RECAP: Co-CEO Richard on Telegram AMA with Pantera ICO
Hello members of the Carry Community!
On July 26th Friday last week, Carry Protocol’s Co-CEO Richard Choi has participated in a Telegram AMA, hosted by a professional Korean ICO reviewer Pantera ICO. Although the AMA took place in the late Friday night, many have attended and discussed Carry Protocol.
During the AMA session that lasted nearly 1 hour and 40 minutes, we could find many excellent questions and interests in our project, especially regarding Carry Protocol’s plan for the ecosystem and commercialization.
For those who missed the event, we have summarized the questions and Richard’s answers below.
Pentera ICO AMA Q&A List
1. Carry’s partnership with SPC group has made headlines, but how many people actually received cryptocurrency instead of reward points?
Our event with SPC group was to provide Carry tokens equivalent to the value of Happy point obtained from a purchase, which is double-rewarded during the event period. Carry token was not a substitute of Happy point, but both of Carry tokens and Happy points are provided.
2. Is there a stronger strategy prepared for expanding, producing, and circulating Carry Protocol in the local economy?
Carry team is currently working with various companies that have many local stores, such as SPC Cloud operating Happy Point in 6,000 stores, Dodo Point installed in 10,000 stores, and Petdoc with 3,000 pet clinics holding 90%of the pet market share in Korea. We are having strategic discussions with various industry verticals, including restaurants, coffee shops, lens, beauty, etc, to expand Carry’s ecosystem.
3. Will we be able to make payments with CRE someday, like paying CRE for lunch or dinner at restaurants in the real world?
Carry team is working hard to bring CRE to every day world. So stay tuned for our updates!
4. With the announcement of token distribution change, I think unlocking 14M tokens everyday instead of once a month will be a burden for token holders and new investors. Why did you decide to change the distribution schedule? Considering there are many remaining tokens still waiting to be unlocked, the possibility for the price going down is high. Therefore, the new traders won’t like to buy Carry tokens. Please explain if there’s another benefit for the traders to buy CRE tokens.
Let us first share our post of the announcement and the details of the distribution changes. (https://bit.ly/2SfPhlJ)
Carry Protocol is moving toward the development of the project, with the goal to deploy Carry service to 10,000 stores at the end of this year. Also, we have several marketing campaigns in place and activities to promote our service to the new users from the beginning of next year. We believe that next year will be the starting point for Carry’s ecosystem and token economy.
Carry token economics is designed to lower the circulating supply and to increase the demand of CRE tokens with staking mechanism. Since the service will launch next year, we have made adjustments on the distribution schedule and volume to reduce the current circulating supply. With the new unlocking structure in place, we will reduce 30% of the total circulating volume by the end of this year, which will significantly influence the market price.
We changed the distribution plan taking into consideration our past records and also by benchmarking other projects to distribute tokens everyday instead of unlocking large volume once a month. Unlocking once every month increases selling pressure from investors at the same time. The new distribution plan prevents the traders from selling huge volume at once, and protect the price of the totkens, as we could find the other projects’s cases.
5. When you say protecting consumer’s purchase data on blockchain, this means there will be someone who can access the data with all the details. If there’s anyone who intentionally or maliciously leak the data, what kind of measures can you take? I am curious if there’s any government policy or Carry team’s plan for regulation regarding this issue.
So far there isn’t any specific blockchain data security or relevant policy announced by Korean government yet. However, as Carry team is aiming to use the blockchain in real world, we plan to operate the service in accordance with the existing personal information security policies. For instance, the customers are rewarded with Carry tokens by sharing the purchase data anonymously, even if there’s someone who agrees to share identifiable data, we will automatically block it. We are also thinking about giving penalty to staked tokens for intentionally leaking the data or not using it in the manner Carry ECA defined.
6. According to the white paper, the mainnet launch and API release were supposed to be finished in the first half or 2019, but there isn’t any news yet. Is it delayed?
Since launching the project early last year, the schedule of several events has changed. The crowd sale of Carry tokens has been delayed by more than 3 months compared to the initial plan, and also listing on the exchange took much more time than we expected. However, we will be working on product development to meet the original goal, to complete the connection of wallets and devices at the end of this year. We are planning to distribute the system to 10,000 stores until then.
7. What is the strength of Carry Protocol’s blockchain adoption model, compared to the traditional loyalty points of the offline stores?
Carry Protocol is a project that empowers consumers by giving back the control of offline purchase data, enabling their own privacy management and monetization of the data, unlike the existing system which the company is making profits with consumers’ data. Many people understand Carry as a reward system on blockchain, but here we want to point out that ‘reward’ is just one of the features of Carry Protocol, and our core feature is ‘Enabling data control’.
Additionally, there are many advantages of using blockchain based reward system. For example, the existing reward system where all the loyalty point data are on one entity’s database, the entity can easily change the policy or period. However, this is not the case of Carry Protocol. Also, the tokens are basically programmable, so it allows us to implement more functions than the traditional loyalty points.
8. A loyalty point should have a fixed value, but the price of tokens is very volatile. So how will you adopt the tokens to the offline market?
First, I want to strongly point out that Carry token is NOT a loyalty point. The loyalty point stores offer as reward is ‘Brand Token (BT)’, which is incompatible with Carry tokens (CRE). Carry tokens (CRE) are the reward that Carry provides to consumers, and its price is driven by market flow on the exchanges. Consumers will be rewarded firstly with Carry tokens when they share the purchase data, and will also receive the tokens from the advertisers for watching the ads.
In short, the loyalty point is ‘Brand Token (BT)’. Stores or service providers should stake Carry tokens (CRE) to issue BT. Brand tokens are not listed on the exchanges, so there isn’t price volatility. On the other hand, CRE are tokens consumers receive for sharing data and watching ads, and is listed on the exchange, so there is price volatility.
9. I think it will take more time to use Carry’s ecosystem in real life.. How does the team think about the time needed for the ecosystem to be ready for the consumers?
People use the Internet and smartphones, and that does not mean all the people have a deep understanding about TCP/IP technologies for the operation. I think blockchain also needs to be a service that is easy to use without understanding its technological details. Carry’s strength is to make a offline blockchain service used by everyone’s daily life. However, I agree that it will take some time. It is expected that we can have more users than the other similar services at the initial stage, since Dodo Point’s number of users broke record — it’s now over 20M! — with over 150,000 daily transactions.
10. What benefits do advertisers receive if they run ads on Carry? Is there a real use case?
Currently, there are a lot of online purchase data for advertisers, but it’s hard to check how consumers spend their money at offline stores. Since the data on Carry directly shared by consumers has a lot of offline purchase details, advertisers can send more accurate targeting ads to the consumers. From the consumers’ point of view, there will be less spam, and more interesting ads. Also, the response to the ads will be more active since they will be rewarded with CRE for watching the ads.
11. What are the benefits for the offline stores to use Carry’s system? Is there any difference before/after using Carry?
Using Carry’s system, stores can easily implement advertisements, with targeting the right customers. In Korea, there are still many people handing out flyers on the street, to promote their stores. This means there isn’t any better way for advertisement yet. Carry will take a closer look at consumers’ offline purchase information and send them ads with rewards to gain more efficiency.
12. I’ve read that Carry Protocol’s second MVP is on field test from this July. To commercialize the MVP, Carry needs many companies joining ECA. Is there any planned for joining the new ECA member, or any company having discussions?
We are actively engaging in many companies both domestically/globally. Currently, many big enterprises in Korea have blockchain TF so we were able to start discussions with them. Actually, there were some companies who have contacted us first. While reviewing, we consider the number of stores, or APP service they have. We expect to have partnerships with franchises, big enterprises, start-ups with the store services, wallet providers, or loyalty point service providers, etc. Since it’s difficult to have a large number of users in a short period of time, we are discussing partnerships with these types of companies. We cannot disclose the exact details yet, but there will be more news soon!
13. I think the existing loyalty point service market in Korea is a red ocean, since there are many point services from big enterprises such as CJ One Point, Merge Point, Happy Point, etc. Considering the high price volatility, will there be a good reason for consumers to use Carry Protocol’s service, instead of the existing services? Plus, is there any plan to make the price stable?
As explained above, Carry tokens are not provided as loyalty points, since the price of CRE is volatile. We will use Brand Tokens (BT) for stores or brands to provide as loyalty points, without listing on exchange and price volatility. To send Brand Token, service provider should stake Carry tokens (CRE) purchased from the exchange. Therefore, consumers do not need to worry about changes in the value of their loyalty points. The value of one loyalty point is up to stores or brands, which are customized by reflecting their service or product features.
14. Why do you think Carry Protocol is receiving a lot of spotlights?
I think it is because Carry Protocol is expected to make a real-world use case, that consumers can use in their everyday life, in restaurants or in coffee shops. Planning and developing a good service is hard but having real users on the service is much harder, since it can determine the success or failure of the service. Carry Protocol is capable of proving the service to numerous users through the partnerships with Dodo Point, SPC group, and others installed in over 16,000 stores in Korea. I believe Carry Protocol will make a successful case of blockchain service in the real world, and this is maybe why so many people are interested in our project.
15. How does Carry Protocol work in the blockchain ecosystem? Also, what strengths does Carry Protocol have, compared to the other similar projects?
When I first encountered the blockchain, I had too much fantasy about decentralization. However, now I know that it is more important that we adopt blockchain technology to solve the offline market’s problems, rather than focusing on decentralization.
Therefore, our team set the goal as “Making a real use case of blockchain in our daily life” . I know there are many other good projects that have a similar mission with our’s, but our strength is that we already have a lot of knowledge about offline markets through operating Dodo Point. Also, we are working with partners who have good business performances as well as good technological bases.
16. Is there any staking benefits for the tokens I receive as reward? Also, will it be able to swap it into btc or eth from the wallet?
Although it is not written in our whitepaper, we’ve been considering it from the initial stage. We are still thinking about ways to give consumers more benefits when they stake Carry tokens.
For example, when stores or service providers stake Carry tokens (CRE) to issue Brand Tokens (BT), service providers can offer another rewards such as store discount coupons if customers stake CRE tokens instead of them. Let’s say a coffee shop needs to issue Brand Tokens (BT) for customers. If one of their loyal customers stakes Carry tokens (CRE) instead of the coffee shop owner for a certain period of time, the owner may offer VIP coupons for the customer. Also, I think it’s a great idea to swap Carry tokens into BTC or ETH.
17. As a blockchain developer, I have experience of developing a full version of a project, including core, Android wallet, blockchain explorer, ming pool since 3 years ago, even before there weren’t many blockchain adoptions in Korea. What base protocol does Carry use? Also, where can I find the explorer site and mining information? When will you update the source, and what other functions will Carry Protocol provide? Please answer from the technical aspect.
Carry Protocol is reviewing several base protocols. For now, we will use Ethereum for the tokens in ERC-20 type, and operate the actual transactions with a side chain connected to Ethereum. The tx explorer of the side chain and the details of mining will be announced later. You can check out the smart contract of Carry Protocol developed up to now on our official Github page. In addition, we are also considering features such as offline store reviews based on the purchase data, and stable coins that can be used in offline payments.
18. As far as I know, one of the biggest advantages of using Carry Protocol for the store owners is providing additional services based on consumers’ purchase data, such as purchase preference and behavior analysis. What makes Carry better than traditional big data and AI analysis? Also, will you provide customized information to the stores differentiated by the industries or services?
Carry’s key feature is collecting scattered offline purchase data with consumers’ agreement. There are many good data analysis solutions once you have the data. However, it is difficult to collect people’s offline consumption details, so the offline data is scattered and discarded. The research says that 90% of all world’s spending is being used at offline services, but the offline spending data is not properly analyzed. The very first goal of Carry Protocol is to collect the data and to make offline consumer profile, with the purchase details such as shopping, pet, climbing, smoking..etc. After the data collection, we will be able to provide a more customized and accurate consumer data.
19. I believe Carry Protocol is a great project that can be applied to our real life. However, it seems like the target market is mainly in Korea. Do you have any plans for global expansion strategy? If so, which country do you plan to go first?
We will be focusing on making real use cases in Korea first. After making successful use cases domestically, we will be expanding our business to global through the partnerships.
Dodo Point, our core partner, is currently installed in 300 stores in Tokyo, Japan. The number of users in Japan has already recorded over 1 million. Based on Dodo Point’s activities in Japan, we will be expanding our service. Also, we are planning to expand our business to Southeast Asia, to the major cities with high population. For now we are strategically engaging in overseas investments and having discussions weekly to introduce our project to the global networks.
20. What parts of Carry Protocol project are you focusing on recently?
Recently we are focusing on service development. We will move forward the achievement as planned in our roadmap. Also, we are engaging in future partners to enlarge Carry Protocol’s ecosystem. We look at two factors for the partners: 1. A company with many stores and 2. A company that operates B2C app with a large number of users.
21. It seems like the Brand Token issued by merchants has the same features with the existing loyalty point system, just like what Dodo Point is operating right now. Also, considering that the merchants need to understand and accept cryptocurrency, I think Carry Protocol is hard to adopt to our real life compared to the existing Dodo Point. Why would merchants use Carry Protocol instead of Dodo Point?
Actually, it is our key feature, to make it just like the existing loyalty point system. In this way, the merchants won’t need to study and understand the blockchain technologies which some of them never even heard of. We will make the Carry system similar to the existing point system which people may already feel familiar with, so that its transactions will increase rapidly.
22. Carry seems to be sharing a number of Spoqa’s employees, including representatives of Spoqa. I wonder whether Carry and Spoqa are separate corporations or Carry is a subsidiary of Spoqa.
Carry and Spoqa are separate entities which have a tight cooperation structure. Spoka, Dodo Point operator, provides Carry with 10,000 stores, 20 million users, and 150,000 of trade traffic a day. ‘Carry’ performs the task of increasing the utilization value of the data accumulated through Dodo Point.
In addition, ‘Carry’ develops a blockchain application layer and dApp, and ‘Spoqa’ implements a Dodo Point app over Carry’s technology. Therefore, we are working closely in technology and service to both products work together.
23. Spoqa has launched a service called Dodo Point. It seems that Dodo Point is not only providing point service but also POS service and consulting. According to the financial summary information provided by credit-rating agency, sales are increasing, operating profit and net profit seem to be steadily decreasing. Can you tell what kind of revenue sub accounts are included in your sales? Also, does Carry use a sales account? Or a sales revenue account?
Sales of Spoqa has been growing steadily over the past eight years. This is because the cost of using the Dodo Point is steadily increasing as the number of Dodo Point stores increases. The source of sales is mostly the charge of using Dodo Point, and the coupon transfer fee has been steadily growing over the past two years. The other sales are from platform business and advertising revenue.
Carry is not currently generating any profits. The existing corporate structure determines the success and value of the project or business by capturing from the stock, whereas Carry’s value is measured by capturing from the tokens. In addition, to Carry’s own sales and profits, the commission has to be charged every time when Carry is used, and we are not adopting this method because this is the way to convert the value of a project to a stock.
24. The most important thing is Carry’s profit structure. Carry protocol is a centralized service platform although it emphasizes decentralization. The price of Carry is determined by the sales activities of Carry Protocol and Spoqa. In order to sustainably maintain the platform, you need a profit structure to cover the costs. Otherwise, Carry will encounter bankruptcy, due to accumulated losses. There is no specific revenue structure in the white paper except for the use of funds. Do you have a planned capital budget to keep your business running?
We are aiming at decentralization, but it is not our final goal. Carry’s mission is to “return the consumer’s data rights.” To achieve this, someone would have to drive traffic of Carry in the offline market at the very beginning. We expect Dodo Point to do its role. If Carry protocol becomes stable and bigger with more data accumulated backed by Dodo Point, eventually many advertisers will want to use our service. This will lead us to the positive influence on the price of the Carry token. In the future, we will share the success stories of other companies with various stores and Spoqa to invite many entities to our ecosystem. In order to do this, we are recruiting ECA members along with the product development. In the end, we are aiming at the growth of Carry’s ecosystem with many other partner companies together, not only by Spoqa.
In addition, the capital required for the project has already been raised through ICO. We raised enough funds to develop and distribute the service proposed in the white paper.
25. In the case of Carry, the token holders benefit from the efforts of third parties. The Korean capital market law is based on US securities law, according to the interpretation of Article 4 (2) 4, followed by the interpretation of the US(interpreted by Insuk Shim), if the owner of the token benefits from a third party’s efforts, it may be classified as a security token in Howey test. Please share your thoughts on this issue.
Carry Token (CRE) has had Howey Test, evaluated that Carry is a utility token and received a number of attorneys’ comments that there is no trait of security token.
26. Carry protocol vendors are expected to receive a payment license in order to offer Carry token at the payments in offline stores. Companies with utility tokens abroad are actually encouraged to receive payment licenses. Will Carry get a payment license? If you are able to run a business without a payment license, please explain to us with the proof.
Carry Team will run the business legally in accordance with government regulations, and plan to receive payment licenses if necessary.
27. In Korea, there are many other payment services as well as carry. Although Dodo Point has a lot of users, it doesn’t seem to be easy to compete with those outstanding competitors such as Terra, operated by CEO of Ticketmonster(Korean giant e-commerce app) or Danal’s Pay Protocol. In addition, loyalty point services are already integrated into Rakuten, L Point, SSG, etc., and even in most cases, it is possible to change point to cash. The only advantage Carry seem to be rewarding for sharing the consumer data, but the data analysis market in Korea is not mature yet. In this situation, what are the strengths of Carry Protocol?
The biggest difference between Carry and other companies’ projects is that there is no reason for Carry to make revenue. The reason why Rakuten, GS, and SSG are doing point business is simple. It is because they can make profits. Carry has no reason to generate its own profits. That’s because all values are reflected in Carry tokens. Thus, profit-seeking companies will use the consumers’ data to drive the company’s stock value, but Carry will have the value of the Carry project in tokens’ price. Companies use consumer data to make money for shareholders, whereas Carry delivers value to token holders. This is the biggest difference between Carry and traditional companies.
For example, on Facebook, they must always compare the value for users and to the value for shareholders. Therefore, they tend to cause a very inconvenient situation that the user can accept (e.g the recent user data privacy concerns, resulting in a fine of $5 billion ), and will return all value to shareholders.
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Through Pantera ICO Telegram AMA, we have witnessed consistent interest and support for Carry team. We look forward to sharing updates of Carry’s ecosystem and product.
Thank you for continued support!
