Lolli intends to make Bitcoin payments commonplace by providing incentives for shoppers and retailers alike.
The company CEO Alex Adelman discussed his master plan for getting Bitcoins into the hands of millions of people in a panel at a recently held Bitcoin 2019 Conference in San Francisco.
What is Lolli?
Lolli is a rewards platform that gives users Bitcoins when they shop online with more than 500 retail partners. It works as a browser extension – once installed and activated, users can carry on with their regular online shopping activities, but at the end of the process, they receive the cryptocurrency in their Lolli wallets. The incentive can be as high as 30% of the amount spent.
The company was founded by Alex Adelman and Matt Senter in March 2018, and its name was inspired by Adelman’s trips to the bank as a child. He recalls disliking those visits, but he was always looking forward to the lollipop at the end. “I believe Bitcoin is the bank of the future and all that’s missing is Lolli,” Adelman says on the company website.
Bringing value to shoppers and merchants alike
As the Lolli CEO explained during the panel, currently, merchants don’t allow Bitcoin payments because there are not that many people interested in using them for everyday transactions. However, he hopes to change that by providing benefits for both retailers and customers.
“When we think about: How are we going to have mass adoption for Bitcoin? It’s not just for consumers. It’s also with merchants as well. And if we want Bitcoin to be the rails, we have to think about: How is it better and to whom is it better for?” he said.
Currently, Walmart, who is one of Lolli’s largest retail partners, spends a considerable amount of money on credit card processing fees every year, just like other retailers do. This could be Lolli’s selling point, but Adelman feels that pushing the acceptance of Bitcoin payments isn’t the right move at the moment, since there are not enough customers who hold the cryptocurrency.
Rather than pressuring merchants to implement a giant technical integration into their payment systems, Adelman proposes incentives that both merchants and shoppers can get interested in.
Lolli signed Walmart as a partner by saying that the rewards program can attract more customers to the shop and by taking care of the integration process. “They don’t even have to touch Bitcoin. It’s just a thing for them to attract new customers,” said Adelman.
On the other hand, the rewards platform creates more consumers who own some Bitcoin and need somewhere to spend it. Adelman believes Lolli can create more supporters of the cryptocurrency by making it more accessible through his platform.
“When you can incentivize someone with something for free that, so far since we launched, has tripled in value, you start to train the savvy shopper,” he said at the conference.
Lolli’s Long Game
In the past, Bitcoin payments never got off the ground because the incentives targeted only merchants. Without consumers who would use the cryptocurrency, there was no point in setting up integrations for such payments, which led to a vicious cycle. However, Lolli’s rewards program has the potential to break it.
After a while, Lolli’s merchant partners could start accepting Bitcoin payments when on one hand, the credit card processing fees continue to cost retailers millions and on the other, the number of customers who shop at their stores regularly and hold Bitcoin increases.
“It gets really interesting because you have to reevaluate what they’re optimizing for. You start playing into those margins of the $5 billion worth of credit card fees, and you say, ‘Look. We have a million users that are shopping at Walmart. You’re spending, let’s just say, $10 million in credit card fees on those users. What if we saved you $10 million in credit card fees by accepting Bitcoin?’” explained Adelman.