Category Archives: Identity

Governance in Payments

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Long blog – Paid Content

Executive Summary

I’ve been writing about governance, trust, transaction costs and payments for a long time. In my view THE KEY to understanding how stablecoins, agentic, DeFi, Open Banking, tokenization and other payment innovations is governance. I seem to be the only one writing about it, so I don’t see a reason to stop now. Governance is the BIGGEST competitive moat for Visa and Mastercard, and its also the heart of their biggest break out growth opportunity. If you thought AI was transformational, radically reducing transaction costs (TCE per Nobel work of Ronald Coase) will dwarf it. In fact the monetization of AI is a Gordian knot of governance issues (see Agentic Commerce and Governance). 

Today I’m expanding on “value exchange” governance with 5 core themes.

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ApplePay’s 11th birthday in iOS 26 – What’s New?

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ApplePay turns 11 yrs old this month, a wallet that has gone from 0 to 84 countries and 11,000 banks. Hard to believe, my blog was the first to break the news of ApplePay in iPhone 6 back in 2014.  Back then I was on the advisory board of Money2020, and asked M2020 co-founder Johnathan Weiner to hold a place in the agenda for Apple Pay. September rolled around and we still had an “empty” slot, I told him to trust me. It worked out well, as Apple finally rolled it out on September 9th 2014.  There was so much innovation in the initial wallet from tokenization, provisioning, credentials in the secure enclave, … and of course the game of chicken Apple played with Issuers on their 15bs (in US, 7bps in EU see story). 

I just installed iOS 26 this morning, so what’s new in iOS 26 w/ ApplePay? 

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APIs – More Banks to Follow JPM – Pricing Implications

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As I stated in my Monday blog, Open Banking is dead in the US. Pay by Bank (and open banking) is effectively dead in the US. This follows JPMorgan’s move to push out its new API pricing structure to data aggregators and other third parties in the first week of July. This development comes as the “new” CFPB seeks to vacate its Section 1033 rule.

The latest is that we can expect most other major banks to roll out their own pricing within the next two weeks. These banks will have different pricing, as there was no coordination among banks. JPM has always been the most forward in protecting consumer data. A new pricing floor for data access has been established. Now that other analysts have weighed in, I can recap the pricing framework. 

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Stripe Acquires Privy – Link expands as Does Stripe’s “Gatekeeper” Position

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Stripe’s announcedits acquisition of Privy yesterday, web3 wallet infrastructure platform that enables developers to easily build and integrate secure, self-custodial wallets into their applications with well defined APIs (consistent with everything Stripe does). 

IMHO this signals an acceleration of Stripe’s strategy to dominate the intersection of eCom, wallets, Finance and stablecoin, with a likely product focus on embedding user-friendly stablecoin wallets directly into merchant checkouts and developer platforms. This will greatly expand and “juice” stablecoin adoption in eCom, particularly when combined with LINK. While it COULD present a slight challenge to cards, I don’t see near term impact there (per blog last week). US and EU consumers prefer card, merchants do as well (due to governance and customer support), ROW, micro payments, cross-border, small merchant acquiring/payfacs (and other edge UCs are a different story). 

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eCommerce Acquiring – Beyond Tokens – The Next Big Wave of Improvement

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Short Blog

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Adyen was the largest network “tokenizer” and realized the benefits through enhanced authorization rates and reduced fraud. As I explained in Tokens and Binding 101, this history of tokens in payments is long, with each stakeholder maintaining an ability to tokenize. While all token strategies protect data, network tokens differ in RULES, binding (to a customer and device) and acceptance. For example, Visa’s Cloud Token Framework (CTF) and Mastercard’s Digital Enablement Services (MDES) address 6 key areas:

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Wallets and Privacy

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I’m on a brief vacation celebrating my 28th anniversary and deep in thought (pic below). What am I thinking of here on the beach? Wallets, Networks, Trust and Privacy.

The Case for Separating Wallets from Identity Providers

As digital identities continue to evolve, one of the most important debates centers around who controls and operates the wallet that holds these identities. Specifically, should wallets be separated from authorities that legally issue “identity”—commonly known as Identity Providers (IdPs)? This issue is particularly relevant in countries like India and Europe, where digital identity initiatives have made significant strides, yet their approaches raise important questions about privacy and control.

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Wallets and Networks: The Backbone of Digital Transactions

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Stimulating community discussion is the #1 reason I write this blog. The intersection of payments, banking, and technology is evolving rapidly, and I’m fortunate to engage with great minds like Dave Birch and new friends like Simon Taylor. Dave’s recent post on crypto predictions got me thinking about a topic I keep coming back to—wallets and networks.

As a former banker, I’m naturally more skeptical about FinTechs disrupting the core of banking. Consumer behavior is incredibly difficult to change, and financial services are among the most competitive industries in the world. If there’s one concept where my perspective diverges from many thought leaders, it’s the power of bank networks (read more). These networks are the foundation of financial transactions, and they continue to define the way money moves.

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Winning in Network of Networks: Collaboration

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My largest holdings are card networks, and I’m very keen on their continued growth and sustainability of competitive advantage. My confidence is based on five broad themes. 

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Networks, Value Assembly and Organizational Structures

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Bull Case For Visa and Mastercard 

Very Long Blog.  4 Page Exec Summary. Feedback appreciated. This blog has been my “blocker” as I’ve iterated over the last 7 months. I’ve thinned this down from 31 pages (which no one would read) to 23. No I will never write something this big again.

The thoughts below are an update to my 2016 Small Wins, where I outlined how the forces that have driven scale, and shaped organizations, are atrophying (Transaction Cost Economics, asset intensity, information intensity, finance… etc). Paul Graham’s calls this change Refragmentation, I call it Transformation of Networks.

It’s as if the gravitational constant (the big G) is changing and new forces are driving the formation of new networks influenced by a rapidly evolving world of “weak links”. Information intensity has moved beyond “tweaking” 100 yr old business models to transform the design of industries, communities and people.

Whereas the 2016 blog was more about the “possibilities” enabled by tech, this blog is about the reality of how things will evolve.  

© Starpoint LLP, 2024. No part of this site, blog.starpointllp.com, may be reproduced or retransmitted, in whole or in part, in any manner without the permission of the copyright owner. Also see our Legal/Disclaimer (this is a highly opinionated and partially informed blog).

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