I am writing this to address the plethora of comments about prices of tokens and the thirst for their value going up. I hear few people talk about liquidity.
The reason for the price hikes, and the volatility is the lack of liquidity. This means when tokens are offered to sell, there are few buyers and the price is very volatile.
Here is an example —
DCN had a volume of just 1000 ETH and rapid price movements. The point about a token is that it has some kind of currency status (lawyers argue about what exactly is a currency…
I had designed an insurance based solution for payment protection but I then realised that there was a design flaw — the buyer and seller could be the same person and hence they could defraud the fund.
I have now redesigned the protection as follows.
The design requires that money is paid into an escrow account. This money is then used as an asset by a factoring company to pay the supplier of the goods. Hence the supply chain part of the contract is met.
The supplier then supplies the goods to the retailer who then delivers them.
When I started to implement my original design for Zillerium, the sheer scale of payment problems hit me. I had no idea that in almost all of Africa most people use Cash on Delivery (COD) for e-commerce. As I researched this more with a view to implementing an MVP, I realised that without a payment protection system for cryptocurrencies nothing in e-commerce could be done at a significant level for cryptocurrency based sales.
That realisation led to my ZIPS design and the business footing analysis for ZIPS soon revealed that the UK is mainly a cash economy for payments too…
A part of the main Zillerium project is called ZIPS (Zillerium Insured Payment Systems) which is designed and published at zillerium.com. As part of my business level argument claiming why we need fraud prevention, I have included some statistics and evidence as follows.
Blockchains have gained a lot of interest globally for many reasons. One of the key ones is that they allow peer to peer transactions. But also in that architecture, there is one fundamental weakness, the guarantee that the contract between Alice and Bob actually is satisfied.
If Alice agrees to pay Bob 10 BTC for some goods and Bob fails to deliver, Alice has no TTP (Trusted Third Party) to approach. She is left with taking legal action or losing the money.
Taking legal action for 10BTC could work, but if Alice makes 20 transactions some at .01 BTC then…
Since the revolution started in blockchains, I have examined the whole question of tokens. Tokens are a means of putting value to a aspect of something outside of a monetary value.
For example, if students all arrived on time every day, they could get a reward of a timetoken. Then the tokens could be used to measure a good student record. Hence a lot of timetokens could be required to apply for a university place.
If timetokens were very popular then someone might want to buy them and hence a market can start to operate which in effect states the token is used as a kind of college fee, but good students earn the tokens anyway. They could also sell them for money.
At Zillerium we are launching the zillcoin which measures competitive conduct.
I started Zillerium in 9/2016 and today I created and transferred the first zillcoin.
My design implements contract theory in supply chains using blockchains. Under this design companies will use a shared ledger and this will cause an equilibrium in supply and demand.
My site at zillerium.com has more details.
Supply chains are on the eve of a revolutionary change fuelled by advances in Contract Theory, a branch of theoretical economics, and the adoption of blockchain technologies.
The economist write in its publication rebooting supply chains -
The rules of global trade are shifting and companies will need to make sure their supply chains have the agility and resourcefulness to deal with potential challenges and disruptions that may lie ahead. Questions remain about whether the pace of globalisation will slow considerably, shift its direction or possibly reverse.
As economists have worked out now that transparency is the key to solving contract theory problems, we have a solution to the well known bullwhip effect by implementing contract theory onto blockchains.
Zillerium is a project doing exactly that.