The goal of Terra, a South Korea-based stablecoin project aimed at mass adoption, is to become the largest payments network in Asia over the next three years, Terra co-founder Daniel Shin told Cryptonews.com.
Source: iStock / akinbostanci
In order to achieve this goal, Terra, which is supported by the South Korean internet giant Kakao, is concentrating on integrating with new e-commerce partners and thus increasing its transaction volume. Terra plans to attract mainstream users via the mainstream platforms with millions of users in order to enable broad acceptance of Terra’s blockchain technology.
“The ‘build something great and the users will come’ mindset has not done the blockchain industry any good,” Shin said, but “recent user numbers show that Terra’s go-to-market strategy is working.” Because they believe that blockchain technology is useful and must be used, Terra chose an e-commerce alliance from the start that currently includes 25 partners in 10 countries, with a combined annual transaction volume of 25 billion US dollars and 45 million users. All partners agreed to integrate Terra’s blockchain-based payment solution. It is already available on the TMON e-commerce platform founded by Shin and on the IDUS craft marketplace app, while Terra plans to “integrate quickly with all partners”. Local partners include the Baemin grocery delivery app and the Yanolja hospitality app.
In June Terra entered into a partnership with the Korean mobile payment service CHAI, which reached over 240,000 users in the first forty days alone. On July 22nd, Terra achieved a record daily transaction volume of KRW 1 billion (USD 842,000) following a special offer with TMON. Campaign results.
Shin, who is also the founder and former CEO of TicketMonster, Korea’s $ 3.5 billion gross e-commerce platform, notes that Terra’s main competitors are “the world’s Paypals and Alipays.” To be competitive, Shin says they need to present a clear and straightforward value proposition to both ecommerce platforms and users. While platforms typically charge credit card companies and payment gateways a 2% to 3% fee, Shin explains that they have set up their own payment infrastructure to offer lower transaction fees and “help ecommerce partners save millions”. The fee can vary slightly depending on the partner, he says, but Terra promises its ecommerce partners transaction fees that are up to 80% lower than what platforms typically pay.
To clarify, Terra is a stablecoin linked to the Korean won that is listed on CoinOne, GDAC and GOPAX. Terra is also supported by Luna, a mining token listed on Upbit, Bittrex, CoinOne, GDAC and GOPAX. To motivate users to switch to Terra’s payment solution, Terra implemented a protocol that “uses an elastic supply of money to keep prices stable”. When the demand for stablecoin increases, its supply is increased in order to lower the price again in this way generation of seigniorage, which then flows into the financing of consumer discounts and offers a 5% -10% discount on every transaction.
Expansion and Investors
Daniel Shin. Source: terra.money
Terra is also working on geographic expansion. “We have started preparations to roll out our blockchain-based payment service in Singapore and Hong Kong by 2019,” says Shin, and for the next two to three years they are studying markets like Japan, Thailand, Indonesia and Vietnam. Terra has also partnered with the government of Mongolia “to use blockchain to refresh the country’s financial infrastructure and our product is expected to be on the market by the end of the year.”
Terra plans to introduce various financial services beyond payments. They are currently working with NEXO crypto-backed lending solution, which offers loans in 45 fiat currencies in 200 jurisdictions, to bring Terra-denominated loan and savings products to market to create more use cases for the stablecoin, while providing “the ability to” Borrowing for assets rather than selling them would give Terra an incredibly powerful function, ”Shin said.
In addition, Terra is working on offline payments and is in talks with undisclosed convenience stores in Korea and they plan to make an official announcement with their partner in the next few months.
Shin says Terra is always on the lookout for strategic investors, “especially those who have a deep understanding of key markets like Singapore,” where they are planning to expand soon, or those who have “a great e-commerce portfolio”, while recently received strategic investments from “well-known funds such as Kakao Ventures, a subsidiary of Kakao, and LuneX Ventures, the blockchain-focused investment arm of Golden Gate Ventures”. The company is also backed by Binance Labs, Huobi Capital, OKEx, Polychain Capital, and others.
Speaking of regulation, when it comes to crypto, the local government is most concerned about “fraud projects or ‘pump-and-dump” scenarios where individual investors can be exploited, “explains Shin. He added that Terra “is in constant communication with the relevant parties to educate them about blockchain technology and the need for a stable cryptocurrency,” while CHAI is in charge of the necessary licenses and appropriate KYC (Know Your Customer) and AML ( Anti-money laundering) procedure.
Finally, referring to Facebook’s Libra, Shin said, “It’s exciting to see a large company validate the need for a stable price, global digital currency with a specific use case,” and that “more and more projects are going to think seriously about how to do it with blockchain and Bring crypto into the hands of the masses. “
In a recent written testimony to the US Senate Banking Committee, Wyoming Blockchain Coalition co-founder and 22-year-old Wall Street veteran Caitlin Long told lawmakers that “out of date financial regulation” is the development of stablecoins such as Libra. If investors could, she said, they would use the US dollar to trade digital assets.
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