and to confirm transactions. This means that, ultimately, you have a record of transactions decentralized (his database is not in an alone servant, but it is distributed by all the computers connected to Blockchain of the world), that it allows you to manage it: transactions between the users of the network.
And with what type of ‘coin’ are transactions realized?
These transactions present a value, which is called a cryptocurrency. That is a coin that is virtual and that has the value that the market assigns him. The coin can be Bitcoin, but there are many more. Nowadays, Bitcoin has a capitalization of approximately 140 billion dollars and the total value of all the cryptocurrency that exist nowadays has a capitalization of 240 billion. Bitcoin has a dominant position but also there is a number of coins importantly enough inside the system.
How does this Blockchain revolutionize the bank sector?
Blockchain is the technology that is going to revolutionize all the industries: it is the Internet 3.0. Until 2013 we were thinking that only it was possible to use like lternativa to the systems of payment, but lately, thanks to Ethereum, a platform of applications on Blockchain, it is possible to use Blockchain in any industry. In case of the bank one, we it can use for insurance policies, give, Crowdfunding, including identifications of the clients, etc. Out of the bank industry, it is possible to use for controlling the costs in the commercial area. Also to control the traceability in the food processing industry, also to send the ID card of the citizens of a country, to manage the record of the property, etc.
What does more allow Ethereum?
Ethereum is a decentralized application that Smart Contracts allows to generate. A Smart Contract works as a machine of vending; when you put a currency, in this case a crypto-currency, he returns a token to you instead of a product in case of the vending. It allows to any programmer to create markets, to generate new services or basically, to develop on Blockchain any application for any industry.
What is a Token?
In case of Ethereum, a token is what is returned when a Smart Contract is executed. This token can represent any value that wants to give him. From allowing to unblock the payment of a Letter of credit, up to an action of a company.
How will traditional banks be able to coexist with this new system?
Normally in the balance always the truth is, is in the habit of being neither a thing nor other one. The banks will re-formulate his model of business towards a type of entity that offers a major degree of long-term safety and that, therefore, will offer services of guarantee and similar. That is to say, I do not believe that the banking is going to disappear, but if I think that it will have to re-formulate his place in a new ecosystem. It will not be 100 % like that, but one will find a balance and the future goes towards Blockchain, undoubtedly.
Then, will market be re-designed?
The market in the next 10 or 15 years is going to have to be re-designed, this is the clearest. It is probable that the banks re-define his model of business in response to the evolution that we have had. We probably place already in the sector more retail (economic sector) of the market, whereas they will place in the most corporate sector or that it has more that to see with the services of guarantee. With more transparency, safety, impenetrability, ultimately gives the power to the client.
PayPro, in Barcelona, is incubated in La Salle Technova. How does this opportunity come up?
Technova is one of the organizations or relating incubators in the sector startup of Barcelona. The community that they have created in the Technova is very good, des of the point of view of startups, of investors and of the events that are done.
In the MasterClass of November 30 that you will give in La Salle BCN, what will it consist? What we will find and what they can reach?
I think that the most important thing will be to explain Blockchain's application. Not as a system technology of payment, but a technology that can be implemented in any industry, with all the advantages that it has.