Eric Benz Talks Crypto with Alexander Busarov, CEO of TaelPay
Changelly has recently listed Tael (WABI), making the token available for instant purchases and fast crypto swaps to over 150 cryptocurrencies. With the help of blockchain technology, the Tael ecosystem aims to protect both brands and consumers from counterfeit products, thus creating a secure marketplace with authentic goods.
Tael’s token is a loyalty token that consumers receive for purchasing goods, verifying the authenticity of products, and participating in events. The token is already used as a payment method by over 60,000 people.
Changelly CEO, Eric Benz, talked to Tael CEO and co-founder, Alexander Busarov, to learn more about the name behind the token, the dual blockchain system and what makes WABI different from other tokens on the crypto market.
Eric: Hello, nice to meet you, and thanks for agreeing to this interview. Now, before we delve into the topic of crypto, could you tell us a little bit about yourself? How did you enter the blockchain industry/crypto market?
Alex: My pleasure. In terms of education, I studied Philosophy and Economics at the London School of Economics which is where I met my co-founder Yaz Belinskiy. After I graduated, I worked at McKinsey as a management consultant for 4 years. I then worked as Sales Director at a major infant formula producer, gaining a deep understanding of the FMCG (fast-moving consumer goods) industry.
Our intro to the blockchain industry came as we believe it is the key to solving a complex problem: how to protect consumers from counterfeit products. Blockchain is a vital part of our solution to this problem but blockchain in and of itself isn’t enough, which is where our high-tech labels and the other parts of our ecosystem come in. The use of crypto loyalty points (Wabi) also allows us to run an incentivization scheme that ensures the consumers we protect are also contributing to our ecosystem, and are rewarded for it.
Eric: Why did you decide to call your emerging token Tael? After all, WaBi already was a household name by that point.
Alex: Tael derives its name from Chinese history, where a Tael was a unit of weight and an old form of money. Not only does this name represent the ways that our loyalty points/tokens are used, it’s also appealing to consumers in China who will be able to immediately identify the function by name alone. For our dedicated crypto fanbase we’ve retained the name WABI as the designation for the cryptocurrency outside of China.
Eric: How did the idea of Tael come to you and what is your vision for it, in addition to being a loyalty token?
Alex: The name makes a lot of sense in terms of both the China context and our intended use of the token. Our vision is to build an ecosystem in which consumers are protected from the risks of fake products, and brands are protected from fraudulent competition. Tael is the perfect medium of exchange for this as the form of payment within the ecosystem and a key building block underpinning the safety of all ecosystem participants.
Eric: With Wabi being a loyalty token, its growth is limited by the growth of the whole Taeltech ecosystem. Wouldn’t that hinder the expansion of your token?
Alex: Not at all. We have very ambitious growth plans and we don’t opt for strategies that will “limit” our growth. The ecosystem is seeing huge opportunity for growth, both in our current anti-counterfeiting business model and new business models that we are exploring, so there is no limit on the growth of the token either.
To put it in perspective, we’ve already got tens of thousands of ‘consumer users’ who hold our tokens and transact with them every day. You can see the exact number at adoption.taelpay.com which is updated daily.
Tael being a loyalty token allows us to build a new, more effective type of loyalty point system for our Chinese consumers which means we can provide them with great user experience whilst also protecting them from fake goods. This incentive system, in turn, allows us to generate much richer data insights for our partner companies.
One of the most exciting developments coming in the ecosystem in the coming weeks will be to do with exactly this – providing rich, effective data insights for FMCG companies that sell in China.
We already have tens of thousands of consumers holding our tokens and using them to transact every day.
Eric: There are thousands of tokens already available, with more appearing almost on a daily basis. What makes Tael different from the other tokens that we have on the market right now?
Alex: To put it simply: we actually have users. Almost no other token has the real user base that we do – instead of just traders or stakers, who have no bearing on how that project can create real business value, we have real consumers using our marketplace and completing transactions with our tokens every day (adoption.taelpay.com).
We also have a real, proven use-case. Other token projects build protocols and then try and find a use-case for their idea. We took a different approach – using an effective existing protocol as the basis for our technology so that we could get into market as quickly as possible.
This paid off – we’ve been building our consumer users for about a year now and, excepting the recent blip due to the virus shutting down trade, we’ve grown massively each and every month since.
Eric: So, how does Tael work: how can people earn their Taels, is there a limit to the amount one can get, and how can Taels be used?
Alex: Due to the dual blockchain system we run, we have two distinct types of token holders.
For ‘crypto holders’, who hold or trade our ERC20 token ($WABI), they can purchase the token on exchanges. To earn WABI, they can run a Masternode (currently they would need to join the queue), or by completing activities on the WABI Academy and other community events we run.
On the other hand, ‘non-crypto holders’ are consumers earning our token through their regular purchasing, browsing or reviewing habits in the Tael ecosystem. This token is on a separate Hyperledger Fabric blockchain and is called shijifen.
For example, ‘Lucy’ buys some Nestle NAN A2 milk powder for her baby from our Taeltech marketplace. She earns a 5% rebate on her purchase and she receives this in Wabi points (Shijifen). She earns more tokens for scanning the Taeltech label protecting her package after the milk powder is delivered to her apartment, and then gets a final reward for submitting a review for Nestle’s product.
Shijifen tokens are also purchased by our partner companies to spend on marketing activity in the ecosystem.
There’s no limit to the amount of tokens either group can have.
Eric: Your company is based in China, as is your target audience. What do you see in the immediate future of Tael? Are you planning to expand it beyond China and beyond its usage as a loyalty token?
Alex: Whilst our consumer-facing business is focused on China for now, the expansion of Tael has already spread around the world to Japan, Europe, New Zealand, and Australia with partners like Rakuten, NZ Cherry Corp., and more.
Currently, we’re in the middle of a new expansion into some of the largest department stores in Asia. You can find out more about this here
But let me give you a brief rundown…
Department stores in and around Asia get a huge amount of foot traffic from Chinese consumers, our target audience, when they travel. As well as adding Tael protection to products sold in-store, we also develop a ‘safe channel’ for these department stores on the marketplace. Through this channel we make the department store’s products available beyond just their physical locations to the more than 500 cities in China that we serve. As such, these tourists return home and can continue to make purchases of their favourite products from the department store, as well as browse the items they didn’t get to see, with all products verifiable authentic thanks to Tael technology.
We’re also working on making Tael tokens an accepted payment option in the department stores themselves for when our consumers are shopping in-store.
We’ve also recently launched multiple big brand partnerships that have expanded the categories we protect, both online and offline. For example, we recently partnered with the New Zealand Cherry Corp., one of the largest and best cherry growers in the world! We’re very proud to protect their world-class fruit as they journey to China and get devoured by consumers here.
Eric: Have you encountered any legal difficulties operating within China? The legal structure around cryptocurrencies is quite complex.
Alex: Our dual token structure allowed us to manage the legal environment in China. As I mentioned, we run two blockchains with two different tokens, linked 1:1 with one another.
– Tael / Wabi is an ERC-20 token tradable outside of China.
– Tael loyalty point / Shijifen is a loyalty point based on Hyperledger blockchain and used in the Tael ecosystem within China.
Shijifen cannot be traded on exchanges by consumers, along with other restrictions similar to most loyalty programs: they are not transferable to other users and cannot be exchanged for fiat. Basically, Shijifen is not a cryptocurrency, but a blockchain loyalty point.
This is one of key elements of our tokenomics: the 1:1 link between crypto token and loyalty point means that with each Shijifen awarded to a consumer, an equal amount of Tael / Wabi is taken out of ERC-20 circulation and locked. You can take a look at our adoption page for current statistics.
More consumers means more of the circulating supply of Tael / Wabi gets locked up – the token is naturally deflationary. By way of example, as of April 9, 2020, more than 46,800 consumers with registered accounts in China hold an average of 51 tokens each. This means that 46,800*51 = 2,386,800 tokens are already locked out of supply.
This is almost 2.4% of the total token supply and this number continues to grow.
Eric: With the current situation on the crypto market being unstable, how do you think the current price dump will progress? What business and revenue model is in place to ensure the Tael ecosystem is both sustainable and profitable??
Alex: The current dump will result in projects who have been relying on artificially inflated token prices to survive finally dying. As I’ve said previously, as the tide goes out we will see who has been swimming naked. This happens in every nascent industry and will result in a better allocation of resources and capital to projects that prove themselves strong enough to survive, thanks to their teams and business models.
For us, we’ve got a great, proven use case. Our marketplace is used daily by thousands of consumers purchasing protected products. The rapid growth in our consumer users is tangible proof of the value they place in being able to buy goods without fear of tampering or counterfeiting. This proof is reinforced by the very high interaction rates we see with our labels after consumers receive their products.
We’re also constantly exploring new avenues for development and there are some very exciting things on the horizon in this regard – we’re building a new service arm of the ecosystem that aims to fundamentally change the way that FMCG companies can engage with their consumers and make informed strategy decisions.
Eric: You partnered with Rakuten a while ago. How has the relationship with them progressed and are there any upcoming announcements or partnerships in the pipeline for Tael?
Alex: Our partnership with Rakuten has been fantastic. Towards the end of last year, we went through another huge expansion with them – adding over 200 new product lines to the marketplace. This is testament to their belief in our solution and the success we have seen so far in helping them reach the tens of thousands of consumers in our ecosystem.
There’s lots coming up and we like to keep our community up to date with everything that’s going on in the Tael Ecosystem. This means that as soon as we can announce developments, we do; so the best place to keep up to date with what’s going is via Twitter or on our blog.
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