Forget cashback, get Bitcoin back
Lolli CEO Alex Adelman offers users a way to earn Bitcoin without buying it
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임준혁
임준혁 2022년 8월6일 12:00

 

비트코인 리워드 기업 롤리(Lolli) 창립자 및 최고경영자(CEO) 알렉스 아델만. 출처=롤리 제공
Alex Adelman, founder and CEO of Bitcoin rewards firm Lolli. Photo provided by Lolli.

Lolli is a Bitcoin rewards company that makes it really easy for people to get into crypto.

Lolli's is not some convoluted crypto project that takes a finance whiz and a coding nerd to decipher. Their business model is simple. Lolli partners with merchants like CVS, Safeway and Albertson's, who compensate the firm whenever Lolli users shop at their sites or stores. Lolli then compensates its users with a cashback service in the form of Bitcoin.

Users can utilize Lolli through either a Google Chrome extension or a mobile app. When a user signs up, they're automatically connected to a Bitcoin wallet. Users can then move rewards to a cold-storage wallet or to an exchange if they want to.

"Most users actually keep their Bitcoin on Lolli, because they trust us as a custodial wallet."

I met Lolli's founder and CEO Alex Adelman in Austin during Consensus 2022. I was sitting in the press room, jetlagged and jittering from coffee, when a Lolli staff member approached me and asked if I wanted to interview him. Sure. Why not? Consensus is all about the connections.

When I meet Adelman at the Austin Convention Center on a brutal summer day, he is all smiles and enthusiasm. Convention attendees swarm to and fro around us as we chat over a table planted next to a coffee booth.  

"We've partnered with over a thousand merchants, who pay us when our users shop at their sites or stores. There's no token economics scheme. It's a traditional cashback business, but instead of giving people cash, we give them Bitcoin."

 

Why Bitcoin-back and not cashback?

But why Bitcoin over cash? I prod Adelman to share his Bitcoin philosophy. He describes Bitcoin as "the best savings technology the world has ever seen." He says when Lolli launched, Bitcoin was selling at about $4,000 per pop. While other platforms offer users rewards in the form of points or cash, Lolli provides what Adelman sees as a superior reward.

Adelman first got into Bitcoin in 2013. He was crashing on couches in New York, and bumped into a guy who was obsessed with Bitcoin. The encounter turned into an all-night drinking session and conversation about Bitcoin.

"I'd always felt connected to people through the internet, but disconnected through money. For me, Bitcoin made 100% sense."

However, Adelman found that sharing his enthusiasm for Bitcoin by trying to educate his friends and family wasn't easy. It was rare to find people who were as excited about it as he was.

"It was just too hard for people to get into."

At the time, Adelman was building an e-commerce gateway called Cosmic, which enabled users to buy products from multiple retailers in one transaction. (Cosmic was later acquired by PopSugar in 2015 and then by Rakuten in 2017.) He tried onboarding Cosmic's merchant partners to Bitcoin, but most of them refused. They didn't have remittance networks set up, and their customers didn't want to pay with Bitcoin.  

"I realized then that Bitcoin wasn't going to be mass-adopted as a payments technology. It was going to serve as a longterm store of value."

Adelman took the time to study the cashback and rewards ecosystem, and concluded it would serve as an excellent way to distribute Bitcoin.

Screenshot of Lolli's website
Screenshot of Lolli's website

 

Bitcoin = superior savings technology?

I mention Bitcoin's volatility as a potential drawback of receiving a Bitcoin reward instead of a cash reward. Adelman says volatility can actually serve as a positive.

He explains that volatility actually attracts people to check in every day. On a traditional cashback app, if you earn five dollars. You don't check back in, because that five dollars is five dollars. With Bitcoin, however, they check in more often, which means they see more retailers and end up earning more Bitcoin.

"The great thing with Lolli is that you're not buying. You're earning through shopping that you'd do anyway."

Adelman also thinks that the deflationary nature of Bitcoin -- its maximum supply being set by its programming at 21 million -- means today's earnings and savings will have more buying power in the future.

I ask about Adelman's plan for more adoption. His answer is simple: more merchants. Lolli has recently secured a partnership with Shake Shack. Right now, Lolli is a US-only service, but Adelman says the goal is to go international. I ask where Lolli wants to go. Once again, the answer is beautifully simple: Where there's the most demand.

In response to my inquiry about regulatory challenges, Adelman says that since Lolli users don't buy Bitcoin from Lolli, the company is not considered a money transmitter.

 

Bitcoin optimist

I ask if Adelman considers himself a Bitcoin maximalist. He answers that he's a "Bitcoin optimist."

"I'm really curious about other cryptocurrencies, but I think Bitcoin has repeatedly proven its value to society. Whereas I think Ethereum still has a lot to prove. Solana has even more to prove." (laughs)

Adelman points out that Bitcoin's volatility index has diminished drastically over time. It's now less volatile than many national currencies.

"For people in emerging markets with volatile national currencies who don't have access to the US dollar or gold, Bitcoin is their best currency."

Adelman thinks Bitcoin is one of the few things someone can truly own. Whether it be the house you buy or the money in your bank, you don't truly "own" it because you don't have total sovereignty over it.

"Very few things that you can truly own retain their value. Most physical items you can own decpreciate in value. Gold retain its value, but it's difficult to transfer and store. Try to have all your assets in gold. You need your own Fort Knox to protect it."

Adelman views Bitcoin as a better, more decentralized, version of gold.

 

What's wrong with crypto?

I ask for any critical perspectives regarding crypto. Adelman says too many projects don't think about the end consumer or user and how their projects could hurt those consumers. He points to the Terra/LUNA fiasco as an example.

"A lot of things look like Bitcoin on the surface and are marketed to be the next Bitcoin, but they fall short. And every time those projects fall short, they hurt people and their lives."

So, whose responsibility is to weed out those bad projects? Regulators? Or should we just let the market sort things out?

Adelman doesn't think regulators are the answer. While they may have good intentions, he thinks they often stifle innovation. Adelman thinks we'll eventually see more third-party researchers that will serve the role of watchdog and verifier, providing resources for the individual investor to determine the risks behind a particular project.  

"Unfortunately, it looks like we're approaching a global recession. I think people will be looking to save money in more places, so the timing for a tool like Lolli to exist couldn't be better."

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