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Some things to keep in mind from the merchant perspective. A merchant will care about cost per transaction, cost of fraud/chargebacks, acceptance by customers, and integration into their backend systems. Once you have these solved, merchants will flock to you.

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I’m a merchant myself, I sell e-paper calendars. Last year I paid about 4% of my revenue for transaction costs in various shapes. That’s very roughly 20% of my margin. (!) Some of these are hidden as very bad, but non-optional, currency conversions.

The hard one here is acceptance by customers. No merchant wants to clutter their checkout page with a button that nobody understands. Or worse, have customers get trapped in a dead-end payment process.

Another way to think about this is in terms of how many marginal customers you get from being able to accept payments over the Web. 4% starts sounding less bad

You can make the same argument for, say, paying protection money to the Mafia or for paying the 30% apple tax.

Just because it’s rational to pay off a monopolistic rent seeker doesn’t mean that the rent seeker generates economic value corresponding to the monopolistic rents they’re extracting.

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