🔁 Repeat payments, streaming IbAlluo
💡 This page talks about our streaming interest bearing tokens and how organisations can save $money every month through using them
The traditional banking world is geared around daily, weekly, monthly and annual timeframes. Banks are open during business hours across the workweek. Salaries are often paid weekly or monthly and many transfer money to relatives or pay for services on a monthly or annual basis.
In turn, many people set up a form of recurring transaction (e.g. a standing order) to cover these repeated payments.
In the web3 world, it is possible to do more to control your payments and various companies have created streamable protocols.
Streams can be used to describe cash flows and execute them automatically on-chain over time with just a single transaction. So for example, you can create a stream in one transaction that will send someone $1000 over the next 100 days and it will stream it to them by the second at the rate of $10 per day.
Alluo has partnered with Superfluid (a leading asset streaming protocol that enables Web3 native subscriptions, salaries and rewards for DAOs and crypto-native businesses) to create streamable yield bearing Alluo tokens .
With Yield-Bearing Streams, this means that as funds are being streamed from wallet A to wallet B, they continue to compound at a given APY and remain invested during the entire streaming process until the moment the user wants to convert some or all of the stream back to a stablecoin.
Because the stream is interest-bearing, the sender of the stream can reduce the amount of money they need to send to the recipient. Yet, the stream recipient will still receive the full amount owed.
For example, if a DAO wants to pay a contributor $5,000 a month, today they only need to deposit $4,971.89 into Alluo each month. They can then stream this IBAlluoUSD to their contributor and their $4,971.89 will continuously compound at 7% throughout the month. At the end of the month their contributor can withdraw $5,000 USDC.
That means the DAO can save approximately $28 each month for each contributor, simply by benefitting from the future yield that will be generated by the protocol.
For more technical information, please follow the links below:
We'll soon be launching streaming directly from the Alluo mobile app and a very exciting AutoInvest where you can use streaming to dollar cost average buy interest-bearing ETH and BTC 👀. So watch this space!