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The Internet of Shopping: Blockchain Solutions to Consumer-Retail Challenges

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It’s possible that blockchain, as a disruptive tool for innovation, will successfully shake-up and improve upon the existing hegemony seen in consumer retail. We have already seen this happen in many other areas, like traditional finance.

Projects such as Ethereum stand testament to the fact that blockchain has far surpassed its original use-case (as a decentralized payment solution).

Furthermore, developments around the nascent technology are proceeding at remarkable speeds for the consumer market – at varying levels of accomplishment.

We would like to take this opportunity to further explore some of the more prominent examples, what their goals are, and how their teams seek to achieve them to give you an enhanced perspective on what we can expect in the future.

BC / AD: Before Cryptocurrency / Anno Decentralization (A Prologue)


Image Source: Pixabay

Consumerism and retail shopping have long been a cornerstone of modern civilization: with tangible benefits that apply to society, politics and the economy.

One of the greatest epitomes of this growth was reached in tandem with the growth of early commercial internet technology, through to Web 2.0.

Many new market leaders rose from the ashes of the burst dot-com bubble, as well as the Western economic recession of the early 2000s. All under the banner of ‘e-commerce’

Since then, we have arguably seen a stagnation in the traditional retail shopping sector. Brick-and-mortar stores are in constant decline in many areas of the Western world, as well as shopping malls closing down throughout the USA (dubbed by some the ‘Western Retail Apocalypse’).

Amazon currently possess 41% of US e-commerce retail sales, according to Statista. A number which is projected to increase to 50% by the year 2021.

1. Blockchain for the Unbanked and Borderless Payments

According to the data from The World Bank’s Financial Inclusion Database (or ‘Findex’) 1.7 billion adults were recorded to have been ‘unbanked’.

‘Unbanked’ denotes individuals who do not have access to traditional financial services, for the most part living in developing countries. The largest of these is China (225 Million), closely followed by India (190 Million).

Banking institutions have demarcated the differences of opportunity and accessibility between classes – both domestically and between the ‘first’ and ‘third’ worlds. They have also acted as gatekeepers to a broad range of valuable services and functions: such as international payment transactions, and currency conversions.

Being without a traditional centralized bank doesn’t have to mean you are ‘unbanked’ however, as blockchain and digital banking providers are proving. These populations alone provide a massive use case.

Shops, service providers, and many other possibilities have been left wide open, and we’ve already seen some examples of organizations attempting to resolve this issue….

Cryptocurrencies like Bitcoin for example are a cheap and fast means to send money and furthermore, allows for those ‘unbanked’ to access digital consumer markets with ease.

IBM is another organization responsible for a unique solution to the issues of the ‘unbanked’ seeking to send cross-border payments by using peer-to-peer (P2P) blockchain technology.

Travelers and migrants are a great example of the potential beneficiaries for this type of project. This is because making international payments in developing countries can often be error-prone, costly with transactions in different currencies – requiring multiple-intermediaries to process them over days or sometimes even weeks

2. Shopping Loyalty Programs, by way of Blockchain.

Loyalty rewards programs have existed for a long time as a means of attracting a greater level of sales and custom in a repeat manner, as well as for the gathering and interpretation of shopping data to provide insights and historical data analytics.


Image Source: Deloitte Center for Financial Services – ‘Making blockchain real for customer loyalty rewards programs’. 2016.

Their age is telling however, as the lack of development on this front regarding the benefits offered to both users and program providers has remained somewhat static for a long time now, with little in the way of improvement or progress.

It has become a burgeoning issue, that these types of programs are perceived as unfulfilling to many, with a high level of market penetration when considering the percentage of households enrolled – however a low number of overall utilization of the points or cards by said households.

There are a number of interesting platforms which claim to provide a solution to this issue, which include some which we have covered ourselves in great detail before (see our review of Eligma for example), as well as others we would like to discuss more in the near future.

One of the latest of these is Gabrotech, which positions itself as a 6-in-1 solution. Its user-centric and comes with a multi-currency crypto wallet that offers seamless P2P transfers, and loyalty redemption capabilities among others.

The platform has a multi-currency conversion engine (MCCE) that allows for borderless payments in any place that accepts MasterCard. It utilizes a liquidity pool that converts ‘any supported blockchain asset to the appropriate fiat currency at market value in real-time’.

This brings empowerment to the swathes of unbanked peoples, representing a breakthrough moment for a gigantic population of the world.


Source: Presentation by Pani Baruri, ‘Blockchain Powered Financial Inclusion’

Gabro’s core strength lies within its token Gabro (GBO). It’s a utility token solely designed to work within its ecosystem. Users are rewarded with GBO through spending, conversion or friend referrals.

Through its Loyalty Central feature, it removes the requirement for multiple accounts to manage multiple loyalty programs and allows for the simple swapping and consolidation of loyalty points. This will allow for idle and / or lower credited programs to be topped up and utilized to their fullest.

Blockchain technologies are already disrupting the financial industries; unbanked and cashless societies are tipped to benefit the most from the technology. Interestingly, the loyalty market, worth approximately $500 billion USD, is also to have its full potential realized.

3. Account Data, Personalized Customer Experiences, and Product Recommendations

Research within the retail sector has long existed as a practice. The dawn of big data and other new technologies such as automated data processing, however, have led us into a new era of insights (best known as customer analytics).

Shopin is a token-based platform which seeks to use blockchain technology in order to create user data profiles / accounts which are transferable and inter-operable between different participating merchants across the web.

In addition to providing absolute security and empowering users through control over their data and its security, merchants are incentivized by having access to powerful on-boarding tools and deferred liability regarding data protection.

The platform also incorporates machine learning / AI systems and data relationship protocols to provide product recommendations to its users on the customer / consumer side.

If you are interested in learning more about this solution in particular, check out our ICO review from April this year.

Featured image courtesy of Shutterstock. 

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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Overstock.com Shares Spike 17% After Chinese Private Equity Firm Pledges $270 Million for tZERO

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Shares of Overstock.com (OSTK) surged in after-hour trading Thursday after a major Chinese equity firm agreed to invest in tZERO, the blockchain subsidiary vying to reshape the investment world through a SEC-regulated alternative trading system (ATS).

GSR Capital to Invest Heavily in tZERO

CNBC confirmed on Thursday that Hong Kong-based GSR Capital will invest up to $270 million in tZero. The investment is based on a valuation of $1.5 billion, giving GSR an 18% stake in the new blockchain startup. GSR will also buy $30 million worth of tZERO security tokens.

“We are honored to have GSR Capital as a strategic investor,” said tZERO CEO Saum Noursalehi in a statement, as quoted by CNBC. “The tokenization of securities has the potential to disrupt global capital markets responsible for moving hundreds of trillions of dollars. Together with our partners, we will globalize our blockchain-based platform, bringing more efficiency, liquidity, and trust to capital markets.”

The announcement came less than six weeks after GSR Capital signed a letter of intent with Overstock to purchase $160 million worth of security tokens.

Launched in December, tZERO’s initial coin offering (ICO) has raised $134 million to finance its ATS infrastructure, which will provide a regulated venue for securities trading. The company plans to build similar systems around the world.

Despite a highly successful crowdraise, documents submitted to the SEC earlier this year revealed a target of $250 million. Independent valuations had placed tZERO’s ICO anywhere between $200 million and $500 million.

Overstock.com Spikes

Overstock.com’s share price was up by as much as 21% after-hours. It would eventually settle at $45.40 for a gain of 17.6%.

As the following chart illustrates, the OSTK price rose 4.5% in regular trading on Thursday to settle at $38.60.

Despite the gain, OSTK has been a dismal performer this year. Share prices are down 40% year-to-date, vastly under-performing the Nasdaq Composite Index, which has returned more than 14%.  What’s more, the stock is trading at less than half of its 52-week high.

Overstock’s share price has been rocked by disappointing quarterly results and the cancellation of a proposed public stock offering. Last March, the company offered four million shares of common stocks before abruptly cancelling those plans. Noursalehi said the decision to pull the offering was due to “market volatility and price.” To be sure, OSTK had declined 20% following the initial announcement to issue common stock.

Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.6 stars on average, based on 546 rated postsSam Bourgi is Chief Editor to Hacked.com, where he specializes in cryptocurrency, economics and the broader financial markets. Sam has nearly eight years of progressive experience as an analyst, writer and financial market commentator where he has contributed to the world's foremost newscasts.




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A Closer Look at Boerse Stuttgart’s New Cryptocurrency Platform

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The Boerse Stuttgart group has is expanding upon past product launches to create a complete holistic ecosystem for digital assets, including cryptocurrencies. This comes on the heel of them launching the “Bison” app, which allowed users to trade cryptocurrencies with zero fees, similar in functionality to that offered by Robinhood.

The difference between Bison and Robinhood, however, is that the Boerse Stuttgart group is the second largest derivatives exchange in Germany. Another unique feature of the Bison app was its “crypto radar” feature.

This functions as a social media tool that aggregates more than 250k tweets and analyzes them to determine the “mood” of cryptocurrency investors.

Having an existing (and profitable) large financial firm expanding their brand to cryptocurrencies in any capacity reflects a market that is increasingly accepting the reality of institutional capital flowing into crypto markets.

The new ecosystem is composed of three distinct pillars. Bison represents the first of these pillars. The second is a branded platform for initial coin offerings to sell tokens. The third is a safe custody solution for digital assets.

This ecosystem, in turn, falls within Boerse Stuttgart’s so called “digitization” strategy and should serve as a bellwether of changes to come in financial markets. After all, as an established market player, Boerse Stuttgart Group has extensive knowledge in the fields of technology, regulation, and trading models respectively.

According to their own CEO Alexander Höptner, “On this basis, we can offer central services along the value chain for digital assets, all under one roof. Investors and market participants know that Boerse Stuttgart Group stands for quality, transparency, and reliability. As a Germany-based provider, we want to transpose this standard into the digital world. We will help to promote acceptance of digital assets.”

The key to their ambitions focuses on solving two major problems. The first is that KYC procedures tend to be overly complex for average investors, as well as time-consuming. The Boerse Stuttgart group’s own KYC solution allows traders to pass KYC and start trading within minutes, as opposed to more typical solutions that take a few days.

The second issue they are tackling the liquidity and accessibility of ICO tokens post-sale. They solve this by allowing tokens launched through their platform to be traded within their broader ecosystem using Bison.

According again to the CEO, “At the trading venue tokens issued via our ICO platform can be traded on the secondary market. This is an important success factor for ICOs. At the same time, we are responding to demand from both retail and institutional investors for a regulated and reliable environment for trading with cryptocurrencies. Furthermore, established cryptocurrencies like Bitcoin or Ethereum will also be traded.”

This approach will likely serve to establish the Boerse Stuttgart group a prime recipient of crypto-intrigued institutional capital. After all, the early bird gets the worm. A key component of this future success also rests on how well they partner with authorities.

This exact point was also emphasized recently by the CEO, who said, “In designing the strategic projects we closely cooperate with all competent boards and committees, and especially with the supervisory authorities.”

While it remains to be seen whether retail investors make use of this ecosystem, it seems reasonable to assume that larger investors will flock to a simple crypto-specific ecosystem backed by an old guard stalwart of finance.

Featured image courtesy of Shutterstock.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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MasterCard Could Be Your Best Friend

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Since just after the financial crisis, I have been searching for a way to beat MasterCard and Visa at their own game. These two brands dominate the business of processing debit and credit card transactions.  I have always considered this duopoly as the enemy of mankind, but could turn out to be a hasty judgement.

MasterCard and Visa don’t actually process transactions as much as they offer an electronic network and charge fees for the use of their name.  They collect about 0.11% per card swipe which ain’t much until you consider they are running more than 150,000 transactions per minute through their network.  Pretty nice business to be in. All together, the two will generate about $30 billion this year.

The problem with both of these guys is that it is impossible to get around them.  If you buy something anywhere in the world with a debit or credit card, it is almost guaranteed to run on either the Visa or MasterCard network.  In which case, in addition to the 0.11% taken out for the network, the store that accepts your purchase pays anywhere from 3% to often as much as 5% in total for processing fees.  And if you travel abroad and charge something, well forget about it. Everywhere along the network are intermediaries taking their nick of your wallet.

When foreign currency transaction fees are taken into account, that is where more intermediaries are included.  That is where the costs add much higher and that is often where the consumer is hurt most.

Fighting Back

The whole idea behind blockchain technology is to make transactions of all types fast with little or no dependency on intermediaries.  All this makes MasterCard and Visa the enemy of cryptocurrency developers. But neither of these brands are sitting still applying for patents on blockchain based payments methods.

The natural reaction is to sell to sell your crypto and find some easier way to earn a decent return.  We disagree: we think there is crypto to be made from MasterCards strategy. Here is why you should be encouraged.

ome time back, MasterCard applied for a patent on blockchain technology that created a link between crypto and fiat currencies. MasterCard is not alone, as there are any number of crypto projects with the same idea.  Recently we looked at TenX and there are others.

Using TenX for comparison, MasterCard’s recently awarded patent offers to convert crypto to fiat using the existing MasterCard network.  TenX and many others plan either create their own high speed mainnet or use the Ethereum platform.

In head to head competition, this gives MasterCard a sizable advantage since MC is pretty much accepted by merchants everywhere.  As much as I hate the duopoly represented my MC and Visa, right now they could turn out to be the best thing to happen for one simple reason.  They will unquestionable accelerate mass acceptance of crypto.

Their existing network and transaction speed, immediately solves the lingering Bitcoin/Ethereum issue of scalability.  In addition as observers have pointed out, both MC and Visa have had systems in place to identify fraudulent transactions.

Having said all of this, is MasterCard going to kill all other crypto payment wanabys like TenX and others? Before concluding the answer is yes, consider this.  In their recently released quarterly review to shareholders, MasterCard reported net income of $2.33 billion on revenue of $5.24 billion. That is a whopping profit margin of 44.5%!  This towers over extraordinarily profitable companies like Apple at 20.3% or the average US corporation at less than 10%.

When MasterCard’s blockchain system goes into use, it will plump up those already MC margins. So, as a crypto investor, you have to ask yourself, do you actually think that MC will pass on those savings or wallow in the cost savings?  The answer is pretty obvious.

MasterCard Could Be The Best News

Crypto naysayers are the first to deny that Bitcoin and others are a legitimate medium of exchange.  This is based largely on the limited number of mainstream merchants that are in the crypto loop. MasterCard could help take crypto mainstream and that would be a good thing for major names like Bitcoin, Bitcoin Cash and Ether.  And with the payments processing business dealing in over $50 trillion in transactions annually, there will be room for startups offering high speed scalability at lower cost. It will not happen this year but it will happen.

Featured image courtesy of Shutterstock.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.4 stars on average, based on 96 rated postsJames Waggoner is a veteran Wall Street analyst and hedge fund manager who has spent the past few years researching the fintech possibilities of cryptocurrencies. He has a special passion for writing about the future of crypto.




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