Loyalty tokens on OST (part 1/2): Pushing mainstream adoption of crypto-currencies
A lot of critical voices warned in the past bull market, that crypto-currencies prices are simply based on speculation and hype. When looking on the charts, in the bear-markets all crypto-currencies were loosing a lot of their value (up to 10–20x and more for so called “alt-coins” in comparison to 3–4x for Bitcoin and Ethereum) so they have been obviously right.
But how to stabilize and grow the value of these tokens while avoiding traders and leading crypto-currencies to drop the prices so hard?
There are multiple drivers on the horizon that will support this goal. Like when the trading volume on exchanges moves to new trading pairs with stable currencies like fiat currencies (classic money like USD or EUR) or stable-coins (crypto-currencies that have a stable value). Or the fact that a wider base of market participants becoming more experienced and the trust in this new technology markets will become stronger. This will leads to lower impact of news and also less fluctuations as the markets become more mature. And the more money flows in, it will become also more stable and makes it harder for individuals to move the prices.
But the real solution for this issue will be the adoption, means usage of the crypto-currencies and -tokens to create a real demand.
Real demand will drive up and stabilize the prices dramatically, as long as it’s a steady demand and not just based on single events. But this adoption will be a hard and slow process because mainstream consumers and companies needs to get used to this new vehicles for transferring values first. Bitcoin is already pushing in this direction since 10 years.
But both parties, consumers and companies, already use loyalty points.
You may know loyalty points, a customer binding tool in the marketing toolbox, probably from airlines (“miles”), independent companies (“payback”), hotels or online-shops. Also in Asia I recently ran into Grab points, vivo rewards, shopback, wink plus!, just to mention a few. There are plenty of companies and projects that shows… it simply works and people are using it.
This is where the first big adoption chance comes into play for distributed ledger technologies and especially OST Simple Tokens, the brand tokens for “everyone”. To understand why blockchain is the perfect use-case for loyalty points, please read Blockchain Tokens vs. Points Programs — 9 reasons why companies and customers should care.
OST Simple Token —could provide branded customer loyalty programs on the blockchain as a service.
Loyalty tokens based on OST Simple Token would need to address different types of customers:
- Smaller companies that could benefit from a loyalty point program
- Bigger companies that are interested in a loyalty point program
- Companies that already have a loyalty point program
Smaller companies are open for cheap and easy-to-setup services to provide their customers additional value, while the bigger companies requires way more B2B sales effort, as long as OST is not an established loyalty point service. Companies that already have their point program will require complex migrations from their legacy systems, so they are definitely out of scope in the beginning.
So OST Simple Tokens should allow small and modern fast moving companies to easily use OST branded tokens economies as a loyalty program in their e-commerce systems.
The first important and most easiest step would be the coverage of all major e-commerce system with loyalty points (add-ons) based on OST Simple Token.
Like coinbase wants to become the major and easy payment method for crypto-currencies in e-commerce systems, OST should become the blockchain based loyalty point program.
If we think this further, the integration in modern existing POS (Point-of-Sale) system could be a second step, to reach also smaller offline retailers.
Like mentioned in an interview, the planned OST Wallet (which should be also brandable in a later step) and the branded token exchange (to convert it into fiat) are crucial components for this vision, to become the loyalty point program service.
In our next article we will discover the needed common functionalities for these loyalty point addons for all major e-commerce systems, give some comments to the planned OST Wallet and suggest further integrations and partnerships that would help to grow the OST eco-system, as a leading crypto-project.