Recently, the BLUCON project team announced that it has completed the administrative contract procedure for the CARD payment service that reflects the real-time market price of BTC, ETH, NEO and the foundation’s BEP token. One of the issues that have consistently emerged in the process of being renamed virtual currency, cryptocurrency, crypto-asset, etc. is whether it will be able to take charge of the ‘payment function as currency’. Coinhubkorea explores these perspectives one by one and provides services. I would like to summarize the meaning of BLUCON CARD ahead of its launch.
1. Bitcoin ATM through ATM
2. Payment platform through remittance between wallets
3. Membership expansion using a membership crypto card
4. Cryptocurrency recharging card using prepaid card
5. Real-time payment by linking exchange wallet and real financial card
Readers interested in cryptocurrency may have heard more or less about the propositions listed above. However, without expertise, it is difficult to grasp the direction, limitations, and marketability. I would like to look inside and organize these models.
One direction pursued by the above propositions is that it is a business model created by various efforts to bring cryptocurrency into real life, and the models listed above are written in the order of appearance.
1. Bitcoin ATM through ATM
It is a model that has appeared in the world in various forms since the first half of 2017, when Bitcoin began to shake the world. In the early days, with a lack of understanding of bitcoin and cryptocurrency, it has received a lot of attention as it appeared in a plausible package, but it does not seem feasible to reporters.
In order for this to be possible, the authorized online network and transaction prices must be reflected in real time, and the movement and stability of cash to be in charge of deposit and withdrawal must be secured, but in reality, this cannot be achieved unless it is a banking company operating the existing financial network.
2. Payment platform through remittance between wallets
Representatively, Bitcoin Cash and Dashcoin attempted to implement this, but despite years of efforts, they failed to secure an affiliated store where payment was possible. No matter how fast the transmission speed is, it is difficult to reliably reflect the price that fluctuates in real time, and there is no affiliate store to accommodate it.
It is said that there are thousands or tens of thousands of affiliates that Bitcoin Cash has secured over the years, but there are millions of affiliates in Korea alone. How can you afford this?
So, it can be said that such a project, where securing a franchise is the key, was not feasible from the beginning.
3. Affiliate expansion business using membership-based crypto card
At one time, ‘our coins can be used to pay at some coffee shops and restaurants in Gangnam, and we will continue to expand affiliate stores. So, if you buy our coin, you will be able to pay with a variety of cryptocurrencies as well as increase the price.” This is also an impractical concept.
As with the wallet remittance payment platform, it may be possible to use membership cards of several franchise companies, but it is impossible to secure a universal franchise.
4. Cryptocurrency recharging card using prepaid card
From item 4, it is “makes sense”. Payment is possible with this ‘cryptocurrency recharge card’. This is because the card network of the existing financial system is used. But it’s ‘burying your head in the sand’.
Looking at the contents, 1) if you apply for cash conversion from a specific coin’s wallet, 2) the Coin Foundation will manually convert it into cash and store it as points on a prepaid card. 3) The user takes the card and makes payment at the affiliated store.
However, this case is consequently the same as “selling the cryptocurrency on the Upbit Exchange, converting it into cash, and paying with a K Bank prepaid card”. In other words, it is the act of putting a certain amount of money on the card as points in advance.
5. Real-time payment by linking exchange wallet and financial card
Item 5 is the most ‘reasonable’ content among the methodologies so far.
By linking the exchange wallet where the individual stores cryptocurrency and the financial card network
It is a method of linking the exchange wallet where the individual stores cryptocurrency and the financial card network to “make it possible to pay as much as necessary in real time using the existing card network (Visa, Master, UnionPay) for cryptocurrency.”
To summarize this method, the payment network means that the payment network uses the card network of the existing financial system as it is, and the individual converts the cryptocurrency contained in the exchange’s wallet in real time as necessary to make payment.
In other words, if you eat pizza for lunch and pay 8,000 won, the payment is made by deducting only 8,000 won of the bitcoin or specific coin in the exchange wallet based on the settlement price at the time of settlement. This method satisfies the needs of users who want to own and use cryptocurrency.
To explain, the purpose of holders of cryptocurrency is to increase the value of cryptocurrency. In other words, among the two values of cryptocurrency (decrease or increase), holders had because of their value increase. (They want to hold them in cryptocurrency, except for fiat they need.) So, they want to hold the assets in cryptocurrency, and only want to be paid in cryptocurrency as fiat as needed.
Blucon’s cryptocurrency CARD system is a service based on item 5’real-time payment linking exchange wallet and financial card’. In addition, since it uses an existing financial network card, the services of item 1, item 2, and item 4 are naturally possible.
However, in order for BLUCON to realize such a payment system, the development of the platform is also important, but it had to overcome the high hurdles of approval from the existing financial network, that is, credit card companies and banks. It is said that the BLUCON project team has been discussing with domestic and foreign financial institutions for a long time to solve these difficulties, and As a result, it is said that the contract was signed with Unionpay and the final development was started for the launch of the service.
It is expected what role a small startup started in Korea will play in the fiercely competitive global financial market.
