The Future of Blockchain Payment Infrastructure: In-Depth Interview with PolyFlow Co-founder Raymond

The 2008 Bitcoin white paper described a peer-to-peer electronic cash payment network that does not require a trusted third party. Although the industry has invested heavily in developing Blockchain infrastructure over the past decade, most of the current infrastructure is still built around transactions, which cannot truly support the real-time and scalability of payments, hindering the widespread adoption of Web3 payments.

So, what kind of infrastructure do we need to support real-world payment scenarios? What is the value and significance of PayFi?

This article features an in-depth interview with Raymond, the co-founder of the PayFi infrastructure PolyFlow, exploring his comprehensive thoughts and practices on digital finance, as well as his profound understanding of digital currency and Blockchain technology.

1. The Original Intention of Establishing PolyFlow

PolyFlow is the infrastructure layer of the Blockchain network, aimed at integrating traditional payments, Web3 payments, and DeFi, processing real-world payment scenarios through a decentralized approach. PolyFlow will serve as the infrastructure for PayFi, driving the establishment of a new financial paradigm and industry standards.

1.1 The Core of Financial Transactions

In traditional financial markets, any financial transaction and value transfer cannot be separated from the flow of information and the flow of funds:

• Information Flow: The information in the transaction process, including the collection of transaction initiation, payment, and settlement instructions, ensuring the accuracy and timeliness of the transaction.
• Capital flow: The entire process of fund transfer among parties during the transaction phase, focusing on the actual flow of funds.

1.2 Information Flow and Capital Flow in a Cross-Border Context

In the context of cross-border transactions, the pathways for information flow and capital flow are different. For example, SWIFT focuses on the transmission of information flow and does not involve capital flow. Capital flow still needs to circulate through the financial intermediary institutions of various countries, involving a complex clearing system.

1.3 Promote value circulation through PolyFlow

The core concept of PolyFlow is to separate the flow of transaction information from the flow of funds through modular design, using a decentralized approach to make each process of the transaction more compliant with regulatory standards, eliminate custodial risks, and connect to the DeFi ecosystem.

PolyFlow has launched two key components:

• Payment ID (PID): Associated with information flow, achieving user identity recognition, compliance access, privacy protection, and other functions.
• Payment Liquidity Pool (PLP): Associated with cash flow, managed by smart contracts for funds used in payment transactions.

2. PID - Linking the Physical World and Digital Currency Wallets

PID is a decentralized ID that can be bound to encrypted user KYC/KYB information, linking multiple platform verifiable credentials to achieve:

• Compliance Access
• Privacy Protection
• Data Sovereignty
• AI-driven

The PID goal is to link the physical world and digital currency wallets, similar to physical wallets that can hold cash, photos, identification documents, and other contents.

3. PLP - Consensus of Pooling Fund Flows

PLP is a product of fund flow splitting, and the smart contract address is used to receive transaction funds, achieving on-chain custody. PLP can achieve:

• Decentralized Custody
• Liquidity Pool
• DeFi compatible
• No-risk RWA yield

Raymond explained the goal of PLP in consolidating the consensus of capital flow through three settlement models of Web3 payments:

Peer-to-Peer Mode

Blockchain-based Web3 payments can achieve synchronized confirmation of transaction information flow and capital flow, but it is difficult to meet high-frequency trading demands.

3.2 Hedging Mode

In traditional finance, the transaction information flow and the capital flow are ultimately consistent but not synchronized. PLP achieves cooperation without the need for third-party trust endorsement by consolidating funds on the same Blockchain ledger.

3.3 PayFi Model

After forming a consensus on the unified ledger of Blockchain capital flow, innovative financial paradigms such as Buy Now Pay Never can be realized.

4. The Value and Significance of PayFi

PayFi aims to promote the application of digital currencies in real-world scenarios. Raymond believes that the essence of PayFi lies in effectively separating transaction information flow and capital flow, forming a consensus on the capital flow in the unified ledger of the Blockchain, and improving the overall efficiency of the Web3 industry.

5. Beyond Payment

PolyFlow is integrating the transformative power of digital currency and Blockchain technology to create a new decentralized PayFi crypto payment network, promoting a shift in innovative financial paradigms and unlocking the true value of Web3.