Digitalbits

predators999 (25)in #blockchain • 5 years ago

Blockchain technology, also referred to as distributed ledger system, is most noticeably known for providing the foundation of the peer-to-peer (P2P) cryptocurrency and payment system Bitcoin, but nowadays there a various different platforms out there. In the context of LRP (Loyalty and Rewards Points) programs, blockchains have the potential to enable interoperable and holistic platforms for the next generation of loyalty programs. Blockchain-based LRPs can be easily transferred and redeemed - even across other businesses or services. In addition, LRPs become interchangeable and can be exchanged for other loyalty points or even fiat currencies. A blockchain-based solution significantly reduce development, integration, reconciliation, and security costs for the program providers.

In recent times, nearly a dozen companies announced their solutions to launch blockchain based LRP programs to encourage customer engagement. However, most of them merely translate the legacy LRP programs into a blockchain based solution with separated data silos and a lack of interoperability. Others are built on first generation blockchains, such as Bitcoin and therefore, suffer technological downsides such as high transaction fees, limited scripting languages or missing scalability. High liquidity results in a significant increase in the number of transactions that need to be performed on a daily basis. They have to further take into account that there could be spikes in the amount of transactions during the day, based on consumer behavior patterns. A large part of the transactions are expected to be performed online. Their infrastructure has to be upgraded in order to cater these demands. A cloud-based system is appealing, however, in addition to the huge cost, this requires in-house expertise in maintenance, dynamic scaling, and security.

In contrast, we envision a solution that is not only limited to ease the creation, transfer and exchange of LRPs on a blockchain but also offer an easy-to-use platform which allows the tokenization of all kinds of assets at the mere click of a button. This, as a result, fosters the mass market adoption of blockchain technology.