
Launch HN: Multis (YC S19): online business bank account for cryptocurrency - tsahaghian
Hi HN,<p>We&#x27;re Théophile and Thibaut, and we&#x27;re building Multis (<a href="https:&#x2F;&#x2F;multis.co" rel="nofollow">https:&#x2F;&#x2F;multis.co</a>): an online bank account designed for companies holding cryptocurrency. We&#x27;re helping them store it, spend it and earn interest.<p>We have been in this industry for the past 3 years. Thibaut used to lead sales at Stratumn, a Nasdaq-backed company helping companies securing their shared workflows through cryptocurrencies. Théo built several decentralized applications before starting the company in 2018.<p>Wallets are the cornerstone of the industry: you need them to store and transact with cryptocurrencies. But these wallets are not designed for business. You cannot perform simple business operations like running a payroll, paying vendors, or earning interest, which you can currently do from your modern business bank account.<p>Cryptocurrencies - and particularly stablecoins - are a reliable, fast and cost-efficient medium of exchange. It’s a technology that enables anyone to move value and assets across borders, with no intermediaries. We believe it can help companies save a lot, since most of them are now actively transacting with partners abroad, from suppliers to foreign contractors.<p>The number of companies building and transacting with cryptocurrencies is growing (e.g. Stateofthedapp listings grew by 250% since 2017), despite still being in its infancy. Most of these companies are operating in the cryptocurrency industry, or are e-merchants willing to reduce payment fees and optimize working capital.<p>These companies struggle to manage their assets and make the most of them. They typically have between 5 and 10 wallets, none of them being designed for a business environment. This makes business spending and accounting still to painful and time-consuming. And cryptocurrencies sit idle, because there are just too many frictions.<p>We realized what was really needed: an application to manage cryptocurrency the same as a modern online business bank account, with features and financial services powered by both crypto and traditional currencies. In short, a crypto-first bank. Here are our main features today:<p>- Store - multi-user wallet with dashboard and transaction history<p>- Pay - spending policies and streamlined payment flows (1)<p>- Exchange - swap 70+ tokens with ethers, dollars and euros (2)<p>- Earn - savings account yielding interest on stablecoins (3)<p>- Soon: EUR and USD bank accounts<p>We will make revenues through commissions on financial services like fiat ramps, and through monthly subscriptions for premium features like accounting exports or fiat accounts.<p>Our goal of making a unified front end that works like a business bank account is challenging to achieve because the technologies we&#x27;re using are very heterogenous:<p>- we have two databases: the Ethereum blockchain and Cloud Firestore<p>- we have two backends: smart contracts and Firebase Cloud functions<p>- we have two authentication systems: private keys stored on individual wallets (we&#x27;re self-custodian) and email addresses<p>- we have two authorization systems: the multisignature contract owners and the owner&#x2F;guest roles in our security rules<p>- we have two type of assets: cryptogoods and traditional currencies<p>- we will have two storages: IPFS and Firebase Storage<p>You can read more here about our architecture (4) and our approach to security (5).<p>Cryptocurrency is still a recent technology that generates understandable skepticism.The ICO craze did not help. We feel that payment is becoming a tangible use case though, and companies ranging from Facebook to JP Morgan are now actively investing in it. We believe more will join. There are still many uncertainties about regulations, accounting, and each new SEC or FinCEN guidance make the teams&#x27; hair turn grey. But things are moving forward on the ground, despite the excess of hype in the space.<p>We want to make Multis useful, so we have one question: what would be the key features and financial services you would expect as a company? They don&#x27;t have to be related to crypto directly. We&#x27;d also love your feedback, your questions and your ideas. Thanks!<p>(1) <a href="https:&#x2F;&#x2F;medium.com&#x2F;multis&#x2F;introducing-direct-transfers-a-new-way-to-streamline-crypto-spending-with-your-team-ab44945e5a5e" rel="nofollow">https:&#x2F;&#x2F;medium.com&#x2F;multis&#x2F;introducing-direct-transfers-a-new...</a><p>(2) <a href="https:&#x2F;&#x2F;medium.com&#x2F;multis&#x2F;multis-launches-first-token-swap-catered-to-companies-with-kyber-integration-8eaae3977d40" rel="nofollow">https:&#x2F;&#x2F;medium.com&#x2F;multis&#x2F;multis-launches-first-token-swap-c...</a><p>(3) <a href="https:&#x2F;&#x2F;medium.com&#x2F;multis&#x2F;our-new-compound-integration-lets-your-company-earn-interest-on-crypto-80e7f4379b7d" rel="nofollow">https:&#x2F;&#x2F;medium.com&#x2F;multis&#x2F;our-new-compound-integration-lets-...</a><p>(4) <a href="https:&#x2F;&#x2F;medium.com&#x2F;multis&#x2F;imagining-a-leaner-way-how-to-ship-a-highly-dynamic-webapp-as-a-static-website-5088f83c3813" rel="nofollow">https:&#x2F;&#x2F;medium.com&#x2F;multis&#x2F;imagining-a-leaner-way-how-to-ship...</a><p>(5) <a href="https:&#x2F;&#x2F;medium.com&#x2F;multis&#x2F;security-at-multis-9609d346c91b" rel="nofollow">https:&#x2F;&#x2F;medium.com&#x2F;multis&#x2F;security-at-multis-9609d346c91b</a>
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ike0790
This is a very interesting approach of merging crypto with the legacy system.
Good luck in your endeavours!

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twww
thanks a lot - yes we think that having fiat and crypto side by side can be
interesting :)

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jatsign
Great idea!

Just this week I was approached by a recruiter for a crypto-app building
company that I know of and really like. I was (imo) a great candidate for them
skill-wise, but they only pay in BTC. And while I'm a fan of crypto, I have
bills to pay and they all want dollars. I don't want to deal with converting
to USD every paycheck and figuring out if I need to pay taxes, transferring to
my "real" bank account, etc.

I REALLY hope you all can help with stuff like that!

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twww
totally understand the hassle of figuring out how to pay taxes etc.

we definitely want to champion this idea of having fiat and crypto side by
side, and how to do it properly.

going all crypto might be too brutal and we think the hybrid approach makes
more sense: work for a company that pays you in fiat (for bills and legacy
stuff ;)) and crypto.

life is an experiment ;p

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stzup7
You need to be very careful when using the term "bank". It's a very sensitive
and regulated domain and depending on the countries you're targeting, you may
have to remove it entirely until you have the appropriate licences to use it.

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tsahaghian
You're absolutely right! We're still iterating on that one. "Banking account
for crypto and fiat" rather than "cryptobank" seems to be the right way to
mitigate risk for now (e.g. Mercury "banking built for startups"), but we
certainly want to be extra cautious.

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pyython
Very interested in testing out your product as it seems like it solves some
real painpoints of ours. Is there someone we can reach out to directly and
provide detailed feedback to after we have a chance to try it out?

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tsahaghian
We'd love to help and get your feedback! thibaut@multis.co

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deftnerd
You already mentioned payroll and vendors, so I think you're already thinking
of what I'm about to suggest... and then I might try to talk you out of it.

When I think of business cryptocurrency financial stuff, I also think of those
things. Employees need to be paid, and they might want their paycheck in
crypto or in fiat, or a combination of the two. Vendors that need to be paid
will usually just want fiat, either through some kind of fiat electronic
transfer, or a "bill pay" check that's printed and mailed.

The problem is that payroll is HARD. That's why banks, who handle business
accounts, don't do payroll and it usually falls onto specialist companies.
Given the "global" nature of cryptocurrency, many of your customers will
likely have employees spread across the world, which also adds payroll
complications when it comes to withholding, legality of cryptocurrencies, etc.

You might want to just partner with a payroll company otherwise you'll find
that most of development (business, software, and legal) will end up being
sucked into that blackhole side of the business that doesn't even have a high
margin.

Paying vendors? That's relatively simple in comparison. That's why most banks
DO provide bill-pay and transfer services.

What I suggest for your "secret sauce" is being very internal bureaucracy
friendly and give out employee corporate debit cards freely.

Build your system so when a business signs up, they can make accounts for all
their employees and managers and set up authorization workflows. If Bob in
accounting wants to buy a new chair, he should be able to submit the request
for the funds. If it meets various criteria (ex: less than $500, only needs
manager approval and not department head approval) and gets approved, then
your system makes the cost of the chair (plus some buffer) available on Bob's
wallet which has a linked Multis debit card.

If the business only provides debit cards to managers and up, then it would
make the funds available to the managers crypto wallet (and associated Multis
debit card) so they can purchase Bob's chair.

Lastly, if you put in place this support of business organization structure,
use the same structure for the multisignature systems. One of the signatures
could be Bob's manager, or maybe it would require the manager and the
department head, etc... But not Bob and his wife, who happens to be a manager
in an entirely different department at the business.

I've done crypto work before, and also have recently build a "corporate
bureaucracy friendly" authorization system for a SaaS I'm working on so
putting those two experiences together seemed natural :-)

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Geee
Payrolls are done by accounting, but they use an interface to the bank to make
the actual payments. It's usually a CSV file or similar, which is uploaded by
the accounting software, and has just the amounts and account numbers. Checks
are not used outside of USA.

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tyre
Having worked at ZenPayroll in the early days, I can say with confidence that
this is not true. Payroll is not handled by accounting software and it sure as
hell is not uploading amounts and account numbers.

As for paying people in crypto, we considered it (I was the engineer working
on it) and then we decided against it because it’s a terrible idea.

1\. Crypto transactions aren’t reversible so reversing fraud is impossible.

2\. Users don’t fully understand how blockchainy things work. Providing
customer support to explain wtf any of it means would be a nightmare.

3\. Users can’t use crypto for anything. I mean maybe buying illegal things on
DarkNet markets but other than that the entire blockchain ecosystem—billions
of dollars of investment—has yet to build a single usable product solving a
real problem.

4\. Currency changes value all of the time. What if someone can’t pay rent
because they were paid in Internet coins that lost value in the time between
their pay period and the end of the month? They’re just…kind of fucked? And
again, most people don’t really understand what’s going on here so “it’s their
fault” is a very uninteresting response. Don’t set people up to make poor
decisions with ramifications they don’t understand, even if we can absolve
ourselves of theoretical accountability on Internet forums.

5\. In the US you can’t pay people in whatever you want. These regulations
exist for good reason, back from when companies would try to pay people in
store credit. Is blockchain whatever a real currency or a narrow utility that
locks people in? Legally it’s a grey area (or was when we worked on it.)

Overall, it’s just a terrible idea. No one is sitting at home thinking, “damn,
I wish I could be paid in blockchain.” I mean, they kind of where when crypto
was going up and up and up and it was some speculative get-rich-quick pump and
dump, but not anymore. (And anyway, we maybe shouldn’t encourage people being
paid in speculative coins with no real-world uses? I don’t know.)

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tsahaghian
1\. Was fraud a big issue at ZenPayroll? I would assume this to be an issue
for fortune 500 companies, not smbs

2\. We're helping crypto companies for now - they get it. Hopefully non-crypto
people will get it too as crypto becomes mainstream :)

3\. e-merchants like Rakuten started accepting crypto. Amazon could follow.
Consumer apps offering higher interest rates than traditional banking could
also be compelling

4\. You're right! that's why we're bullish on stablecoins like USDC or DAI -
value is pegged to USD

5\. Still grey, but moving fast - you can now pay people with bitcoin as long
as they get minimal wage in USD. Paying bonus in crypto is an interesting use
case

~~~
tyre
Fraud isn't something you can worry about after the fact. There are strict
regulations around anti–money laundering and counter-terrorism that are less
about de-frauding an SMB then spinning up fake businesses and using payroll as
a conduit. The challenge with blockchain payments in payroll is anonymity and
irreversibility (two of its significant differentiators.)

At that point, what are the benefits? Transaction speed is one, but you only
really get that if the business pays in crypto (otherwise you still need to
wait for the ACH payment from them or float the money (don't float the
money.))

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tsahaghian
\- Is crypto really different from cash for this? Plus anonymity seems
relative now as agencies like Tracfin can track back addresses.

\- Our users generate revenues in crypto. Paying employees with it is just
convenient, faster, and cheaper when part of their staff is abroad.

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novalis78
Sounds like a very good idea. As a depository institution are you looking to
acquire a banking license (like varo did)?

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tsahaghian
Thanks! For now, we will partner with regulated bank infrastructure providers
- they have the licence. Just like neopbank players have been doing with
Synapsefi in the US or Solarisbank in the EU.

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giltotherescue
Glad to see you guys continually innovating. Wish you the best of luck. -Gil
from Gilded

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tsahaghian
thanks so much Gil :)

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dmitrygr
> Cryptocurrencies - and particularly stablecoins - are a reliable, fast and
> cost-efficient medium of exchange

May I respectfully ask for a citation on this statement's three claims please?

