Substack Should Integrate Native Payments

Featuring 0xDesigner Design Everydays S2 109

According to my Screen Time, Substack has quickly become one of my favorite and most used apps on my phone. This is largely due to their new chat room feature, where Substack writers can create gated group chats for their subscribers. I love hanging out in the chat rooms of a select few newsletters, primarily around women’s fashion and lifestyle. I find I have a lot in common with the other readers and our conversations go far beyond the contents of the blog itself.

One interesting phenomenon I’ve noticed in these chat rooms is that women have started selling their clothes directly within the chat, as opposed to using native social commerce marketplace apps like Poshmark and Depop. Because these newsletters (read: niche communities) are so good at cultivating trust, purchase conversion and propensity to spend is much higher. I’ve experienced this firsthand: an old dress of mine that would have taken me days or weeks to sell on Poshmark or Depop ended up selling within minutes to a fellow subscriber. She was able to direct message me through the Substack app and we exchanged payment details from there.

To me, the business use case for integrating native payments is obvious, and stablecoins seem to be the best way to go about doing it. Instead of collecting every writer’s (and reader’s!) bank details via Stripe, Substack could automatically create a wallet for them upon account creation (companies like Capsule and Privy make this easy). If somebody decided they wanted to make a purchase through Substack chats, they could load their wallet via debit card (or deposit directly from their bank account) and, with the help of something like Bridge, send USDC to an escrow contract, which would hold the payment until FedEx or USPS could confirm the shipment was on its way. The payment would then be released to the seller, who could either hold the balance in her wallet or offramp it for cash.

Where this gets interesting is the incentives and royalties for the most important party in the transaction: the moderator of the chat. I can imagine this playing out where every time a sale is made, the chat owner is programmatically paid out a small royalty for facilitating the sale. Additionally, Substack could command a small fee for making this process easier and safer for its users. With stablecoin payments integrated into the product experience, the existing consumer behavior of buying and selling clothing becomes faster, cheaper, and more global for Substack users — and it provides an entirely new line of business for Substack itself. I can see this playing out across all niche communities on the web. This would be an exciting and compelling first step.

My friend 0xDesigner made a very cool visualization of this idea as part of his Design Everydays series, which you can view and mint here.

---

The materials presented on Gaby Goldberg's newsletter are my opinions only and are provided for informational purposes and should not be construed as investment advice. It is not a recommendation of, or an offer to sell or solicitation of an offer to buy, any particular security, strategy, or investment product. Any analysis or discussion of investments, sectors or the market generally are based on current information, including from public sources, that I consider reliable, but I do not represent that any research or the information provided is accurate or complete, and it should not be relied on as such. My views and opinions expressed in any website content are current at the time of publication and are subject to change.