Febin John James's Blog, page 8

Of course, I was talking about the transportation costs when it moves around distributors…

Of course, I was talking about the transportation costs when it moves around distributors, retailers and wholesalers.

Blockchain Will Make You Save Big Money

John owns a chair factory. He makes beautiful chairs. He works continuously on innovating its design. The basic version of his chair costs $50 to manufacture. If you want to buy it, you would have to pay around $400.

Why is that the case?

This is because his chairs move around a lot of people before it reaches you. Each person in the chain takes a cut. This would add to its cost.

Why does it move around people? Can’t John directly sell the chair to his customers?

Easier said than done! Managing manufacturing and sales is a headache for John. Since he only wants to focus on product quality he has outsourced the sales to a distributor. John has to ship his chairs to a distributor. The shipping cost gets added to the chair’s price.

Credits : xkcd

The distributor needs to work out a distributing strategy. They would analyse and find out which wholesalers would give a good price for John’s chairs. Distributor needs to be compensated for his work. This would further add to the chairs price. Yes, the cost of shipping chairs to the wholesaler needs to be considered.

Even a wholesaler wouldn’t sell the chair to the consumer directly. They need to find out which retail shops (like Walmart, Target, etc) are appropriate for placing John’s chairs. They also should be compensated for their work. Again the shipping costs of sending the chairs to the retailer should be considered. The retailer will sell the product to the consumer. He needs to be compensated for selling the product.

Let us list the costs

Manufacturing cost - $50John’s shipping cost to the distributor - $20

2. Distributor’s compensation - $100

3. Distributor’s shipping cost to the wholesaler - $20

4. Wholesaler’s compensation - $100

5. Wholesaler’s shipping cost to the retailer - $20

6. Retailer’s compensation - $40

Total - $350

How should the costs be?

Manufacturing cost — $50John’s Profit - $10Shipping cost to the customer - $20

Total - $80

Credits : xkcd

That’s a big difference around 4x higher. Around $270 is eaten by the middleman. In some cases, the difference is 10x higher.

How do we bring down the cost?

For you to buy the chair at $80, we need to connect you with John directly. This alone won’t solve the issue. John would need a minimum number of orders. So that he can produce in bulk and be profitable. In other words, we need a platform that can connect buyers who are interested in the same product with a manufacturer. If the minimum number of buyers are reached, the platform would alert the manufacturer. The manufacturer would then build and ship products to the customers.

There is another problem. This would require the buyer and the manufacturer to trust the platform. This infrastructure cost of the platform increases product’s price. There are chances of fraud. The manufacturer can take the payment and not deliver or deliver poor products. We need a platform which is self-maintained so that it doesn’t add to the costs. The important thing is we need to solve the problem of trust.

Credits : xkcd

How do we solve the problem of trust?

Have we solved this problem elsewhere? In this situation, we need to take care of the listed things.

Protect buyer’s money (only if the product is delivered the money should be released to John).Give assurance to John (Once minimum amount of buyers are reached, they can’t cancel the order)

These are condition based triggers. Consider the last time you purchased an ebook from Amazon. Amazon will only deliver it once the payment is confirmed.

Computer programs execute such instructions consistently. It did when you clicked on this article, scrolled down, etc. In order to help John and you, we need to convert the agreements of the contract into code.

Pseudo code of the smart contract between buyers and John

If the customer placed an order then Lock $80 on customer's account
If minimum amount of buyers reached and date is 30th June 2018 then Alert John to start manufacturing chairs Else Release customer's money
If the chair is delivered to the customer then Transfer $80 from customer's account to John's account

But where do we deploy this code? If we follow the traditional method, we have to deploy this code on one centralised computer. This can’t be trusted because the person who owns the computer can alter it. Instead, we need to deploy this code on computers or phones of buyers and manufacturers. We can also deploy this code on a public blockchain like Ethereum. Basically, it would be on multiple computers so that one person can’t monopolise (Decentralisation). The important benefit being the platform is self-maintained and the infrastructure cost is drastically reduced. This is what blockchain is about.

Now, when the customer places an order, the order amount would be locked. He won’t be charged. The manufacturer can set a deadline to reach a minimum number of buyers. If the buyers are not reached until that time, then the money is released back. Once the buyers are reached, John can start manufacturing the chairs. Once he delivers the chair to the customer, the code will execute and the locked funds from customer’s account is sent to John.

John is happy because he has an assurance that he would be paid if he does a good job. The customer is happy because they can be assured they are only charged once they receive the product. Basically, both the parties don’t have to trust each other.

Credits : xkcd

Cartel is building something similar. Take a look at this video.

https://medium.com/media/005cdccd83286fb43ce9bb5e023550b3/href

Cartel connects buyers around the world with the manufacturer. Collectively pooling their individual orders into one large wholesale quantity price. They eliminate the middleman discussed earlier in this story like Distributor, Wholesaler, Retailer, etc. They even give protection to buyers using smart contracts. The cost they add to the transaction is as less as 3%. A range rover which costs around $150,000 would only cost around $80,000 on Cartel. This would disrupt the retail industry by reducing the product prices drastically. They are now open for an early bird ICO registration.

Claps Please

5 Promising ICOs You Need to Know

Photo by Graeme Nicholl on Unsplash

Did you know that trillions of our hard earned dollars are wasted every year paying retail? You pay a price 10x higher than the manufacturing cost. Your money is eaten by the middlemen (Distributors, Wholesalers, and retailers). Can we make products cheaper by eliminating the middlemen?

Cartel

Cartel connects buyers around the world with the manufacturer. Manufacturers can list their products in Cartel. Once they find enough buyers for the product. Cartel collectively pools individual orders into one large wholesale quantity price. The manufacturer is then requested to build the product in bulk. Once the manufacturer ships the product, he gets paid. This would eliminate the middleman.

This innovation reduces shipping costs. Hence contributes to making the world a better place by drastically reducing CO2 emissions. Cartel gives protection to buyers using smart contracts. This feature eliminates fraud. The cost Cartel adds to the transaction is as less as 3%. A range rover which costs around $150,000 would only cost around $80,000 on Cartel. They would disrupt the retail industry by reducing the product prices drastically. They are now open for an early bird ICO registration.

https://medium.com/media/005cdccd83286fb43ce9bb5e023550b3/hrefCredits : xkcd

Mark is a sports writer. His new employer pays him in Dash. He is a non-techie. He somehow managed to create a crypto wallet and received his first payment. But, he is worried about its security since his friend’s wallet was recently hacked. What can he do?

Giza

Giza wants to solve Mark’s problem. They provide an easy to use secure hardware wallet which supports currencies like Bitcoin, Ethereum, Bitcoin Cash, DASH, Litecoin, Ripple, Stratis, Zcash, etc.

You can even use the wallet on a compromised computer. This is because you need to physically confirm the transaction on the wallet’s screen. A hacker who works remotely wouldn’t be able to withdraw from your wallet. Giza device is not just a secure hardware wallet. It also has a password manager and a secure digital storage of 16GB.

https://medium.com/media/2ea3f4af82d1e234ca59dfd854bd34f8/href

DDOS attacks are carried out by flooding the bandwidth of a target system. Even an unskilled hacker can easily launch a DDOS attack. Though there are several services which filter out such requests, it remains inefficient.

Gladius

Miners earn bitcoins for renting their computers. Likewise, people can rent their computers to Gladius. Those who rent their computing power are compensated in Gladius coins. Now, the requests are distributed to the decentralised system of computers around the world. They would filter the good request form the bad. This increases efficiency by drastically reducing cost.

https://medium.com/media/ccab6ae303a0fa27686cd755bbdbe9c8/hrefCredits : xkcd

Native video advertising is effective. But, launching a large-scale ad campaign is time-consuming. Since the process requires negotiating with relevant bloggers. Monitoring if the requirements are met is a lot of manual work. It’s almost impossible to verify.

AdHive

AdHive is based on Ethereum smart contracts. Advertisers can configure the campaign and reserve the budget by buying ADH tokens. AdHive’s AI takes the heavy lifting. It sends the campaign to relevant influencers. Once the ad is placed, AdHive’s AI will keep a tab on the content to check if ad requirements are met. If the requirements are met, then the influencers are paid in ADH tokens.

https://medium.com/media/45cf1dcea4330b1c0fcaf78984851aab/href

John is a computer scientist. He writes two books every year. He cannot focus on writing and marketing. Hence he has partnered with a publisher (middleman) to market and distribute his books. The publisher takes a huge chunk of his revenue.

Gilgamesh

The basic problem which blockchain solves is eliminating the middleman. Gilgamesh is a blockchain platform which eliminates the middleman and connects readers, writers, service providers and critics directly. Once the author publishes his book, the critics review to receive Gilgamesh coins.

Readers who follow critics would buy the book directly from the author. Service providers can use API’s to build services that could benefit readers, authors or critics. They get paid in tokens when someone uses their service. Since the platform is decentralised, the infrastructure cost will be minimal.

https://medium.com/media/33c5a074bfe1121922d8740783ffbea7/href

Claps Please

https://www.quora.com/What-would-happ...

https://www.quora.com/What-would-happen-if-a-bank-runs-out-of-all-of-their-money

Bank can pay the money, he will owe the bank

Bank can pay the money, he will owe the bank

6 Promising Blockchain Opportunities You Need to Know

Business Opportunities on Blockchain1. EdTech Startups

I explored a lot of Blockchain courses in Udemy, Blockgeeks, etc. Some of these courses are good. But, there is a room for improvement. It can be made much simpler, interesting and engaging. I recently came across CryptoZombies. It teaches you to write a smart contract by building a game. It was on top of HackerNews. There is a good demand for such platforms. I would recommend you to read the book The Innovator’s Dilemma.

CryptoZombiesLearn Blockchains by Building OneHow does blockchain really work? I built an app to show you.2. Blogs

There are a lot of articles with jargons about Blockchain, but stories are less. There is a good audience who is looking for simplified explanations. Since it’s an emerging market a lot of ideas are still to be imagined. You can write about Blockchain by thinking about its use cases in different industries. Eg. How will Blockchain impact the health industry? or the education industry? You can also write by combining ideas from different fields. Made to Stick is a great book that can help you explain topics simply in an understandable way.

WTF is The Blockchain?We already know blockchain’s killer apps3. Idea Validation

You have a startup idea. You know it works when you put it out on the market with a basic version of the product (MVP). Only when people pay you money you can be sure. Typically starting to accept payments can be difficult. You need to register a company, complete the legal process, etc. Cryptocurrencies help you prevent such hassles. You can create a wallet, set up the API and start accepting payments in no time.

4. Solutions for Non-Techies

It’s difficult for non-techies to use blockchain themselves. Startups like Coinbase are addressing this market. There are potential in ideas which can help non-techies take advantage of Blockchain solutions like generating a smart contract, managing ICO funding, etc. I was exploring ICO turnkey solutions, most of them are expensive. You have to raise a seed round to afford such solutions. An affordable solution is definitely a need.

5. Non Profit

The biggest problem the Blockchain solves is that it eliminates the middleman. Producers get reasonable revenue for the work. In India middleman has exploited the agriculture industry. Non-Profits are trying to use the Blockchain to connect consumers and farmers directly on the Blockchain. Find an industry you are familiar which is exploited by a middleman. Experiment ways you can use Blockchain to eliminate them. There you go, you have an idea for a non-profit.

Ethereum is one of the biggest social enterprises on the Blockchain. They have created a platform which can benefit programmers, entrepreneurs, social entrepreneurs, miners, etc.

Investors can fund the Non-Profits with the help of a smart-contract. This means if only certain milestones are achieved the funding will be released. This will make Non-Profits more responsible for the work they do. Blockchain also increases transparency to the system. You can find out who exactly benefits from your donation on the Blockchain.

Ethereum Project

6. Raising Funds

It has been never easier to raise investments for your idea. The biggest problem ICOs solved is anyone anywhere could be an investor. You don’t have to go through the tedious process or generate a certain amount of revenue to be eligible. Scamsters has taken advantage of these. In the future probably there would be some mechanism to prevent fraud. If you have an idea. investment wouldn’t be your biggest hurdle. You just need to convey the idea to the right people to help you raise investments. Entrepreneurs usually have these skills in their blood. Claps Please

Differences

Differences

Smart contract are like the normal contracts with the power of automated execution . They can have one or more terms to be satisfied.Smart Contracts are decentralised, the code doesn’t lie in a single computer owned by one entity.Hence, A single entity can no way monopolise and manipulate the terms in that contract.

If someone doesn’t have the money, the bank can pay for them and they will owe the bank.

There are multiple blocks and one chain

There are multiple blocks and one chain

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