revolutionizing global payments 2018g. enabling etherpay service provider/freelancer with...
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REVOLUTIONIZING GLOBAL PAYMENTS 2018
W H I T E P A P E R
Contents
EXECUTIVE SUMMARY 3
The EtherPay Vision 3
Technological Landscape Overview 3
Payments Industry 4
About EtherPay 6
The EtherPay Solution: A Decentralised Payment Gateway and Marketplace 7
A. A Universal decentralized marketplace on the Ethereum blockchain 7
B. A mobile payments solution to accept Ethereum 7
C. Enabling EtherPay marketplace 7
D. BenefitsofJoiningEtherPayMarketplace 7
E. EtherPay Department 8
F. Enabling EtherPay community power 9
G. EnablingEtherPayserviceprovider/freelancerwithgeolocation 9
Product Comparison Table 11
EtherPayChain 11
EtherPay Wallet 13
EtherPay Card 14
EtherPay POS 15
EtherPayData 16
EXECUTIVE SUMMARY
E-commerce worldwide sales in 2014 were US$ 1.25 trillion and are projected to increase toUS$4trillionby2020.Thee-commerceshareofretailsales isexpectedto increasefrom7.0%in2015to14.0%in2020.Furthermore,thenumberofpeoplebuyinggoodsorservicesonlinewillincreasefromUS$1.3billionin2015toaboveUS$2billionin2020.
Marketplacesalesworldwidewillcontinuetopostsolidgainsin2017,rising23.2%toUS$2.290trillion.By2018,thetotale-commercesaleswillreachone-tenthofthetotalretailmarket sales worldwide.
Retailsaleswillgrow5.8%thisyear,reachingUS$2.737trillion,largelydrivenbysalesinChina.
Worldwideretailsalesofe-commercewilljumpby23.2%andreachUS$2,290trillionorfourfoldcomparedto2017
E-commercesalesgrowthwillstayinthedoubledigitsthroughouttheforecastperiod.
The combined Chinese and US markets in this year's e commerce sales amounted to US$ 1.584trillionrepresenting69.1%oftheworld'se-commercemarket.
In2017,mobilecommercewillaccountformorethan70%ofecommercesalesinbothChinaand Indiaand59.0%inSouthKorea, inGermany, theUnitedKingdomandtheUnitedStatesofAmerica,e-commercewillcompriseat leastone-third of total retaile-commerce sales.
Worldwideretaile-commercesaleswillreachUS$2.290trillionintheend2018,makingup10.1%oftotalretailsales;thissharewillsurpass16%by2021whensaleswillhitUS$4.479 trillion.
Furthermore,thenumberofpeoplebuyinggoodsorservicesonlinewillincreaserapidly.
The EtherPay Vision
Theinventionofcryptoassetsandblockchain-basedcomputinganddatasharinghaveusheredinthenextmajoreraoftheopeninternet.JustasHTTPS,SMTPandSIPallowedfor freeexchangeof information,blockchain technologywill enable individuals toexchangevalueandtransactwithoneanotherinthesameway–instantly,globally,ataverylowcostinasecuredmanner.Anopeninternetofvalueexchangecantransformandintegratethedigitalworld,eventuallyeliminatingartificialeconomicbordersandenablingamoreefficientglobalmarketspacethatconnectseveryone.EtherPaywasbornoutofadesire to realize this vision.
Technological Landscape Overview
EtherPayenableswallet-to-wallet transactionswithinandacrosscurrencies, includingcryptoassetsaswell as fiat assets.EtherPayplans tocreatean implementationofprotocols that are not proprietary but rather an open global public utility. The protocol itselfisimplementation,independentandblockchain-agnostic,notdependentupononeparticularunderlyingblockchain,programminglanguage,operatingsystemorsettlementinfrastructure.
EtherPayplans its implementationof theprotocols tobedeployedontheEthereumnetwork throughEtherPayChain.Theprotocol isdesigned for compatibility acrossmultipleotherDLT technologies and runtimes, andmultiple implementations areexpectedtobecreatedforotherblockchains.TheprotocolsfunctionatanarchitecturallayerontopofEthereum.EtherPaycansupportmanysettlementrails, includingotherblockchains–bothpublicandprivate,andbankrailsincludingtraditionalwireprotocols.Toincreatetransactionalcapacityanddrivelowcosts,EtherPaymakesheavyuseofstatechannels to move value. State channels enable multiple transactions to occur securely andswiftlywithoutpublishingevery individual transactiontoanunderlyingblockchainledger. This mechanism is also viewed as increasing privacy protections. EtherPay also planstoofferaserviceprovidermechanismtosupporttrustandidentitydecisions,rulesforpaymentsettlementandreversals,and thesecureexchangeofKYC/AML-relatedinformationtomeetcomplianceobligations.
Payments Industry
The electronic payment industry has grown increasingly over the last decades due to the growingspreadof internet-basedbankingandshopping.Astheworldadvancesmorewithtechnologydevelopment,wearerisinga rise inelectronicpaymentsystemsandpayment processing devices. As these increase improves and provide ever more secure onlinepaymenttransactionsthepercentageofcashtransactionswilldecrease.
Theworld’sonlinepaymentprocessingmarket isworthapproximatelyUS$20Trillionin2017andisprojectedtogrowtoUS$30Trillion in2020,withthenumberofpeoplebuyinggoodsandservicesincreasingtomorethan2billionin2020,accordingtoareportbyaleadingglobaltechnologyresearchandadvisorycompany.Thelackofcompetitioninthisfieldresultedinanunfavorableplayingfieldforbothbusinessesandconsumersasthey have no choice to take up payment services provided by monopolies such as AliPay orPayPal.Financial institutionsontheotherhand,chargemerchantsbetween2-3%forcreditcardtransactions.Thesecompaniesoftenchargehightransactionfeesandhasanunfairpricingstructure.
Credit Card Transaction
Diagram
ConsumerPay $100
Issuer Acquirer
Switch
MerchantReceives $97.76
Issuer debits consumer
account $100 and pays
$98.20 to Visa
Visa receives $98.20 from issuer and pays
$98.09 to acquirer
Acquirer receives $98.09 from Visa and pays $97.76 to Merchant
Ethereum Transaction
Through EtherPay Diagram
ConsumerPay $100
MerchantReceives $99.12
EtherPay debits $100 from consumer account and pays $99.12 to Merchant
Paymentgatewaysarethefirststepintheonlinepaymentprocess. It plays a vital role in the ecommerce transaction process,authorizingthepaymentbetweenmerchantandcustomer.Withtheincreasepopularityincryptocurrencies,expectationsare for them to replace fiat currenciesaspaymentalternatives.Thedigitalizationofmoneythroughcryptocurrencieswill facilitate a newworldof cheapinstantaneous transactions.
Ethereumhasbecomeapreferredmethodfortransferringwealthtoandfromindividualsandentities. Inthemiddleof 2017, it overtook Bitcoin in the number of dailytransactions. This is because Ethereum can be used as aplatformforothercryptocurrencies,andalsobecauseEthereumtransactionscanbeconfirmedquickerby theblockchain.ItisbuilttobemoreefficientthanBitcoin.
ThenumberofEthereumtransactionshasbeensteadilygrowingover the lastcoupleofyears,and thenumber
of transactionswas fluctuatingaround400,000perdayorapproximately4.5 transactionspersecond.Ethereumhasa largepotential forscalabilityandcantheoreticallyhandle up to 270 transactions per second with its current implementation,whichis24milliontransactionsperday.
However,itisstilltechnicallyimpracticaltosendtokensorcoinsfromaccounttoaccountortopayonlinemerchantsfor goodsor serviceswith the current solutions thatare available on the market. Current desktop wallets expectuserstodownloadtheentireblockchaintoalocalmachine. The user will then be allowed to broadcast his first transaction.Blockchaindatasizesare far fromsmall,theEthereumfullnodesizeisapproximately63gigabytes.Ethereum is not the only option when it comes to cryptocurrencies. Thereareapproximately 900publicblockchainsoperatingworldwide.Eachof theseexpectsuser to downloadgigabytes of data before the firsttransaction can be sent. It is a major barrier that the
blockchaincommunitymustovercomeforcryptocurrenciestobecomewidelyacceptedinsociety.Thefirstsolutionwillbetoprovideawalletthat removesthetechnicalcomplexityofblockchainsandsimplify theprocess forusers to interactwith themforgeneralpurposes,suchassending,receivingandcheckingtheirbalance.
There are many wallets available on the market that provide an impressivesetof functionalities.Allof themcanreceive, transferandstorecryptocurrencies inasecureway,observethecryptomarketandexchange rates, speculateoncryptocurrencyassets.Somecanevenconvertcryptocurrenciesthroughexchanges.However, there isstillnoconvenientoreasytousewalletthat focusesonuserexperience,userinterfaceandstillprovidingauser-friendlywaytotransfer tokensandcoins. Inparticular,this includesseamlesspayments inthee-commerceandin-applicationssectors,whichwouldbeconvenientforbothparties–clientsandbusinesses.