The wallet supports iOS for now but will expand into Android soon.
Oxfam issued tap-and-pay cards loaded with $50 worth of DAI to 200 Vanuatu citizens to use via Sempo’s payment platform, following six weeks of direct consultation with villagers.
Throughout May 2019, United Kingdom-based nonprofit organization Oxfam International executed a month-long trial that saw MakerDAO’s DAI stablecoin distributed as a means of exchange among citizens of Vanuatu. The Oxfam initiative, named UnBlocked Cash, was conducted in partnership with MakerDAO, ConsenSys and Australian tech startup Sempo. The Australian government also supported the program.
Tsunamis, cyclones and volcanic eruptions comprise a constant concern for the citizens of Vanuatu, with WorldRiskReport describing it as the world’s most at-risk nation to natural disaster for five consecutive years. The month-long program saw 200 residents of the Vanuatu villages of Pango and Mele Maat issued tap-and-pay cards loaded with roughly 4,000 Vanuatu vatu (approximately $50) worth of MakerDao’s DAI stablecoin.
Local vendors who agreed to participate in UnBlocked Cash were provided with Android smartphones with an app facilitating the processing of DAI payments. The vendors were also able to convert DAI into fiat currency through Sempo‘s cryptocurrency exchange or any other platform, if desired. In total, 34 vendors participated in UnBlocked Cash, including local stores and schools.
Approximately 2,000 transactions were recorded during the pilot. Due to privacy concerns, an individual’s purchases were not tracked. However, the program recorded the general category of purchases — such as “medicine,” “food” or “bills.” During May, 5% of all new DAI addresses were created by the citizens of Vanuatu.
Cash trumps in-kind provisions
According to Australian media outlet Micky, contemporary research indicates that providing aid in the form of a liquid means of exchange is significantly more effective than giving in-kind support, such as food and other basic provisions.
The publication approximates that roughly “70 percent of Syrian refugees have been forced to sell in-kind donations for cash so they can buy the items that actually need to suit their personal circumstances.” The provision of cash also serves to encourage local economic activity.
Sandra Uwantege Hart, the head of Oxfam’s Pacific Cash & Livelihoods in Vanuatu, told Cointelegraph that “Oxfam was already managing a portfolio of activities designed to scale cash transfers as a means of delivering disaster assistance across the Pacific region” as early as 2017. She continued:
“Typically, cash transfers are much more efficient than providing goods as a form of aid relief, but they are also slow to set up and often bogged down by lengthy financial reconciliation processes and slow monitoring and reporting, which is often difficult for donors to verify. We saw the potential for higher transparency, rapid analytics and automated transaction tracking typical of blockchain solutions as a vehicle to improve and accelerate our cash transfer programs and ultimately make them more responsive to people’s needs.”
According to Hart, it took Oxfam “a while to find the right tech provider to get this solution off the ground before settling on Sempo through an RFP process. Sempo stood out from the pack as one of the only tech providers who fully understood both sides of the equation we were trying to solve — how cash transfers work, and how to design blockchain solutions in a local context-adapted way to make them work for the people who need them the most.”
Sempo’s platform operates offline
Speaking to Cointelegraph, Sempo’s Melanie Hardman described that the platform’s mission is to solve the challenges encountered by both vendors and customers who seek to conduct trade in periods of crisis. Hardman said:
“Our platform consists of: an app used by vendors as a ‘point of sale’ platform, an e-voucher or ‘tap and go’ card which hold a balance of funds and is used by recipients to make purchases, and a dashboard managed by the Oxfam team, where they can enroll and approve program participants, disburse funds and monitor transactions.”
The platform is able to continue operating offline by “cryptographically recording recipient’s balances on tap-to-pay smart cards, which are then synced at a later point.” The platform also does not require recipients to have access to a mobile phone and does not require users to undergo Know Your Customer (KYC) identification checks, which Hardman described as “critical,” given that many people living in the developing world lack identity documentation.
In late 2018, Sempo used its platform to deliver cash aid to refugees based in the Greek city of Athens, Iraqi Kurdistan, as well as Beirut and Akkar in Lebanon. According to Sempo, the programs saw the “creation of a digital credit transfer platform that is easy for both vendors and recipients to use, regardless of literacy and existing levels of financial inclusion.” The company also noted that it was able to increase the transparency of the program by leveraging distributed ledger technology.
Stablecoin issuance as cash aid
Sempo’s Nick Williams told Cointelegraph that MakerDAO and Sempo developed a process for UnBlocked Cash that distributed DAI-backed digital vouchers, which were redeemable for fiat currency, to Vanuatu citizens.
“Dai was used as collateral for a special e-voucher, which means that vendors can be reimbursed by anyone who meets the regulatory requirements of the Vanuatu Government. This gives the platform capacity for much lower cost overheads, as well as creating the foundations for open financial ecosystems in the communities that need them.”
Greg DiPrisco, head of business development for the Maker Foundation, told Cointelegraph that “Sempo was convinced that Dai was the best solution for their needs and thus went through the proper channels to ensure that they could use it in the pilot.” DiPrisco described the initiative as “a testament to the power of a decentralized stablecoin to empower disenfranchised populations.”
Sempo’s Hardman stated that the company was selected by Oxfam to provide its cash transfer platform technology for the Unblocked Cash pilot following year-long discussions between the two entities regarding “the potential to revolutionize the cash transfer space using blockchain.” Hardman continued:
“Sempo was invited to put forward a proposal by Oxfam as part of their RFP process. This involved Sempo presenting an initial presentation on our work to date, and then developing and submitting a proposal, which we did in partnership with ConsenSys.”
Claudio Lisco, strategic initiatives lead at ConsenSys, told Cointelegraph that the company was engaged by Oxfam alongside Sempo “to assess the time, cost and quality of digital cash based transfer programs” after the nonprofit became aware that ConsenSys had built a financial inclusion platform in conjunction with the Union Bank of the Philippines, titled Project i2i. Lisco stated:
“ConsenSys aided in the initial design of the pilot, provided blockchain advisory and communications support, and evaluated the pilot to make recommendations for future utilization and scaling potential. We were on the ground during the pilot, to document and collect data insights, and conducted interviews and filming. We are now producing the debrief report, video case study, and advising on future developments and how iterations of the cash transfer program can be scaled.”
Pilot program seen as success
While Sempo and ConsenSys will meet with Oxfam during the final week of June to discuss the pilot’s findings — and whether there is potential to employ the program at scale in Vanuatu and other regions — representatives of the entities involved indicate that the program was seen as a success.
Oxfam’s Hart stated that Oxfam’s previous cash assistance programs in Vanuatu involved a setup process that “took between 30 minutes and an hour of long lines and verifying paper lists.” According to Sempo’s Hardman:
“Within the pilot, enrolment times were reduced between communities from 5.4 minutes to 3.6 minutes, demonstrating significant time savings when compared with other cash transfer modalities, where recipients may have to attend a registration session, return at another time to verify their identity, and then travel to collect a cheque.”
Hart concluded that there were significant gains in the speed with which Oxfam was able to pay vendors, emphasizing meaningful participation on the part of many small, community-level merchants, who rarely take part in assistance programs due to typically being unable to wait weeks to be paid. Hart explained:
“Now, with weekly payments, virtually all vendors in this trial were small scale and community based, and located within walking distance for most recipients — this means that we are enabling small-scale community economic recovery that is more inclusive and better adapted to people’s purchasing habits.”
Pilot program produces “unprecedented” transparency
Transparency has long comprised a fundamental value proposition put forward by cryptocurrency, with the UnBlocked Cash pilot demonstrating the advantages digital currencies offer over opaque means for distributing public finance. Hardman stated that the initiative “provided high levels of transparency for Oxfam and their donor, the Australian Government, as administrators were able to see transaction data in real time both on the Sempo dashboard, and the public blockchain.”
Hardman also reported that Vanuatu community members indicated that Sempo’s platform would be the preferred modality of aid issuance in future disaster scenarios, attributing such to the greater ease of use afforded to recipients when compared with other forms of cash aid. However, she also noted, on reflection, that Sempo would like to see the platform’s offline data reporting functionality strengthened in order to improve monitoring.
ConsenSys’ Lisco described the program as showcasing the unique value propositions of cryptocurrency technology, concluding that Sempo’s platform offered significant efficiency advantages over cash, checks and other traditional methods for distributing financial aid. He continued:
“The pilot demonstrated that direct donations (without any intermediaries or administration) are possible utilizing Ethereum-based stablecoins. This method of transfer was also significantly cheaper for small donations. For instance, bank transfers to Vanuatu from Australia cost approximately $20 AUD. An Ethereum transaction, by contrast, averages less than 10 cents in AUD.“
Oxfam “highly likely” to continuing using stablecoins to distribute aid
Moving forward, Hart indicated that Oxfam is currently in the process of compiling reports aimed at showcasing the UnBlocked Cash initiative, and that it will “seek out the resources to be able to plan longer-term, and look at how we scale up this innovation in the Pacific, and elsewhere.”
Joshua Hallwright, Oxfam Australia’s humanitarian lead, told Cointelegraph that it is “highly likely that Oxfam will use stablecoins or other distributed ledger technologies to provide cash aid in disaster responses in the future, either in Vanuatu or elsewhere.”
Hallwright noted that “Oxfam is exploring the use of distributed ledger technologies because of their potential to change power dynamics and address inequities,” adding:
“As DLTs become ever more present in society, Oxfam is engaging in their development and impact in line with our goals of eliminating poverty and reducing inequalities. Oxfam is currently piloting six different uses of DLTs, globally, and sees these pilots as producing important insights that will shape future DLT applications in crisis responses and more broadly in emerging economies.”
The program showcases the potential of cryptocurrencies to facilitate far greater efficiency in the provision of resources, especially within the developing world and in response to crisis formulation. It is also good to hear that more such trials may take place, which could lead to a wide-scale adoption of crypto in the disaster relief sector.
Programmed to boost rankings, increase liquidity of tokens, and sabotage competitors, bots are challenging the integrity of Dapps.
From fixing ads and loyalty programs to ensuring ethical sourcing of products, here’s how blockchain can make retail more efficient.
Cryptocurrencies have gone a long way since the day when, nine years ago, Laszlo Hanyecz had paid 10,000 bitcoins for two large Papa John’s pizzas, marking the first purchase of tangible goods for digital money. Although bitcoin is still far from being universally accepted by retailers, thousands of merchants around the world are taking crypto in exchange for goods — and their ranks grow daily. The latest of the big developments in this vein came up at this year’s Consensus conference, as blockchain startup Flexa made public its partnership with a number of major U.S. retailers. Flexa’s payments app, Spedn, will allow users to pay for their purchases in more than a dozen stores of the caliber of Barnes & Noble, Office Depot and Whole Foods with cryptocurrencies.
Payments, as we know, are just a tip of the blockchain iceberg, though. While expanding the number of stores and chains that accept digital money remains an important avenue leading toward mass adoption, there are several other domains where distributed ledger technology (DLT) can be of help to the retail industry. Some of these solutions are already up and running, and some hold the promise to bring about massive changes within the next few years.
There is evidence that cryptocurrency payments are gradually moving away from the fringe. The Kaspersky Lab Global IT Security Risks Survey, published in February, reported that a respectable 13% of more than 12,000 consumers across 22 countries have used cryptocurrency to pay for their online purchases.
Companies that step on the path of accepting crypto might be driven by various motivations. Some might want to appeal to younger, technologically advanced customers by appearing savvy with the cutting-edge tech, while others embrace the promise of the technology and are bullish on crypto themselves. Digital money’s volatility remains the main deterrent for large corporate retailers. Intermediaries like Flexa, which are ready to stand in between corporate businesses and the dicey crypto market to absorb part of the uncertainty, come in handy as the big players find themselves willing to experiment with the new payment method yet are wary of potential risks.
It appears that this indirect model could become a dominant means of easing major retail chains into digital money payments in the next few years. For instance, this is how the recently announced crypto-payment partnership between Starbucks and fintech firm Bakkt is expected to work.
This running list tracks major stores and services that accept cryptocurrencies. You can already spend your digital money on travel, gift cards, jewelry, games and movies, moving services, gadgets, goods for your home and more. The list will surely keep growing.
Blockchain’s capacity to facilitate transmission of both value and information can give rise to more sophisticated, multifunctional forms of payments in the near future. A recently unveiled Civic Pay app is a vivid example: The solution will enable vending machine operators to simplify access to age-gated goods by combining payment, identity verification and earning reward points in one transaction.
Another important domain of the retail business that could use some optimization and enhanced fraud protection is loyalty programs. A primary tool for building a lasting relationship with a customer, these transaction-based programs oftentimes rely on infrastructure that is less secure than that of “real” payments, leading to a substantial increase in loyalty-fraud crime in recent years. Both value and personal data are subject to theft. In addition, many reward programs fall short of providing enough value to customers, as the ways of spending the hard-earned points are limited.
Introducing blockchain into the equation could help retailers address both issues. On the security side, hackers and fraudsters will have a much harder time penetrating a system that relies on a distributed ledger than one that stores all the data in a centralized database. In terms of consumer value, creating a token-based rewards ecosystem open to third-party businesses is a means of giving customers a wealth of diverse ways to spend their points.
This is exactly what American Express is looking to achieve with its Hyperledger-based rewards platform, which is geared toward enabling partner merchants to create customized rewards offers for the financial corporation’s clients. A prominent player in the space is Swiss firm Qiibee, which specializes in helping businesses tokenize their loyalty programs.
Supply chain tracking
Another well-established and profusely covered family of blockchain use cases in retail has to do with the technology’s capacity to make the goods’ origins transparent and verifiable. The demand for such transparency may stem from different considerations, depending on a particular industry, with three key concerns being safety, authenticity and ethical sourcing.
The United States Centers for Disease Control and Prevention, the arm of the federal government responsible for promoting and protecting public health and safety, estimates that each year, 48 million people get sick, 128,000 are hospitalized and 3,000 die from foodborne illness. Outbreaks of diseases like E. coli and salmonella caused by bad groceries are still nothing irregular, and once the contaminated produce makes it to a large retailer’s enormous supply chain, it becomes difficult to track its origin in order to quickly extinguish the threat. It may take days until the source is identified, potentially causing the chain heavy losses and putting customers at risk.
Industry leaders have come to realize that recording every actionable event along the produce’s journey — from farm to table — on a blockchain is an efficient solution to this problem. It could also enhance stores’ ability to quickly identify and remove recalled foods, among other logistical benefits. The IBM Food Trust initiative, which offers its members a blockchain-based platform to track produce on every step of the supply chain, launched in the fall of 2016, when the U.S. retail giant Walmart began testing the system. Since then, Walmart has started requiring suppliers of certain types of produce to implement the DLT-powered solution. Other U.S. and global players in the field — such as Albertsons, Unilever, Nestlé and Carrefour — have joined the club as well, and many more are poised to follow suit.
Closely related to food safety but a conceptually different consumer demand is the need to verify that the product in question has been ethically sourced. As millennials and gen Z-ers are becoming the driving force of global capitalism, concerns over businesses’ environmental and social responsibility are becoming an increasingly conspicuous factor in purchasing behavior. Again, recording the product’s journey on an immutable ledger and creating a consumer-friendly interface enabling customers to obtain a clear picture of its origins can become a powerful tool for companies to build trust and get rewarded for transparency and responsible sourcing practices.
Some examples include the World Wildlife Fund-Australia championing the use of OpenSC, a supply chain tracking tool built on blockchain, to enable consumers make ethical choices when purchasing food. Customers will be able to obtain information regarding the products’ origins and life cycle by scanning a QR code on the package.
On another note, the Ford Motor Company is testing an IBM-built system running on Hyperledger Fabric that will trace supplies of cobalt — a material used in lithium-ion batteries that is seeing increased demand as the electric vehicles market expands. A large share of the world’s cobalt is mined in the Democratic Republic of Congo, where child labor and slave-like working conditions are widespread. The blockchain initiative would address these issues by providing Western corporations with a means of ensuring that the cobalt they purchase comes from the mines where a certain level of labor protection is enforced.
Finally, when it comes to luxury consumer goods, being able to establish the provenance of an item is of utmost importance. The diamond industry’s largest players, such as Alrosa and De Beers, have adopted blockchain-based solutions to track gems from mine to store and verify that their origins are clean — in both literal sense and with respect to previous ownership. Luxury apparel brand Alyx will implement Iota’s blockchain solution to showcase sustainable practices used on every step of its supply chain.
Customer data management, security and sharing
Retailers routinely record, store and utilize vast amounts of customer data. Blockchain applications related to streamlining processes in this line of their work present a less explored yet immensely promising area. Harnessing the benefits of distributed ledger technology could improve security, give customers more control over their data, and create new forms of marketing to help retailers meet consumer needs with higher precision and capture the value otherwise missed.
With the help of an artificial intelligence-powered recommendation system, retailers would be able to identify customers’ needs and advertise highly tailored offers to them. With advertising expenditures thus optimized, merchants will be able to reward those who opted into opening their data with tokens spendable at the store.
With a blockchain data-sharing system in place, customers could also proactively let retailers know about their needs and preferences, sending them shopping lists in the form of smart contracts. Coupled with the potential affordances of the Internet of Things to outsource the execution and delivery of such orders to machines, blockchain could become a fundamental infrastructure for the new era of fully automated shopping.
Blockchains are useless on their own. For decentralized computing to work, they must intersect with other solutions. writes Intel’s Mic Bowman.
Coinbase links its main app to its wallet product, allowing users to fund the wallet directly from Coinbase.com accounts.
According to the company, Coinbase Wallet is slightly different from the main app, referred to as Coinbase.com. With the latter, a customer’s cryptocurrencies and private keys are stored by Coinbase. With Coinbase Wallet, users store their own crypto protected by their unique private keys.
The exchange has explained that the wallet can now be connected to accounts on its main platform for quick transfers from the main account to the wallet. As per the announcement, Coinbase Wallet will be updated within a few days and users will then receive an in-app notification to activate the new feature.
In future, the company promises to allow customers to send crypto back to their main account from the wallet.
Lately, Coinbase has been in the middle of a scandal following its acquisition of blockchain intelligence startup Neutrino for $13.5 million. Previously, Neutrino was allegedly affiliated with Hacking Team, which purportedly sold surveillance capabilities to governments and law enforcement agencies.
As the the crypto community launched a hashtag #DeleteCoinbase, urging users to cut ties with the exchange over the acquisition, the company moved to fire Neutrino staff with prior connections to Hacking Team.
In other crypto wallets news, the official wallet of major crypto exchange Binance, Trust Wallet, has recently added support for credit card purchases and crypto asset XRP. Yesterday, another crypto wallet, Abra, launched native Ethereum (ETH) support, previously only offering exposure to the crypto as a “synthetic asset.”
Sephora has joined the list of retailers at which shoppers can earn bitcoin rewards via the Lolli app.
Gemini has launched a mobile app with full functionality, allowing customers to buy, sell and transfer funds, among other features.
Lithuania-based company carVertical, who developed a platform for used car history reports, has been granted a ticket to the Volkswagen (VW) Future Mobility Incubator in Dresden, as the company became the winner of a manufacturer’s pitch competition, says the official press release. The event was held on May 31 in Riga, Latvia.
According to the press release, the decision was announced after numerous teams of entrepreneurs held their presentations at the event organised by German-Baltic Chamber of Commerce. As the expert jury noted, carVertical convinced them with their idea of using blockchain to record vehicle histories.
carVertical will begin work in Die Gläserne Manufaktur, Volkswagen’s innovation hub in Dresden, in September 2018. The incubation program also includes financial support of €15,000.
The outcome of the project is the joint development of blockchain-based solutions. This is supposed to enhance Volkswagen’s presence as the leader for future mobility applications and provide carVertical with valuable resources and expertise.
“In connection with the program, Die Gläserne Manufaktur also offers the assistance of mentors and coaches, an attractive working environment at the facility, high-quality IT infrastructure, contacts with Volkswagen research and development employees and decision-makers, professional advice by Sächsische Aufbaubank (SAB), close proximity to the start-up scene and both financial and personnel support from the City of Dresden”, says the press release.
Automotive side of blockchain
According to representatives, carVertical is considered to be the most successful automotive-based initial coin offering (ICO). The team has reached its goal, having raised almost $20 mln during its ICO campaign in January 2018.
The history records app is designed to prevent used car frauds, as stated in the carVertical blog. In the app a user may find records by car’s Vehicle Identification Number (VIN) located in its technical passport or on a car’s body.
The company’s roadmap includes various applications centred on the decentralized vehicle history registry. The first application is the platform of vehicle history reports, which is set to debut later in June.
“Our goal is to enable every car buyer around the globe to get authentic and non-faked information about the specific vehicle and to help consumers in the maintenance of their vehicles”, states the carVertical website.
A few months ago, the company announced a partnership deal with GPSWOX, a provider of global GPS tracking solutions, as reported by their blog. At the moment, carVertical tech team is working on the hardware specifications for its installation units.
Furthermore, carVertical’s initiative to build global and tamper-proof vehicle history registry is supported by European Union. The company’s board of advisors contains of current or previous executives of car manufacturers, cyber-security experts and blockchain professionals.
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Germany’s second largest stock exchange, the Stuttgart Börse, which reportedly has a trading volume of $100 bln, has announced it is launching a zero-fee cryptocurrency trading app, Thursday, May 17. The smartphone app, dubbed ‘Bison,’ will be free to use as of fall 2018, and has been developed together with fintech startup Sowa Labs.
Four cryptocurrencies – Bitcoin, Ethereum, Litecoin and Ripple – will be supported from the app’s launch, with additional digital assets promised “in the near future.” The interface and trading process aims at convenience, forgoing the need for crypto wallets or paperwork.
The platform also gives users an artificial intelligence (AI) data analysis tool, ‘Cryptoradar,’ which analyzes over 250,000 crypto-related tweets from the crypto sphere daily to give real-time insight into community sentiment. As of press time, Cryptoradar’s algorithm on the Bison website shows Bitcoin, Ethereum, Litecoin as neutral, with Ripple edging towards the positive spectrum.
A prototype of the app was presented today at the finance and investment trade fair Invest in Stuttgart, with Dr Ulli Spankowski, Managing Director at Sowa Labs, commenting that Bison “is the first crypto app in the world to have a traditional stock exchange behind it.’ Sowa Labs claims that their survey of over 1,000 participants showed that the majority of investors would like “easier” access to the crypto markets.
Last week, Cointelegraph reported on stock trading mobile app Robinhood raising $363 mln in funding in order to expand its crypto-specific platform US-wide, with plans to support 16 different cryptocurrencies, all zero-fee. With the recent funding, Robinhood became the second most valuable fintech startup in the US, with a current valuation of $5.6 bln, and an SEC-compliant broker-dealer status, unlike leading US crypto trading platform Coinbase.
Beyond convenient entry points into the crypto space for individuals, perhaps the most important precedent for Stuttgart Börse’s new crypto venture is the New York Stock Exchange owner’s recent announcement of its own plans to offer Bitcoin (BTC) swap contracts that would be settled in BTC, allowing its traditional Wall Street clients to both buy and hold the cryptocurrency.