Send Protocol Vision — Explained by CTO

What is Send Protocol trying to prove by launching the SDT token on the Ethereum network and what are its long-term plans?

Blockchain has given humanity a transparent way to save and process information without the need for any central power acting as an intermediary, while cryptocurrencies, more specifically, allow people to be the sole owners controlling their own funds. Still, there are a multitude of challenges to overcome before distributed ledgers and cryptocurrencies can replace banks.

The first set of challenges are technical. First-generation decentralized blockchains carry huge cost in terms of efficiency. Thousands of computing nodes processing information simultaneously not only implies extremely inefficient use of resources with resulting energy and environmental costs, but also limits overall processing capacity, making transactions slower and more costly as network size increases; the higher the scale of the network, the less usable it becomes, therefore limiting capacity to compete with centralized systems that, despite their outdated technology, permit the processing of tens of thousands of transactions per second.

The second major group of challenges is market-related. Although the market for cryptocurrencies is booming, it is (counterintuitively) quite harmful to the ecosystem as volatility tends to attract only those who take advantage of it and prevents transactional mechanisms or exchange systems from being created — systems that would offer direct value for end users who turn to cryptocurrencies as a way to buy goods or exchange foreign currency. Moreover, the same transparent, decentralized nature of the blockchain impedes the ability to create mechanisms to protect a currency of this kind from the effects of speculation around technological and financial promises.

The Send token was born at a time when many actors are racing to address challenges related to scalability, security and efficiency. Stellar’s semi-closed groups, IOTA’s acyclic distributed ledger or Cardano’s Ouroboros proof-of-stake algorithm are a few. What we see less often are industry leaders tackling the second set of market-related challenges.

In this context, and capitalizing on the Send team’s experience bringing blockchain solutions to the people, Send created the SDT token, a semi-stable digital money powered by the Ethereum blockchain. Send has taken on the challenge of becoming the global digital currency standard for massive use by reinventing the principles of price formation and implementing mechanisms that shield the currency’s economy from external factors such as speculation. Send is a currency whose reference value depends solely on its use and demand for real transactions.

The basic hypothesis behind Send states that a transparent economy built around an asset that is able to measure its own performance in terms of real use and liquidity, is able to sustain a reference value for limited periods of time while still growing in the long-term as demand and network scope increase. With this idea in mind, Send aims to create the first sustainable ecosystem based on cryptocurrency, the Send Consensus Network, able to use periods of stability to power up all kinds of applications to fulfill daily needs.

Launching the SDT token on the Ethereum network before starting the development of a protocol permits us to validate our hypothesis and demonstrate to the world the ways in which a stable ecosystem backed by smart contracts can generate demand evolution and massive adoption. By growing an ecosystem around specific communities with different needs, Send aims to prove one simple premise: massive adoption is possible and the technology that makes it possible is just one piece of the puzzle.

After proving to the world that an economy driven by liquidity is able to sustain its purchasing power over time in local communities, our hypothesis gives way to the broader vision of a transparent, interoperable, secure and scalable digital asset based on distributed ledger, and protected from external economic factors. Send has defined a transactional volume milestone that will trigger the initial development of its distributed ledger protocol to reach our vision of being the global standard for digital money for the new economy, and a borderless reference of value that makes possession and use of money a universal right.

You can read more about Send’s vision in our Whitepaper at www.sendprotocol.com.