Case Study: Metered billing with limits

Crypto Billing Co. offers a product with a flat fee of $4.00 for the first 10 units of usage, and an additional $0.20 for units 11 and above. However, Crypto Billing Co. also wants to set a usage threshold for a subscription, so that an invoice is automatically generated when their customer reaches a usage threshold of $5.00.

This means that the customer can use up to 15 units (the first 10 units are $4.00, and the additional 5 units are $0.20 per unit, for a total invoice of $5.00) of usage, before that customer gets automatically invoiced, even if that customer’s billing cycle hasn’t ended yet.

Here’s an example of the customer’s upcoming subscription as they exceed the usage threshold, right before an invoice is automatically generated:

It may take a few minutes for Stripe to automatically issue an invoice, even if threshold billing is configured, so theoretically a customer could still exceed the threshold before an invoice is finalized, although this feature can significantly accelerate the billing cycle if a customer is paying monthly based on metered usage.

When the invoice is finalized, it is automatically pulled into Loop, and then it’s automatically processed / paid using the customer’s allowance (this could take a few minutes for the transactions to confirm on-chain). When the payment is processed, Loop marks the invoice as paid.

Here is an example of an invoice that has been finalized, and processed on-chain and marked as paid, based on a billing threshold being reached for Crypto Billing Co.:

That’s it! You can use this feature to effectively implement usage thresholds for subscriptions paid in crypto.