This open source Region Token is a program whereby municipalities and companies can issue their own tokens (points).
By storing (defining) processing rules of tokens in a blockchain without needing to build a dedicated server for managing tokens and employing an administrator, it is possible to issue tokens and register shops as point service participants on the blockchain.
By using this open source program, it becomes possible to utilize a token – for regional revitalization – as a “regional point” that can limit the scope of use to affiliated stores participating in local communities such as municipalities and shopping districts.
The overall structure is as follows.
Usage concept of “Regional Points” issued by with Region Token
Municipalities and shopping districts (point manager)
- Municipalities and shopping districts (point manager)
- Register merchants that wish to participate in regional points as "affiliated stores" and give the merchant the authority to give and receive points for payment.
- Erase points debit of merchant (replenishment) by the amount of payment (payment) from the merchant.
- Apply to the municipality etc. for membership registration.
- Points are awarded to user accounts according to actions such as visits, purchases, etc.
- When accepting a point payment, transfer (replenish) the points used from the point account of the user to that of the merchant.
- For the amount awarded as points, the merchant points debit is erased (replenished) by paying to the municipalities, etc.
- Automatically generate an account in the device by downloading a smartphone application etc.
- Receive / use points by holding a smartphone at a merchant's cashier.
- Confirm the points held in account with an application, specific site, etc.
Advantages of a Blockchain Based Solution
Usually for enterprises to operate their own point service, it is necessary to build highly dedicated servers that can withstand complicated processing necessary for construction and operation of point systems, point distribution management, and maintenance. Also, contractor services are usually required. However, if commissioned to such contractor services, in addition to the costs of server and database, various operational costs are incurred, including labor costs, management costs, etc.
The Region Token which is made open source at this time is a token program which runs on the Ethereum environment. By using this program, municipalities and enterprises can easily issue and operate tokens that act as points that can be used within merchant's affiliated stores. On the blockchain, since process is automated according to prescribed open logic, it is possible to construct an autonomous and permanent point system that incurs only the recording processing cost.
Compliant with token standard specification ERC20
This open source program conforms to the token standard specification ERC20 advocated by Ethereum.
Therefore, any token newly issued in this original token management system can be handled at an exchange constructed by the exchange construction system Token Trader.
Common Issues with blockchains that this service resolves
It is unnecessary for the users to hold cryptocurrency (Ether)
In the blockchain, payment of expenses by virtual currency (Ether) is required every time some processing (recording) is done on the blockchain. However, it is not yet common for users and merchants to own and manage virtual currencies.
Since the service provider (such as municipality and shopping district in this case) can prepay the cost of recording in the blockchain collectively in US Dollar, the user, the merchant and the municipality may freely use the point system without having to pay each time in virtual currency.