Category Archives: Blockchain

10 Cryptocurrency based Loyalty Points projects

Cryptocurrency and blockchain technologies have provided a fresh perspective towards solving business problems and have attracted huge interest from professionals from a wide variety of fields. These technologies have become immensely popular due to their open source nature (many popular blockchains are open source), minimal infrastructure costs and reputation for being secure and immutable. One such potential application of blockchain technology is in the field of consumer loyalty programs.

Traditionally, loyalty programs have been expensive to run with businesses needing to make significant investments in technology and/or expensive third party services. Such programs also require new users to go through a time consuming sign up process. Users on the other had, whenever they sign up for such programs need to repeatedly share their personal information.

An important reason why businesses run loyalty programs, besides increasing their sales – is to understand customer behaviour. However, the average user does not actively use most of these programs because the value of the incentive provided is usually not worth the hassle of carrying another card or downloading another app. What’s worse, customers are unable to swap earned loyalty points for programs they are more interested in. This leads to users getting apathetic towards such reward programs, robbing businesses of the chance to capture vital customer data.

Blockchain technology provides ways to address the issues with legacy loyalty programs by giving businesses and their customers an option to deal in common, universally accepted cryptocurrencies. Under the new-age blockchain based loyalty programs, customers earn cryptocurrencies as discounts, cashbacks or reward points. Multiple businesses accept the same cryptocurrency as payments, so customers can use earned loyalty points in ways they wish. Even minimal amounts of rewards do not need to go unused – these could be aggregated and exchanged for discounts against more products and services.

Some analysts criticize coalition loyalty programs where businesses use common reward points to be detrimental to business interests since customers can take away cryptocurrency earned from your business to shop at other places. Also, customers could bring in cryptocurrency  earned elsewhere to buy your products, thus seemingly not contributing to your sales as much they would have by utilizing your own loyalty points. However, recent trends suggest to the contrary – that benefits of coalition loyalty programs could far outweigh perceived inadequacies by driving participation and encouraging users to spend more.

So what’s in it for merchants?

  • Many more merchants who previously could not afford to deploy their own loyalty program can now do so. The cost to implement a coalition loyalty program based on blockchain technology is expected to be significantly lower than before.
  • Merchants can expect more customer visits and increased sales due the heightened spending stimulus provided by reusable reward points.
  • Businesses stand to gain better understanding of customer behavior better due to more available data.
  • Merchants can employ innovative techniques to attract customers based on their spending habits, demographics or location.

What’s in it for consumers?

  • Users can avail the benefits of more loyalty programs without having to give up their personal information each time to sign up for such programs.
  • Users could manage and reuse all their reward points using one single app or rewards card. Collecting reward points could be as simple as scanning a QR code or swiping a ‘universal’ card.

So where is the action happening?

Sure enough, last 2-3 years have seen a lot of activity this front, and a few early movers have taken lead in implementing cryptocurrency based loyalty programs. Following is a list of 10 such blockchain projects with the same general idea, but vastly different implementations:

Project URL Currency Symbol Blockchain
EZToken https://ico.ezpos.io/ EZT Ethereum
Nexxus Coin http://www.nexxuscoin.com NXX Ethereum
Incent https://www.incentloyalty.com/ TM-INCENT Waves
Elements https://theelements.io/ ELM Bitcoin
Plus Coin https://pluscoin.io/ PLC Ethereum
Gatcoin https://www.gatcoin.io/ GAT Ethereum
Qiibee https://qiibee.com/ QBX Ethereum
Loyyal (Company) http://www.loyyal.com Hyperledger Fabric
Reward Tokens https://rewardstoken.io RWRD Ethereum
Loyalty Coin https://www.loyaltycoin.ch LYC Graphene (BitShares)

 

Proof of Existence using Blockchains

One prominent feature of blockchains, the underlying technology behind Bitcoin and many other cryptocurrencies is that their decentralized and distributed nature makes it difficult to tamper with data once it gets validated and accepted in the blockchain. Blockchains are designed to make it very difficult for anyone without a substantially huge amount of computational resources to forge data, several copies of which are cryptographically secured on a public blockchain. As blockchain technology becomes more secure and widely adopted, it’s opening up possibilities for several other use cases besides digital cash transactions. One such use case is Proof of Existence services.

What is Proof of Existence?

A Proof of Existence is a blockchain powered service that verifies the existence of digital documents at a certain point in time. Proof of Existence service providers usually provide an online platform for users to submit their digital documents such as birth certificates, wills, ownership/transfer of properties, business or other documents.

The service cryptographically converts the contents of the documents to a hash value in a blockchain. The original document is disposed off and only its hash value is stored. It is highly unlikely for different documents to have the same hash value, and it’s impossible to reverse engineer a hash to obtain the contents of the original document. Thus, a document’s hash value together with the timestamp of the blockchain acts as a proof that the document existed at that given point in time.

What are the benefits of a Proof of Existence service?

Some benefits include:

  1. Provides a convenient way for users to prove that they own a certain document, without needing to disclose the actual contents of the document.
  2. Provides a mechanism to check the integrity of data – a document when uploaded every subsequent time would generate the same hash value which would prove that the document has not been modified.
  3. Saves on expensive third party notary fees. Proof of Existence services in comparison are quite inexpensive.
  4. A Proof of Existence, once generated has little chance of getting lost, tempered with or destroyed since it lies on a decentralized, distributed network which mitigates the risks of a single point of failure and stores the document hash in perpetuity.
  5. Users can upload their documents anonymously, so there are few privacy issues.

Who can benefit from these services?

Anyone who owns a digital document and who would otherwise avail the services a traditional notary can benefit from using these services.

What are some Proof of Existence service providers?

The first Proof of Existence service was developed by Manuel Araoz and Esteban Ordano and launched as an open source project in 2013. The service was subsequently acquired by Canaan.

Some other notable Proof of Existence services are Bitcoin.com Notary , Bernstein, Blocknotary, Copyrobo, Origin Stamp, Stampery, Stampd, and Signatura.

A comparison of 20 open source blockchain platforms

As blockchain technologies have emerged, there have been several attempts at classifying them. While there are a lot of blurry lines and little unanimity on how to precisely categorize blockchains, here is another attempt at classification – using 20 popular open source blockchain platforms available in the market.

Basis of comparison

Public or Private

Public and Private blockchains differ on whether or not anyone can freely access the data on the blockchain.

Public blockchains are usually available for everyone to use and explore, and transactions are transparent and anonymous / pseudo anonymous. These blockchains are potentially disruptive due to their ability to cut down on intermediaries and zero infrastructure costs.

Private blockchains impose restrictions on who can view their data – usually the write permissions are central to one organization or consortium while the read permissions may be restricted to a certain (or large) extent. Private blockchains are in general more scalable and provide better compliance of regulatory or privacy rules than public blockchains.

Permissionless Vs Permissioned

Permissionless blockchain networks are open networks which anyone can participate in the process of creating new blocks in the blockchain or executing smart contracts on the network. Permissionless blockchains offer users the freedom from developers, government or other institutional interference and thus can be more popular and widely adopted.

Permissioned blockchains, on the other hand put restrictions on who can execute smart contracts or participate in the process of creating and verifying new blocks on the blockchain. Permissioned blockchains execute such restrictions via an inbuilt access control layer. 

Permissioned blockchains offer better transaction performance than public blockchains, can be more secure and scalable, and offer fine grained access control – just some features that appear particularly beneficial to businesses and enterprises.  

A close analogy to permissionless and permissioned blockchains is the relationship between the Internet and the Intranet. Permissionless blockchains, like the internet are need to be open and neutral to truly benefit from innovation. Permissioned blockchains on the other hand are like the intranet – they cater to smaller, closed communities but still perform some crucial functions nonetheless.

Consensus Mechanisms

Blockchains involve the use of distributed ledgers to record information. One key aspect critical to the functioning of any blockchain is that its network should collectively agree on the contents of the ledger. How the network maintains consensus also impacts the speed, security and scalability of the blockchain.

Blockchain networks have and continue to come up with ingenious ways to achieve a consensus amongst the network. The very initial blockchain networks such as Bitcoin and Ethereum relied on Proof of Work (PoW) consensus algorithms which required participants to ‘mine’ new blocks by investing a lot of computational resources into the network. Several other consensus algorithms have since emerged, such as Proof of Stake (PoS), Byzantine Fault Tolerance (BFT), Proof of Activity, Proof of Importance, Federated Byzantine Agreement (FBA), Proof of Elapsed Time (PoET), Practical Byzantine Fault-Tolerance (PBFT), Derived PBFT, Redundant Byzantine Fault Tolerance (RBFT), Simplified Byzantine Fault Tolerance (SBFT), Federated consensus, Round Robin and Delegated Proof of Stake (DPoS), Proof of Capacity, Proof of Burn, Proof of Identity and Proof of DDoS.

Platform Permissionless / Permissioned Consensus Mechanism Public / Private
Bitcoin Permissionless Proof of Work Public
Ethereum Permissioned Proof of Work Public
Hyperledger Fabric Permissioned Pluggable Consensus Private
Ripple Permissionless Federated Byzantine Agreement (Ripple protocol consensus algorithm – RPCA) Public
BigchainDB Both Federated Consensus Both
Quorum Permissioned QuorumChain (a time-based, majority-voting algorithm), Raft Private
Chain Permissioned Federated Consensus Private
Corda Permissioned Pluggable Consensus Private
BitShares Permissioned Delegated Proof of Stake Public
Hyperledger Sawtooth Lake Both Proof of Elapsed Time, Byzantine Fault Tolerance Both
Hyperledger Iroha Permissioned Byzantine Fault Tolerance (Sumeragi) Private
Waves Permissionless Waves-NG Public
Multichain Permissioned Distributed Consensus (Round Robin) Private
Openchain Both Partioned Consensus Both
Hydrachain Permissioned Byzantine Fault Tolerance (HC Consensus) Private
Monax (Eris) Both Proof of Stake (Tendermint) Both
Stellar Permissionless Federated Byzantine Agreement (Stellar consensus protocol – SCP) Public
Symbiont Assembly Permissioned Byzantine Fault Tolerance (BFT-SMaRt) Private
Nxt Permissioned Proof of Stake Public
Credits Permissioned Proof of Stake Public

 

How to Build Your Own Bitcoin Exchange – Bitcoin News

On the other hand, Bitsquare claims to be a decentralized exchange.  “Bitsquare is an open-source desktop application that allows you to buy and sell bitcoins in exchange for national currencies or alternative cryptocurrencies.” Bitsquare also claims, “The system is peer-to-peer, and trading cannot be stopped or censored.”

Source: How to Build Your Own Bitcoin Exchange – Bitcoin News

5 Best Decentralized Exchanges Which You Can Use To Trade Right Now

Are you afraid of your cryptocurrencies being stolen on centralized exchanges? Are you looking for much safer and secure cryptocurrency exchanges? If your answer is YES (!) for these questions then I think we have the same concerns. Centralized cryptocurrency exchanges are good but not the best in terms of safety when used. Moreover, incidences […]

Source: 5 Best Decentralized Exchanges Which You Can Use To Trade Right Now