2017 was the year of the initial coin offering (ICO). In August 2017 alone, more than 400 companies sought to raise development and operational capital through issuing company specific tokens in return for liquid cryptocurrencies – Bitcoin, Ethereum, etc.
As each of these companies conducts offerings and distribute their tokens into the cryptocurrency ecosystem, the number of coins that make up the system in question increases. As we head into the new year, the total market capitalization of the cryptocurrency market comes in at just shy of $660 billion.
There's a problem, however.
Right now, only the most liquid and top-tier currencies can be used in real-world transactions. And even these coins – Bitcoin, Litecoin, Ethereum, etc. – are only accepted by a tiny proportion of retailers across the globe. Essentially, this means that the vast majority of coins, while being used to some degree for various tasks associated with the platforms, technologies, and companies that created them, can't be used to transact in the real world.
So what's the solution?
One company thinks it has the answer – MoxyOne.
MoxyOne is a company that's about to conduct its own ICO, with the funds raised in the offering set to be used for the development of secure debit card and payment infrastructure for every company, project, and ICO that issues cryptocurrency tokens. That sounds like a big ask but take a look at the way that MoxyOne is going about achieving this solution and it looks remarkably simple and, in turn, elegant – in concept, that is. The company has created a wallet and cryptocurrency system that links up to a mobile device application and allows users to make payments at millions of points of sale globally (basically, anywhere debit and credit cards are accepted) through a physical debit card or a mobile device payment system.
So how does it work?
The MoxyOne model has two crucial components.
The first is what's called Just In Time Funding (JITF), which is a protocol that allows for the (essentially) instant conversion of a particular token or cryptocurrency to the fiat currency that's local to the retail point of sale at which the individual is trying to transact.
The second is a liquidity provider, which is the party that buys the tokens from the individual and – in doing so – allows for the above-described JITF process to take place. These LPs receive the full amount of the tokens from the MoxyOne user as well as a number of extra tokens that serves as the LP's fee for facilitating the transaction. When the tokens are received, the LP refunds MoxyOne for the purchase total.
What this means is that by the time the merchant receives the funds that underpin the transaction, they are denominated in fiat.
In turn, this negates the necessity for the merchant in question to accept cryptocurrency – indeed, chances are they will have no idea that cryptocurrency was exchanged as part of the JITF protocol that preceded the merchant processing side of the transaction.
On completion, the funds are debited from the users account with MoxyOne, the merchant gets their fiat, and the transaction is recorded on secure blockchain technology.
So how does this work with the wider crypto space?
The above-outlined system is designed to work with SPEND, which is a cryptocurrency that MoxyOne has developed and is issuing as part of its ICO. However, the company is also able to white-label the system so as to allow it to integrate with practically any other cryptocurrency.
In other words, another company (call this one Company A) will come to MoxyOne and say they want to allow their token holders to spend tokens in the real world. MoxyOne will work with Company A to brand the platform and the debit cards to fit with Company A's image and the LP will be set up to exchange the tokens issued by the Company A (say these are called COMPA) for fiat when users transact.
This means that anyone that holds COMPA can use the Company A debit card (which has been white-labeled based on the MoxyOne platform and transaction system) can spend their COMPA, just as they could fiat, at any of the millions of retailers globally that accept credit and debit card payments.
The company intends to list its SPEND tokens on Cryptopia as part of an agreement that's already in place shortly after the token sale completes. Social will be white labeling the MoxyOne infrastructure to issue their own custom debit card for SCL token holders, with debit card distribution slated for the final quarter of next year (MoxyOne's system should be ready to go by the third quarter of 2018).
There are more details available in the whitepaper, here.
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