Pay Protocol

PayProtocol is a cryptocurrency payment platform that connects digital-asset payments with online and in-person commerce. Its payment services use Paycoin (PCI), a utility token first developed by South Korean payment provider Danal, and include an app and a Mastercard-based service for spending PCI at merchants. The project has described its broader goal as linking real-world payments with decentralized finance (DeFi).^[1]​^[2]​^[3]​

Overview

Paycoin began as an in-house initiative at Danal, which drew on its payment infrastructure and experience to explore blockchain-based payments. PayProtocol AG was established as a separate legal entity in Switzerland in September 2018 to advance the project. Danal had developed mobile-payment and integrated-payment services, and the project’s account describes the company as supplying integrated payment solutions in 12 countries.^[2]​

PayProtocol AG launched PCI on a private blockchain based on Hyperledger Fabric. The Paycoin app was commercially released in April 2019, allowing users in South Korea to make real-world payments with the token.^[2]​

In a February 2024 white paper, PayProtocol presented its platform as a response to the complexity and cost of conventional payment processing. The paper described traditional card payments as involving multiple intermediaries, processing steps and fees, with settlement that could take up to 30 days and, in some cases, as long as 90 days. It also identified three challenges for wider use of digital-asset payments: handling differences among regions and networks, avoiding exposure to asset-price volatility, and making the system accessible to merchants with limited technical resources.^[4]​

Design and Payment Services

Paycoin’s underlying network is a permissioned Hyperledger Fabric blockchain: only authorized nodes validate transactions. The project presents this design as suited to retail and e-commerce payments, citing transaction speed, privacy, and enterprise-oriented security and compliance as intended benefits.^[2]​

PayProtocol’s Wallet Pay service is designed to let customers spend digital assets in everyday online and offline transactions. Users can pay through the PayProtocol App at Mastercard-accepting merchants, while the company says its payment-gateway partnerships support payments across global markets. PayProtocol describes the service as offering merchants lower fees than traditional credit cards and says users may receive benefits based on their payment history, including opportunities to earn digital assets.^[1] In Europe, Paycoin launched the card with Swiss Web3 neobank SR Saphirstein AG, also known as Fiat24. The card can be registered with Apple Pay and Google Pay, and the service supports online shopping, overseas purchases, travel and subscriptions. Its financial-network integrations include SWIFT, SEPA and IBAN for cross-border value transfers.^[2]​

Ecosystem

PayProtocol’s white-paper materials describe PayChain and the Pay-To-Finance Protocol (P2F) as central to its approach to connecting digital-asset payments with real-world applications. The project presents the materials as covering payment infrastructure, interoperability, compliance and technical payment models intended to establish Web3 payment standards.^[5]​

In August and September, PayProtocol published a two-part PayChain series about payment infrastructure. The first installment discussed fast blockchain payments alongside slower settlement; the second addressed infrastructure for events after an on-chain payment, including verifiable proof.^[3]​

PayProtocol has also described plans to expand beyond payments into DeFi-linked financial products, rewards, vouchers and credit services. Separately, on June 22, the project reported that Danal Fintech had completed its first and second proofs of concept with BNK Busan Bank for a South Korean won stablecoin; the first examined whether a won stablecoin could function as a payment method.^[2]​^[3]​

Tokenomics

Pay Protocol's native token, Paycoin ($PCI), is used for payments, transaction settlement, staking, and governance within its ecosystem. The protocol's updated tokenomics framework introduces a fee-burning mechanism under which 50% of payment and transfer fees on PayChain are burned, aiming to reduce the circulating supply as network usage increases. Protocol fees and operational returns may also support token buybacks and reward distribution.

The token has a maximum supply of 1.9 billion $PCI, following the burning of approximately 2.041 billion tokens from its original supply of about 3.941 billion. The remaining supply is allocated across categories including marketing, ecosystem incentives, liquidity provision, team compensation, and reserves, with foundation-held tokens subject to scheduled unlocking. ^[2]