8A – Solving The Problem
From part 7
Problem
Businesses have to use traditional payment gateways services as well as accept credit and debit cards which all have high transaction fee. Thus, businesses have to factor that into the cost price of products and end consumers unknowingly pay for it. This is further worsened when tourists go overseas and want to purchase items easily with their digital currency (card) but will have to pay currency conversion fees.
Solution
My solution to this is a cryptocurrency / blockchain supported payment system solution for merchants which of course has a end-user (consumer) app as well.
It will consist of web and mobile solutions for physical stores as well as e-commerce websites.
The project will depend on the TRON blockchain which currently offers up to 2000 transactions per second , much faster than the top mainstream blockchains Bitcoin and Ethereum.
The application would essentially be like Square ( a payment system at physical stores) , and will focus on creating features that merchants find useful for the business like charts and visual graphics and provide business intelligence/ analytics for advanced features. However, it can run on just print outs of QR codes or using a tablet or smart phone to generate dynamic QR codes and to keep track of payments.
The key difference is the ability to lower the costs of operations as transactions can run on the TRON blockchain where the cost of running applications is put onto the blockchain community (nodes) which run servers to maintain the blockchain. This is a key feature of the TRON blockchain, where cost for developers are lowered. This means we can also charge very low fees. My philosophy for this project is that I want to make it fair for users and merchants. It honestly costs very little to move digits around and payment systems should not overcharge. Other than a low percentage fee of around 1% or lower (credit cards are 2%+- and debit cards 1%++) , the plan is to set a max fee of around 10 cents. This is already lower than the banks and payment gateway fees which include a percentage PLUS a minimum fee of around 15 cents or so
The business model is that merchants can accept payments using the project's tokens called TIPS or the native coin of the TRON blockchain called Tronix but using the project's tokens will incur the lowest fees.
However, this means end users need to acquire our tokens. This is where our project is meant to spur the usage of cryptocurrency and showcase the ease of use of cryptocurrency and tokens. Users can easily purchase these tokens from the merchants where they will also gain some bonus credits during the early phases of the project. This bonus is a mechanism created to show consumers that businesses are earning more because of the system lowering the costs of transactions .
Merchants will also be rewarded for making the most transactions and sales of the tokens. This in return builds on the network effect that will make the network more widespread and hence increase its value in using it ( more merchants around the world using the application --> increased ease of spending around the world)
Problem
Businesses have to use traditional payment gateways services as well as accept credit and debit cards which all have high transaction fee. Thus, businesses have to factor that into the cost price of products and end consumers unknowingly pay for it. This is further worsened when tourists go overseas and want to purchase items easily with their digital currency (card) but will have to pay currency conversion fees.
Solution
My solution to this is a cryptocurrency / blockchain supported payment system solution for merchants which of course has a end-user (consumer) app as well.
It will consist of web and mobile solutions for physical stores as well as e-commerce websites.
The project will depend on the TRON blockchain which currently offers up to 2000 transactions per second , much faster than the top mainstream blockchains Bitcoin and Ethereum.
The application would essentially be like Square ( a payment system at physical stores) , and will focus on creating features that merchants find useful for the business like charts and visual graphics and provide business intelligence/ analytics for advanced features. However, it can run on just print outs of QR codes or using a tablet or smart phone to generate dynamic QR codes and to keep track of payments.
The key difference is the ability to lower the costs of operations as transactions can run on the TRON blockchain where the cost of running applications is put onto the blockchain community (nodes) which run servers to maintain the blockchain. This is a key feature of the TRON blockchain, where cost for developers are lowered. This means we can also charge very low fees. My philosophy for this project is that I want to make it fair for users and merchants. It honestly costs very little to move digits around and payment systems should not overcharge. Other than a low percentage fee of around 1% or lower (credit cards are 2%+- and debit cards 1%++) , the plan is to set a max fee of around 10 cents. This is already lower than the banks and payment gateway fees which include a percentage PLUS a minimum fee of around 15 cents or so
The business model is that merchants can accept payments using the project's tokens called TIPS or the native coin of the TRON blockchain called Tronix but using the project's tokens will incur the lowest fees.
However, this means end users need to acquire our tokens. This is where our project is meant to spur the usage of cryptocurrency and showcase the ease of use of cryptocurrency and tokens. Users can easily purchase these tokens from the merchants where they will also gain some bonus credits during the early phases of the project. This bonus is a mechanism created to show consumers that businesses are earning more because of the system lowering the costs of transactions .
Merchants will also be rewarded for making the most transactions and sales of the tokens. This in return builds on the network effect that will make the network more widespread and hence increase its value in using it ( more merchants around the world using the application --> increased ease of spending around the world)
Hi Cory! I really like your idea. The one question I have is how you would deal with credit cards on their end. If users are still going to be able to use credit cards, won't those companies still be charging processing fees? Or, will you be having consumers make an account with you and just use the currency they purchase through you? I'm really interested in seeing the logistics!
ReplyDeleteHey Cory,
ReplyDeleteIn terms of international travel, a system to avoid transaction fees would be such a huge convenience. I don’t know much about crypto, but it seems like crypto currencies fluctuate pretty wildly in comparison to the established fiat currencies. While there may be the safety benefits of crypto, the idea that prices might need to be all over the place to ensure business owners aren’t losing money may scare off a lot of businesses.