Affirm CEO Max Levchin on the 2.5 second limit that has shaped card payments for 60 years, and how Apple and Google Pay worked around it: "One of the things that's really amazing and subtle about Apple Pay and Google Pay and its interaction with the Visa and Mastercard networks is... Visa and Mastercard have a hard 2.5 second limit on interaction between the network, the issuing bank, and the merchant and the acquiring bank." "And so the whole thing has to happen in 2.5 seconds, or the transaction gets retried or maybe just cancelled out, and really leaves very little room for any kind of clever innovation." "Online you can play games. If you're doing e-commerce, you're like, well yes, we're gonna submit your card to Visa, but first we're gonna run some anti-fraud checks, and we're gonna do some other things to reduce liability. But offline, once your card is presented, 2.5 seconds, that's all you got." "Google and Apple Pay have singularly time-shifted the whole thing by creating secure enclaves inside their chips and saying, 'I already know your card, I can do all kinds of things before I actually have to talk to Visa and Mastercard.'" "And maybe the shocking thing is that Visa and Mastercard have not yet introduced some new standard saying, actually, it doesn't have to be 2.5 seconds at all. It could be 15 seconds while we go and get a bunch of issuers to bid on better credit quality terms for you, or any other type of innovation." "But the sort of hard written rules of the Dee Hock era are more or less intact, and that's not 30 years, that's like more, you know, 60 years. And so I think that's probably a critical or more criticizing take on what happened." @mlevchin(a16z)