AMA: SCO Lab Interviews Token Network
Liesa Huang from NULS: Hello everyone, welcome to our SCO Lab AMA for Token Network. Let’s bring out our special guests tonight from Token Network, their CTO and Co-founder Ashutosh Sharma and their CEO Patrick Howard.
Ashutosh Sharma (CTO and Co-Founder) is a high-tech executive and Founder at Token Network and many other companies. His love and passion for technology and innovation is incomparable. Prior to founding token network , Ash founded many companies since the age of 13 and has been developing software and applications since the age of 10. Ashutosh is also an alumni from famous Draper University.
Patrick Howard ( CEO and Co-Founder）believes in empowering people and following the notion that the sum of many is greater than the sum of one. He has 10+years experience in technology and business, and is also the CEO of Token Trolley.
Liesa Huang: First of all, lets have the CTO and Co-founder Ashutosh give us a brief introduction on the Token Network and what it does.
Ash: Token network is an open-source e-commerce platform built using NULS Chain Factory. Token Network is backed by The Web Company to jumpstart and start using blockchain with their existing clients. Token Network is a proof of credit blockchain with smart e-commerce contracts that allows e-commerce businesses to start using blockchain for their daily business transactions.
- Token Network’s vision is to build a platform for e-commerce entrepreneurs and developers to build their business with fewer intermediaries, allowing them to maximize their revenue. We want e-commerce entrepreneurs to delight their customers with a transparent and fair base system and deliver the best services to them with all transparency.
- Our mission is to bring global trading on the blockchain system. We want to bring borders together and make it easier for business to trade globally without resistance and provide a virtual governance for globalization.
Liesa Huang: What are the problems that e-commerce industry faces today and how is Token Network solving them?
Patrick Howard: The global ecommerce industry has seen consistent explosive growth rates, growing from $1.336 trillion USD in 2014 to over $2.29 trillion in 2017. Mobile implementation of e-commerce stores has greatly improved the accessibility and convenience of online shopping. Still, the industry faces several problems. These include:
· Counterfeit goods
· Expensive and long payment processes
· Needless middlemen
· Avoidable fees
· Cross-border trading is difficult due to governance
· Trust and reputation-building
Token Network blockchain is built for e-commerce which solves some of the issues listed. Below are some of the proposed solutions for problems. For more details please visit our whitepaper.
Trust and Reputation-building:
- Token Network’s smart contracts allow for far more than just the efficient transfer of monetary value or digital assets. They also allow customers and merchants to review and rate each other. Due to the immutable nature of blockchain, the information and data stored in these contracts cannot be manipulated or altered in any way, allowing customers to make far more informed decisions that would not have been available through centralized authorities.
Liesa Huang: How many tokens will Token Network allocate to their SCO, and what is the inflation rate once Token Network migrates to native token?
Ash: 40% of the initial token issuance which is 40 million will be going towards SCO. The initial issuance for the token network is 100 million and there will be a 500 million maximum supply for TNT. There will be a maximum of 20 million tokens created using Proof of Credit consensus per year.
Liesa Huang: Can I ask a question to the CEO, Patrick? How is Token Network currently funded?
Patrick Howard: Currently Token Network is backed by The Web Company and most of it is self-funded.
Liesa Huang: Why do choose an SCO over ICO or IEO?
Patrick Howard: When we discovered this model of SCO, we immediately wanted to engage because we feel this model can be replicated for e-commerce business on our chain, and plus with the SCO model we believe it is the best way to build a loyal community base rather than spending heavy money on marketing which only values price appreciation. The SCO model also protects investors and community members and that is really appealing to us as company. Most projects who raise funds with ICO or IEO have extreme pressure to deliver the project, and can ended up also in heavy regulatory scrutiny when not delivered on time.
Liesa Huang: But SCO & IEO, ICO are not against each other…
Patrick Howard: We believe the SCO is more community-driven. For Token Network, this type of project needs more support from the community. It is most suitable for SCO model in order to build its own community. Community is the soul for any blockchain project.
Liesa Huang: Another question to Ash, why has Token Network choosen NULS?
Ash: Token Network is about 2 years old. We have been developing silently, and we noticed NULS around the end of 2018, and saw the possibilities with NULS. After being one of the Alpha test environment partners, we immediately decided to use NULS ChainBox and Chain Factory to build our chain. Our chain is designed for e-commerce and retail business. With NULS technology we believe that we can help small to medium sized e-commerce businesses adopt our chain, thus making their business more efficient.
Liesa Huang: On behalf of the core team, we thank Token Network for choosing NULS. What is the go-to market plan for Token Network?
Ash: Our plan is to first build a transaction blockchain network, and then build a smart contract application so that it allows other people to issue tokens on top of our chain. Once this step is complete, we will roll this out to our network of e-commerce businesses via The Web Company. Our backing company allows us to easily market and immigrate business to adopt our chain quickly. We already have seen some interest from many of our partners to use our chain in near future. One of the notable partners that we will be presenting our chain to is Rolex Australia for their brand authenticity and supply chain management tool.
Liesa Huang: How much funding do you need to complete the project?
Patrick Howard: We are estimating around 250,000 USD to complete stage 1 of the project. To further take us to stage 2 and marketing level, we will be needing another additional 500,000–1,000,000. We are estimating that we will be completing the project under 5 million USD.
Liesa Huang: So Patrick, what is the benefit Token Network’s TNT holders?
· Incentives to community members for rating merchants and services
· Discounts on transactions within the marketplace, and more.
· Enabling merchants faster liquidity for their income
· Consumers or merchants can become part of the network by staking their coins and holding nodes.
· In the future, businesses will have the ability to issue their own tokens on top of the Token Network.
Liesa Huang: I feel like this answer can be divided into so many questions. Indeed, Token Network is a big project, its not easy to digest it all at once.
Patrick Howard: Yes, however we are working on MVP first to get adoption started. Minimum viable product.
Liesa Huang: It sounds like you have very close ties with The Web Company. Can you please tell us more about this company, and also what is Token Trolley?
Patrick Howard: The Web Company is a Swiss Army knife when it comes to web services. As we have been in business since 2004, we like to think we know what we’re doing. It’s the collected experience of our entire team that allows us to help with any projects thrown our way.The Web Company has delivered over 1000+ websites and software solutions to it’s clients. The majority of our clients are from e-commerce and retail backgrounds, which and this is one of the advantages we have for Token Network: we can plug Token Network blockchain into the e-commerce space.
Token Trolley is an e-commerce marketplace developed by The Web Company, and is a test bed marketplace to bring this business to consumer websites. Token Trolley works alongside Token Network to enhance early adoption of the decentralised marketplace.
Lisa Huang: Does Token Network as an e-commerce platform have existing clients who are using their services? If so, how many?
Patrick Howard: Token Network is currently working with The Web Company , which has well over 1000 e-commerce businesses and clients. We will be first plugging our platform into The Web Company clients and users. We are now starting to building our blockchain solution to kickstart the network. The Token Network solution is designed in a way that does not really change the infrastructure of businesses and lets them carry on with business as usual. The will be using our solution without even noticing it.
Liesa Huang: What is the killer set for Token Network entering e-commerce? Why do upstream merchants choose to work with you instead of Alibaba, or Amazon? I don’t quite understand the irreplaceable value of Token Network in e-commerce?
Patrick Howard: Token Network is open-source unlike the enterprise blockchains that are private and thus centralized. With Alibaba, the model for them is plugging private blockchains into exisiting business.
Lisa Huang: What is the plan for Token Network’s development? Do you intend to get listed on exchanges? If yes, what is the timeline and plan?
Patrick Howard: We are looking to SCO at the end of September, around 15–20th or thereabouts.
Liesa Huang: For e-commerce business, blockchain is not at the core of this industry. Without BlockChain this industry still operates the same..
Patrick Howard: Token Network is not only working within the e-commerce space, but we have built a liquidlity engine called “Bpay” which will allow merchants to not lose value in their transactions.
Bpay is our another company that will be developing stable coins, for transactions and also a Visa card system so people can spend. This is something we will release shortly later this year, but it will be built on top of Token Network, and people can spend the stable coins using a Visa card.
Liesa Huang: Visa card presents the same legal issues Libra faces though?
Patrick Howard: Libra has a different set of issues, mainly they will be biggest bank if they go ahead and regulators dont like that.
Liesa Huang: I have another question. What is Token Trolley? Is it another product of Token Network? Can you please describe it?
Patrick Howard: Token Trolley is a marketplace built by The Web Company to bring The Web Company clients into the marketplace, and the second stage is to build this Token Trolley platform as a hybrid marketplace which has decentralised capabilities.
Liesa Huang: For businesss to tokenize themselves in your network and issue, do they need TNT locked up or are they required to possess a percentage ratio of the tokens they are issuing?
Patrick Howard: No, there is no lock up required, however there will be community voting mechanism for each capital raise that happens.
Liesa Huang: Why do the members of your shops need to use your token for settlement? Is there any benefit of doing it?
Patrick Howard: With Token Network blockchain we are able to reduce middlemen involved in each transaction, and at the same time we are able to provide a trust based system which is immutable.
Ash: Yes there are benefits including a full end-to-end solution for merchants and better accounting mechanics.
Liesa Huang: How do you accomplish this without the settlement of the middlemen?
Patrick Howard: By using an automnated escrow system, we are able to fully reduce the cost of transactions on centralized marketplaces.
Liesa Huang: What is an automnated escrow system?
Patrick Howard: Most current business transactions require trust. The blockchain network’s main feature is its ability to operate in a trustless environment. For example, one of the primary functions of an Ethereum based smart contract is an escrow to hold and release assets automatically when certain conditions are met. In many application scenarios outlined in our White Paper, the network would need to hold certain escrow or pledged TNT from multiple parties until a certain outcome occurs. This level of automation can make escrow much more prevalent and widely used in our society. For example, in a sales transaction, the smart contract could release the TNT in escrow to the seller when the seller’s shipping carrier sends back a delivery confirmation to the network. Or the escrow condition may be that when the buyer inspects the product and agrees to accept it. If the buyer does not accept it, the automated arbitration process begins. Also, with a distributed ledger system, we are able to prevent security flaws which a centralized system has trouble providing.
Liesa Huang: What is Token Network’s strategy when it comes to “legal compliance” for overseas exchange platforms?
Patrick Howard: We are hoping to get TNT on exchange around Q4 of this year.
Liesa Huang: What are those exchanges?
Patrick Howard: Hitbtc, Upbit, Trade.io and there is one coming out in the Middle East in which my friend from Saudi Royal family is involved. So, we are in talks with these people at the moment, but of course we are happy to get more exchanges.
Liesa Huang: One last question to Ash: What’s the relation between businesses that issue their own token and TNT?
Ash: Businesses who issue tokens have their own tokens which they issue to their customers, similar to how people send loyalty cards. They can give tokens which are highly liquid and cash out, unlike loyalty cards which are specific to the store. Second, we have plans for asset tokenization and with this it is best for businesses to create their own asset-backed tokens.