I am working on an dapp (private blockchain) wherein users can exchange fiat currency for a token. The token can then be exchanged for particular goods and services, for example: groceries, health, transport, bills and so on. At the outset of the transaction, the sender can opt for the token to be linked to particular good or service. Alternatively, they can create a blank token, and have the sender decide what goods/service to link the token to.

The purpose of the application is to facilitate trust between two parties wherein the sender requires the receiver to spend the funds for a particular purpose. For example, an individual working in Italy can send back a set of tokens (2x grocery, 1x transport, 1x bill) to family back home in South Africa, who can then spend it as requested.

With the above outline in mind, I wanted to ask how an individual token would be valued. Given the nature of the system, it doesn’t seem sensible for the token to be volatile and traded on the open market. Furthermore, given the fact that the token to be consumed within the context of business partners (eg retailers, public transport services and utility companies => who can then exchange it for fiat) all across the world, how do I go about determining the exchange rate of token => goods, services in each country? Also, do any dapps exist which perform this function?


AFAIK no such DApp exists. The reason is because you would have to convince every business of your local community to use tokens and there is still no market for this, nobody uses cryptocurrencies yet for their daily life, like the example of buying groceries you provided, I am not even mentioning about transport. Another point is that every token must be developed for the business that is issuing them, so you would write a contract almost for any business out there, and that's hell of a work. You are also missing some small business operation details, because every working business has its own (computing) System, and there is a price to integrate their System to the blockchain. Now , given that amount of system integration , which is paid at a very high rate in cryptocurrency world, what would the issuers of the tokens gain with your idea?

Your market size is all those people who must be enforced to buy something at some store (because probably they can't be trusted if you ask them to do this) , and how many people is that?

If you want to create a cool idea you must start from solving some problem and the size of the problem + the usefulness of the solution will be equal to your success.

Right now your idea is like hundreds of ICOs out there, trying to make some money on this trend of the rising cryptos. But very far from reality.

  • I think it has been proven with Colu here in Liverpool: bbc.co.uk/news/magazine-40728550. They’ve created a local currency which incentivises people to spend money in local businesses. Their uptake has been good so far, so it proves that there is a desire from businesses to invest in cryptocurrency, given that they can convert the tokens into cash quickly – methuselah Dec 17 '17 at 18:45
  • @methuselah It is a marketing article, to promote their brand. So, Colu has not yet been proven anything. And btw, Colu is not a token, and you said you are going to tokenize goods and services. – Nulik Dec 17 '17 at 19:20

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