Slava Gomzin, Co-Founder of GRAFT

In the previous post we reviewed the similarities between GRAFT and plastic card networks. Now let’s review the differences.

Difference #1 – Decentralization

There is such a key property of GRAFT Network that fundamentally differentiates it from plastic cards. Unfortunately, not all buyers realize and appreciate this property immediately because it is not that obvious to the average consumer, especially in developed countries. And let’s be completely honest with ourselves here – not everyone cares about this property – it’s not until you find yourself in, not before your get into a situation that it suddenly becomes very important. I am talking about decentralization.

The card processing consists of several elements represented by multiple corporations: payment networks (Visa, Mastercard, American Express, etc.), issuing and acquiring banks (such as Chase, Bank of America, etc.), and payment processors (such as First Data, Heartland, etc.). Each corporation has its rules and compliance to national governments, which means they can reject any merchant or buyer, anytime. They can put you out of business, make you “persona non grata” – without any reason, notice, or explanation, just because you don’t fit their requirements – by declining your credit card application, decreasing your credit limit, locking your funds, or cancelling your merchant account. Millions of people live behind the “invisible wall” built by those corporations and governments, without access to banking system, i.e. without ability to use credit/debit cards.

Unlike plastic cards, GRAFT Network does not belong to anyone. GRAFT is more a protocol rather than a product due to its open source nature and peer-to-peer architecture. Therefore, the buyers and merchants cannot be either rejected or approved: they simply connect to the network (by downloading free apps) and start using it, no strings attached. But remember that unlike typical ”bare” cryptocurrencies, the features #1 – 4 from above are still there to satisfy both buyers and merchants standards on the same level as they are satisfied by payment card processors, only without centralization.

Difference #2 – Privacy

Another key difference is somewhat related to #1; however, it is completely separate feature, which is achieved by using special additional technical means rather then just solely based on the fact that GRAFT is independent from corporations and governments. What’s really similar to #1 is the fact that for some people this property may not been important at first glance – again, until you get into specific situation when it does become important. This property is absolute privacy provided by GRAFT Network to both buyer and merchant. Unlike plastic cards and most cryptocurrencies, GRAFT’s sender address, recipient address, transaction amount, and transaction fee amount are invisible to everyone except for the sender and recipient themselves. Although payment card networks do not expose the details of transaction to the public, this data is accessible by employees of multiple corporations, can be shared with governments, and can be stolen by hackers. Unlike plastic cards, no employees or hackers can access GRAFT transaction data which is encrypted forever – thanks to strong cryptography and underlying blockchain’s CryptoNote protocol.

Difference #3 – Security

Security is another thing that differentiate GRAFT Network from plastic cards. I spent years working on security of plastic cards payments . This technology was created in 1960s, and improved in 1990s by introducing EMV – “chip and pin” cards. But back then, even in 1990s, people were not very familiar with terms like “cybersecurity” or “hacker”, so the technology was not designed with security in mind. The result – a multi-million industry called “credit card fraud” that flourishes to this day.

I am not saying cryptocurrencies don’t have security issues at all – everything related to computers and network has potential security issues. However, if you manage your wallets and keys properly, the security of GRAFT for both buyers and merchants is much stronger than plastic cards: no chargebacks, no lost or stolen cards with the primary account number embossed on the face of the card, and no hacked point of sale systems with millions and millions of payment card records stolen and sold on dark market. Difference #4 – Technology

Let’s not forget about technology – payment cards use centralized networks, relational databases, and centrally managed customer and merchant accounts. GRAFT uses decentralized peer-to-peer network, distributed blockchain database, and random wallet addresses which are not linked to customer identities.

GRAFT “inherits” all the positive features of traditional payment card processing networks while offering solutions to negative sides of centralized, insecure, olding technology. Give it a try!