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Blockchain Financial Services

What you need to know about ERC token standards

Making sense of the ERC token types and what they do can be a bit confusing. Different token standards enable different features. From representing ownership of an asset to making trading easier, tokens are an integral part of any decentralized application. The utility of the Ethereum protocol is that it allows developers to build dApps on top of the underlying blockchain.

Unlike Bitcoin, which primarily functions as a payment system On the other hand, Ethereum opens up other use cases for blockchain technology. Business cases so far have tended to focus on intangibles such as cryptocurrency, transferring medical records or tokenizing digital assets. However, tokens can also stand in for of physical assets, such as real estate and luxury goods, or power supply chain tracking platforms. Each type of digital token serves a slightly different function and understanding the difference between ERC token standards can help you decide which one is best for your blockchain project.

Tokenizing assets is one of the main value propositions of the Ethereum blockchain. Smart contracts need cryptographic tokens to function. Gas — paid in the form of ETH tokens fuels the transactions on the Ethereum network. While the two most common types are the ERC-20 and ERC-721, others are emerging with new features and improvements. In this post, I’ll look at the main types and examine the use cases as well as the pros and cons of each.

ERC-20

Among the most common and functional ERC token types is the ERC-20. These were very popular in ICO projects because they made it easier to create and distribute tokens directly to user wallets. Additionally, end-users can freely trade and use them within token economies.  Simple functions allow developers to limit the total supply — a key consideration in a tokenomics model and allow users to transfer tokens easily. Smart contracts verify user funds and approve the transactions before finally writing the transaction to the blockchain. Inside the system, the tokens are of equal value and users can exchange them freely for other tokens.

These fungible digital tokens enable platforms to issue tokens users need to access a service. Like a kilo of wheat or a barrel of oil, fungible tokens are worth the same as other tokens in the ecosystem. This equal value encourages token users to earn and spend freely. One example Espeo helped develop is the derivatives trading app CloseCross (pictured above) which issues tokens that allow users to place bets on derivatives contracts.

For a case study of the CloseCross project, read more here.

Users pay in a number of tokens to place a bet and receive tokens back when they win. This, of course, provides an incentive for end-users but also helps power the system as a whole. Because it’s a trading ecosystem, we decided to implement ERC-20 tokens in the tokenomics model. CloseCross wants users to win and spend their tokens to access a service and sustain the dApp, not hoard them away.

ERC-20 Pros:

  • Widely used token standard and supported by a majority of exchange and wallets
  • Supported by most exchanges and wallets
  • Good for trading applications where fungibility is important

ERC-20 Cons:

  • High gas costs
  • UX has led some to send coins to smart contracts instead of crypto wallets.
ERC token standards

ERC-721

One of the other common ERC token standards is the ERC-721. Unlike the ERC-20, ERC-721 tokens are non-fungible. In other words, each token has a different value in the system. While ERC-20 tokens are the same value and act as currency on the platform, ERC-721 tokens are not. The point of these is to create unique, rare or editioned assets. ERC-721 tokens allow developers to tokenize assets of different values. The most famous example is the Ethereum dApp CryptoKitties.

Each cryptographic piece of digital art had unique features which gave them value. Some features are more desirable than others. While CryptoKitties got its fair share of ridicule, it demonstrates some of the usefulness of blockchain and of asset tokenization. Digital artists, for example, can use ERC-721 tokens to protect their original work from unauthorized copies.  

With ERC-721 tokens artists are able to tokenize digital work — creating cryptographic scarcity and protecting its value. Several startups such as Maecenas and Artory are already tokenizing physical art to ease provenance studies and facilitate sales. Outside of the art world, other firms such as Streetwire are tokenizing real estate for similar benefits. Essentially, ERC-721 tokens facilitate the transfer of unique assets. Development in

ERC-721 Pros:

In one of our product design workshops for our client Luxtrack, we developed a tokenomics model incorporating the ERC-721 token on their anti-counterfeit luxury goods platform. The token allows users to seamlessly buy and sell second-hand luxury items and be confident that the items are not knock-offs. Luxtrack tokens provide a scalable way for the company to build trust and expand a market rife with abuse. ERC-721 tokens enable the company to reassure consumers that the products they buy are authentic.

  • Allow artist to edition their work
  • Non-fungible tokens enable platforms that rely on scarcity and value to trade
  • Represent ownership of investments rather than functional tokens

ERC 721 Cons:

  • Slow adoption
  • Tricky to get UI/UX right

ERC-223

While this one is not a fully supported digital token, this token type addresses several of the UX shortcomings of other ERC token standards. Many people have sent coins to the wrong wallet address or worse, to a smart contract, losing those coins forever. Though many crusty developers might say it’s end-users’ fault for sending tokens to the wrong address, it could limit broad adoption among the general public. These unfriendly design features might turn non-technical people away.   

In short, the proposed ERC-223 alerts users who accidentally send tokens to a smart contract address and cancels the transaction. Users still pay the gas cost but save their ETH. Amigocoin is one of the only projects currently using the ERC-223

ERC-223 Pros:

  • Proposes friendly UX features that protect users from loss of funds
  • Backward compatible with ERC-20 token standard
  • Half the gas cost of ERC-20 tokens

ERC-223 Cons:

  • Not widely accepted by the Ethereum community
  •  Incompatible with many wallets

ERC-777

Just as the ERC-227 offers bug fixes for the ERC-20 token standard, the ERC-777 digital token proposes still more ways to improve blockchain usability. This digital token adds several more functions to the popular ERC-20 token standard. One of the most innovative is the option to mint or burn tokens, which may be a necessary feature depending on a project’s tokenomics model.  Of all the ERC token types, this one may also make the transfer of tokens much simpler.

Of course, as with the other more obscure ERC token standards, few projects have actually decided to implement the protocol. However, Ethereum applications could benefit from better design and more user-friendly options.

ERC-777 Pros:

  • Proposes improved usability

ERC-777 Cons:

  • Not widely accepted

Conclusion

As more and more ERC token standards emerge, each one will roll out new features and bug fixes for the existing tokens. Choosing which digital token to use in your blockchain project is essential to ensure your platform delivers the most value to end-users. Whether you’re launching an STO or tokenizing medical records, getting the tokenomics right is a vital step to launch a successful product.

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Blockchain Software Technology

Ways blockchain gaming is driving demand for digital assets

What better way to motivate people to adopt a technology than by making it fun? Blockchain gaming is a compelling use case for distributed ledger technology. As the gaming and esports industry continues to grow, there are big opportunities to encourage more people to buy in-game items and build peer-to-peer marketplaces around them.

In many online games, gaming companies store in-game purchases on centralized servers. This leads gamers to question who really owns these assets. Gamers don’t fully own the virtual assets they purchased and they can’t sell or trade assets outside of the game. Using the blockchain to store items and characters enables decentralized and transparent asset ownership and will allow gamers to exchange them p2p, or exchange them for assets on other games.

Blockchain technology is changing different industries and the $100 billion gaming industry is no exception. Blockchain is here to change many aspects of video games that billions of people around the world are playing.

Virtual asset market

One of the benefits of blockchain technology in gaming is that it will increase the value of these virtual assets. By making digital in-game purchases rare and unique with cryptography, the community of gamers will create a virtual asset market. Some of the ways DLT will do this is by:

  • Providing gamers a way to use virtual items in and out of games will increase their value.
  • Creating platforms that will allow a gamer to sell the items for fiat will also increase their economic value.
  • Building a healthy marketplace for items will increase their social value.

All of this will change the name of those items from virtual items to digital assets.

Security increase

In traditional games, virtual items ownership and trading was not possible. Gamers used to work hard or pay to get rare and expensive items that counterfeiters copy later, leading those assets to drop in value. Blockchain will address that problem since it can stop the trade in counterfeit virtual assets on the black market.

It will also stop the illegal acquisition of keys by creating a decentralized and immutable ledger where users can store items and determine what belongs to whom. This will make duplicating the items impossible. It is the same principle of cryptocurrencies where the main purpose of the blockchain is to prove immutable ownership.

Faster Payments

Blockchain will make the purchasing of items and games faster and will ensure the payments are secure. Developers face many issues selling their software outside of app stores, which leads to huge commission fees and loss of control over the customers. Additionally, blockchains enable micropayments which allow developers to receive direct payment and enable them to make a larger profit margin.

ESport use cases

Electronic sports are gaining in popularity recently. Virtual tournaments centered on video games are no more just for fun and it is becoming a lot more serious sport with a huge number of spectators.

With the rise of eSports, interest to apply the powerful blockchain technology to it increased as well. Electronic sports will grow into a $1 billion industry in 2019 and will likely exceed major league baseball by number of viewers by 2020.

With this increasing popularity, new gaming celebrities are emerging and are contributing to the growth of this industry through their videos and streaming channels.

One of the best-known gamers is Tyler Blevins, more known by his online name Ninja. He is a Youtuber and Twitch streamer. As of May 2019, he is the most followed streamer on Twitch with more than 14 million followers and an average of 40,000 viewers per week. So just like in traditional sports, fans follow their favorite eSports personalities.

However, despite the growth and popularity of eSports, it is still facing some challenges especially when it comes to the establishment of eSports teams. Even though there is a big number of professional gamers, finding and tracking these gamers ranking and progress remains difficult.

To make a comparison, there are around 100 professional teams for the most popular eSport game in the world, League of Legends, while there are about 300 thousand football teams worldwide. The main reason for this small number is that it is not possible to track and contact good eSports players.

So establishing contracts, coaches, managers for eSports teams and gamers is a hard, time-consuming, and expensive process.

For the eSports industry to expect to reach its potential and grow to come close to sports like soccer, it needs to apply new technologies that have the potential to accelerate its growth and this is where the blockchain technology can come in.

Companies making a difference

One company that offers a flexible, free platform for creating, integrating, and scaling blockchain-based gaming assets is Enjin Coin.  It announced via its Medium page in March 2019 that it is going to launch a Testnet version of the Unity SDK. The SDK will allow users to integrate a robust suite of blockchain-based ERC-1155 assets into their games.

D Another company solving the problem of financial transparency in eSports is DreamTeam. They are providing an all-in-one platform that will allow gamers to find teammates, manage teams and earn money from competitions. The platform was launched in 2017 and since then it has acquired 1.3 million individual users. It connects gamers, sponsors and professional competition and is offering gamers the opportunity to apply to professional, semi-professional or amateur eSports teams with a more than 60% chance to get lucrative deals, receive prize money and set their salary.

Tron is also one of the most advanced blockchain projects. Tron is the standard for blockchain-based video games. Due to its potential for high scalability, it is becoming the go-to project for blockchain game developers.

blockchain gaming
CryptoKitty

Blockchain games

Starting with some history. Blockchain gaming started around 2013 with games such as HunterCoin but we had to wait until late 2017 for the general public to start paying more attention to blockchain gaming after the launch of Axiom Zen’s CryptoKitties.

CryptoKitties allows you to collect, breed and trade virtual cats on a market place. One Kitty sold for more than $170,000. As the game gained in popularity, it reached an all-time high in the number of transactions on the Ethereum network and famously crashed the network in December 2017.

The game operates as a non-fungible token (NFT) on the Ethereum network which is unique to each CryptoKitty. So each CryptoKitty is unique and owned by the user and its value can increase or decrease depending on the marketplace.

In October 2018, the game reached 1 million cats being bred with a volume of 3.2 million transactions on its smart contracts. It has processed more than $12 million in sales on its marketplace. There are other games as well that are gaining in popularity such as World of Ether on Ethereum, EOS Knights on EOS, Epic Dragons on Tron and many others.

Blockchain gaming gameplay

Most computer gamers find that the gameplay is still limited but the games are evolving and many game developers started giving more attention to blockchain games. Like Ubisoft that is planning to launch a blockchain based game called HashCraft. It is still in very early development, prototype form. The game is an experiment in what the future of gaming could be and it is inspired by famous games such as Minecraft and Fortnite.

The team behind it is led by Ubisoft’s Blockchain Initiative Manager Nicolas Pouard who is also a founding member of the Blockchain Game Alliance. The team spent the last year building the prototype and demonstrating it and Pouard says he had been shocked by how the public reacted to it with many gamers and journalists asking about when the game will launch. While the game itself is not quite ready for full release, it is pushing the boundaries of what was previously thought possible.

Conclusion

Blockchain technology has risen in popularity in recent years especially after bitcoin reached its high peak of $19,783 in December 2017 but it’s still far from mass adoption. Many believed that financial applications would lead to mass adoption. However, blockchain gaming may be the catalyst instead. The gaming industry and eSports are constantly growing in popularity and it has a proven history of being the catalyst for the adoption of new technologies such as artificial intelligence, virtual reality, and augmented reality. Blockchain technology is similarly likely to resonate with end-users through the value it brings to gaming communities. As more people enter and engage with others through online gaming communities, blockchain technology offers a way to tap into a billion-dollar market.

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Finance Financial Services

Recurring payments and how to use them

Recurring payments and how to use them

Recurring payments have worked their way into thousands of popular subscription services. While subscription models are nothing new, e-commerce has driven innovation in new directions. Integrating online payments in customer-friendly ways is now a top priority for many firms looking to improve cash flow. Video and music streaming giants popularized the trend and now other companies taking these lessons to sell goods or services. Just how seamless a payment provider integration is often means the difference between happy customers and cancelations. Here’s a brief overview of recurring payments and ways put it to good use.

Recurring payments and how to use them

Table of contents:

 

What are Recurring payments?

Recurring payment subscription is a business model in which cardholders pay automatically at regular intervals for a product or service. According to Mercator Advisory Group, e-commerce, bill paying, as well as subscription models are factors underlying rapid payments development. In this model, customers allow retailers to save their payment details and give their permission to automatically withdraw funds from a bank account or credit card. This can improve the checkout experience, which can vastly improve customer retention and win loyal customers.

A 2018 report from the consulting firm McKinsey found that the subscription market grew 100% per year for the previous five years. Nearly half of all subscriptions are video or music streaming services. Among the most famous examples of companies that use recurring payments model to improve cash flow is Amazon, whose revenue rose from $7 billion to $10 billion in recurring billing after launching its service Amazon Prime. Other examples of such global players are streaming services Netflix and Spotify. In the second quarter of 2019, Netflix reached a record-breaking 150 million paid subscribers. Spotify meanwhile, has 108 million.

a graph about the percent of subscribers among online shoppers
 

Subscription models

Currently, you can split recurring payment models into three types. Curated choice takes user interests to pitch personalized content while replenishment fills routine items at specific intervals. VIP club recurring billing models create an air of exclusivity that can make your business stand out.

  • Curation — This is the most popular according to the McKinsey survey. What attracts customers in this category are the positive emotions linked to receiving personalized, hard-to-find items. Try the World does this particularly well. Subscribers save their credit card details once and receive snacks from around the world every month.
  • Replenishment — This model saves users’ payment information and helps optimize shopping for routine items such as razors or toothbrushes. Dollar Shave Club or The Bam and Boo allow you to customize your recurring billing frequency based on how often they ship.
  • VIP club — Members can access premium products, discounts, or free delivery otherwise not available to regular customers. Amazon’s Subscribe & Save offers attractive discounts to members and is among the most popular recurring billing model.
 

Managing recurring subscription billing and existing systems

In many services, customers can adjust their recurring payments schedule according to their needs. When a customer pays a set amount of money for the product or service, this is a fixed subscription. This payment schedule is widely used by different kinds of streaming services when a fixed membership fee is charged from the customer’s bank account regularly. There is also a variable amount model in which the price that the customer pays is not stable. You can see this schedule applied when your account is charged for utility bills which differ from month to month.

 

Benefits and challenges

Among the most obvious challenges to recurring billing is the convenience and comfort for both customers and merchants. Customers using this method often stay longer than traditional one-off transactions. This gives the company a much better idea of revenue and makes supply ordering much easier. In this way, the company can gain more recurring customers. recurring billing can also lower the costs, helping to receive payments without delays and reminders.

For consumers, this payment method allows them to save time on entering credit card data each time at checkout. Subscription models can also reduce the anxiety and indecision that some consumers feel as they try to make a perfect purchase. Moreover, subscription packages can cause more positive emotions in comparison to traditional shopping because of the less effort and time spent on choosing the right product and element of surprise.

Besides some obvious advantages, some caution should be exercised with a recurring payments plan. First of all, it is more difficult and time-consuming to troubleshoot some potential issues or errors. For companies, there are still some administrative costs left. Moreover, according to the McKinsey report, churn rates of such businesses as subscription boxes are quite high and companies should have a unique competitive advantage to attract buyers.

graphic with 5 advantages of reccuring payments for business
 

Recurring payments perspectives

Recurring payment methods besides some resistance is becoming widely accepted and used. According to the Gocardless survey, which surveyed 4,000 people, 52% of respondents preferred direct debit. In the UK and Germany, the number of respondents enthusiastic about direct debit was even higher reaching more than 60%.

Another recent survey conducted on almost 12,800 participants from different countries showed that Canada is the leading nation willing to make automatic payments with credit cards. 27% of the respondents declared that they are likely to use it to pay for offline subscriptions whereas 26% for bills and subscriptions online. The survey found similar results for American consumers. In the US alone the recurring billing method is expected to increase to $473 billion by 2021.

 

Blockchain recurring payments

First services offering recurring payments using cryptocurrency were Coinbase and PumaPay. In August 2019 Monarch announced its decentralized blockchain-based recurring payment system. The advantage of this subscription business model includes capturing a growing market of people who want to see alternatives to centralized systems. Recurring billing smart contracts is what allows users to hold their own private keys and seed phrase.

Decentralized web browser Brave flips recurring billing on its head by paying users in their native BAT, or basic attention token cryptocurrency to look at advertisements on the platform. While it remains an open question about the viability of this business, cryptocurrency transactions do lend themselves well to small, payments. Brave does offer an example of how similar systems could work. It’s conceivable that a streaming service or online publication could charge a small fee per minute or per view directly from users instead of running ads.

Smart contracts can verifiably prove that a user viewed something and release payment automatically, greatly streamlining billing and auditing. Of course, instead of credit cards and bank accounts, users would connect their crypto wallets. So if you want to accept crypto you would need to be able to integrate with a range of user wallets.

 

Final thoughts on recurring payments

The question arises whether this system will be the future of recurring billing. What we know for sure is that it opens wide perspectives for businesses with its improved security and possibilities to create personalized subscription plans. In addition, recurring payments can streamline a checkout process by saving key payment details. Credit card, debit card and maybe crypto wallet integrations will be ever more vital as more consumers and retailers transition to e-commerce.

Adding a recurring payment system can grow your business and win loyal customers. Want to add it to your business? Schedule a free 15-minute consultation with one of our payment experts to find out more.

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Blockchain Healthcare Public

Lessons to learn from the UAE in blockchain healthcare

In 2018, the United Arab Emirates set out on an ambitious plan to use blockchain technology to improve the lives of its citizens. The initiative set the country on a path to become a fully functional blockchain-based government by 2021. Sectors such as banking, transportation, and healthcare in the UAE will use blockchain technology to be more efficient and responsive. While the country as a whole has made strides, Dubai is farther along than other Emirates, especially in the healthcare sector. Here are some of the ways the Emirate is positioning itself as the first blockchain-powered city.

Blockchain EHR

In January 2017, Dubai healthcare giant NMC partnered with the Emirates Integrated Telecommunications Company, or du to enhance electronic health records (EHR) with blockchain technology. EHR has already been in use since 2008 but it involves a painstaking process that often leads to errors. With the Dubai Blockchain Strategy, healthcare companies are using blockchain technology to improve EHR. In 2018, NMC started using blockchain-enhanced EHR. Du along with NMC and a blockchain technology firm, GuardTime, came together to implement it. GuardTime is an Estonian startup that helped Estonia implement blockchain solutions. Du explained at the Keynote Blockchain Technology Conference held in Dubai how the Dubai Future Foundation and the Global Blockchain Council made the EHR improvement possible.

Most importantly, blockchain technology helps guarantee EHR security. It’s also easier for clinics and hospitals to access patients records across the UAE. Patients from Dubai could visit a hospital in  Abu Dhabi and their records go with them. Patient data is easily accessible and once a doctor provides a treatment, the data automatically stores in real-time. This innovation will make a lot of difference in an emergency. It will optimize emergency healthcare since doctors and nurses can verify a patient’s medical records within seconds, thereby saving lives.

Strides in UAE blockchain healthcare

During GITEX Technology Week in 2018, the Dubai Healthcare City Authority and Dubai Health Authority (DHA) agreed to link healthcare professionals’ licensing data with a blockchain system. Using blockchain technology, both government bodies will link the Masaar e-services portal and Sheryan smart licensing system for licensed healthcare professionals from anywhere in the world.

This innovation is especially favorable for healthcare innovators and professionals who are looking to invest in the rapidly growing city. Linking the DHA smart licensing system and Dubai Healthcare City Authority portal will allow potential healthcare providers to apply to obtain a license from anywhere in the world. Given the list of over 100 licenses available on Masaar e-services, potential healthcare professionals and investors will have a wide range to choose from. Blockchain technology will make finding out license requirements, procedures, obtainment, and renewal for professionals who intend to practice in Dubai seamless. This also applies to healthcare innovators and companies seeking to invest in Dubai.

Du, Dhonor HealthTech partner up

During the Unlock Blockchain conference in Dubai in January this year, UAE’s du announced its blockchain platform as a service (BPaaS) latest innovation. Du, in conjunction with Dhonor HealthTech, a global healthcare blockchain solutions company, will provide the United Arab Emirates’ first patients blockchain-powered safety solution. The blockchain solution will make it easier for patients and healthcare providers to verify the authenticity as well as the condition of medicines. Basically, making it possible to verify the source of medicines and what they contain, therefore, protecting the lives of patients who depend on them.

blockchain healthcare

Organ donation and Dhonor HealthTech

In February 2019, the UAE’s Ministry of Health and Prevention (MoHAP) announced a blockchain-enabled mobile app, Hayat, to improve the process of organ donation in the UAE. One of the initiative’s major sponsor is Pfizer. MoHAP partnered with Dhonor HealthTech to help with creating the blockchain organ donor program. With the help of Dhonor HealthTech, MoHAP has registered UAE citizens (patients) on the blockchain healthcare platform. Dhonor HealthTech and MoHAP will link the blockchain organ donation program across all the seven hospitals that carry out organ transplant operations in the United Arab Emirates. The Hayat organ donation blockchain solutions, enhanced with AI, correctly record patient DNA, verify organs, and optimize organ transplants in the UAE.

With this initiative, UAE hospitals will be able to check whether the DNA of a donor matches the donated organ. The Hayat initiative will also improve the process of checking whether a donor matches the patient’s DNA. All this will mean less paperwork. The Hayat app collects and stores DNA data from swabs and is easily accessible.

This initiative will not only improve the UAE’s healthcare sector by optimizing organ transplant procedures but also reduce organ trafficking. This will be possible because they’ve already collected DNA swabs from UAE citizens and saved them. Everyone in the UAE will have a unique ID, therefore, once someone goes to one of the seven hospitals that perform organ transplants in the UAE, the hospital can verify if the donor’s and the organ’s DNA match. As a result, they will be able to cut down on organ trafficking. It will also make it easier for transferred patients to continue their organ transplant treatment. This is because healthcare providers in organ transplant hospitals can easily verify and match organs on the blockchain-powered Hayat app.

blockchain healthcare

Future Of blockchain healthcare in the UAE

When Dubai and the UAE at large set blockchain implementation goals for 2020 and 2021, it probably seemed like too short a time to achieve the goals. However, the future of the UAE’s healthcare is bright because they have clearly made some impressive achievements and the world should take notice. They have successfully become the second country in the world working towards becoming a blockchain-powered country. Estonia being the first. Besides having a concerned government which cares for its people’s welfare, the UAE has a young population that is always eager to try new technologies. Hence, achieving a fully backed blockchain country by 2021 – 2023 is highly likely.

By paying attention to the progress made in Emirati healthcare and how they have implemented blockchain, different countries can learn more about real-world applications of blockchain. We have learned that blockchain can store patients medical records, authenticate medicines, and facilitate organ donation. Therefore, it should no longer be hard to see blockchain beyond cryptocurrencies, the blockchain technology can revolutionize and improve any sector in a country.

Conclusion

The UAE is showing the rest of the world how to implement blockchain in healthcare, there are always annual symposia and conferences focusing on blockchain and healthcare stakeholders from different countries. The UAE is ever welcoming for investors whether small or big, it welcomed VeChain, GuardTime, as well as Pfizer for blockchain partnerships. As a result, one thing is certain about the UAE, it’s creating a better healthcare environment for its citizens.