A vast majority of crypto projects live in the red area below. Electroneum has created this hybrid cryptocurrency that merges fintech and cryptocurrencies into a unique system that allows for mass adoption.

The Electroneum wallet model is based on a centralized system that is regulated via KYC and AML/CFT. Now that regulation and compliance is in place, Electroneum’s MOU’s that they have in place can roll out without any roadblocks.

Electroneum’s Instant Payment System

As I previously said, Electroneum recently went live with the patent pending Instant Payment System. This system allows users, who are on the centralized wallets, to send payments to each other instantly. These transactions happen instantly off chain and are then confirmed on the blockchain minutes later. This method can look at the ETN balance of the sending and the receiving parties wallet, then transfer the funds instantly to the receiving party and ring fence or lock the portion transacted from the sender’s balance to protect against double spends. It will keep the money ring-fenced on the sender’s wallet until the transactions are confirmed on the blockchain. When you look at this method in the case of a vendor accepting payment from a customer, it allows an instant transaction and the trust level for the vendor to know the ETN will be delivered to his/her account. This vendor can now release the merchandise purchased by the customer straight away, kind of like a credit card transaction, only faster.

Electroneum and Regulation

Now let’s look at the regulated and compliant ecosystem Electroneum is creating: shown in the green area of the top diagram. Below shows a zoomed-in view of the economy details. This diagram shows how the money moves from Fiat, into the ecosystem and back out to Fiat. It also shows how the money exchanges via mobile payments from user to user within the ecosystem.

Electroneum’s Gig Economy

The Gig Economy is going to be a key to the success of Electroneum. I don’t think there has been enough focus put on this area, which I believe is one of the vital components to kick-start the master plan. I have been studying what potential impact this can have on the unbanked and the probability it has to be successful. This amount is far too small of a number to be sent to an exchange to trade for FIAT successfully.

Just look at the stats above on how successful fintech companies have been in these emerging markets. Electroneum will launch a website in Q1 of 2019 a marketplace called GIG.guru; a platform that is very similar to Fiverr. This is a website where users of the western world, or anywhere in the world, can post digital projects or gigs and allow the users from these 3rd world economies to complete jobs for payment in ETN. This will enable the flow of ETN into this economy in addition to the mobile cloud mining payments. The average amount of ETN earned by the mobile miners as per Electroneum is up to $3 a month. This amount is far too small of a number to be sent to an exchange to trade for FIAT, without taking a substantial hit in fees. However, it is a considerable amount for someone who lives in the target market.

Providing an incentive to accumulate a significant amount of cryptocurrency with respect to wage levels and the ability to use it for remittance or mobile payments will provide Electroneum a massive advantage over the standard Fintech companies already in the space. It’s the start of Mobile Payments 2.0.

Electroneum’s Economic Retention

The economics of this system as Electroneum establishes itself as a Fintech provider in the region shows how Electroneum is creating a fully sustainable ecosystem.

I will explain this by using an example based on having 100k users in a region, not a far stretch as Electroneum has about that many users today mobile mining.

A large percentage of ETN earned by users will stay and circulate in the economy as it will be better served to be exchanged for a service or a product sold in ETN versus converting it to FIAT.

Let’s also calculate that 10%-15% of the mobile miner users will engage in the gig economy when they realize the profit potential. From that 10–15% of gig users, let’s estimate that they will receive on average $10–20 a month for doing gigs via this website.

Again, these amounts are too small for an exchange, so they will want to spend the ETN on a vendor that accepts it in the ecosystem to maximize the effectiveness of their balance. As more and more ETN enters the economy, the total amount of ETN circulating in the system will compound monthly. As this number increases, entrepreneurs who will see this ecosystem thriving will try to get involved and get a piece of the action. These entrepreneurs I call agents in my diagram. They can be companies doing gigs, companies buying minutes in bulk from the mobile carriers and then selling prepaid cards of airtime minutes for ETN, general vendors in the neighbourhood who accept ETN via IPS whom all want a piece of the action.

I invite you to do some calculations on what this economy will look like if we had 100k users mobile mining, and 10% of them doing gigs. Calculate a percentage that leaves the ecosystem back into FIAT, and the new money coming in every month. Then fast forward a year and tell me what you see. And while you are doing all of this, let’s also bring the user count up to 200k, 500k, one million and 10 million from 100k. What do you see now? Let that sink in for a second. Remember $3 in Africa, Asia and South America is a lot of money, the target markets for ETN. The larger this ecosystem grows, the more successful it will be, and as it grows, it will grow exponentially.

Not only will Electroneum be helping the economy in Africa and allowing the people of developing nations to increase their income, but they are also letting anyone who has an online store to attract a whole new audience by their API for the IPS.

Electroneum’s API

The API for the Instant Payment System is straightforward to integrate into any application and requires zero knowledge in blockchain development. The API handles everything, and it works at the speed of Instant. It is just as easy to implement ETN into an existing application, as it is to integrate platforms such as PayPal or Stripe into an application. Electroneum is working with several community developers to create IPS integrations for the most popular shopping cart systems including WooCommerce & Magento; used by 35% of the top 1 million sites. These two plugins are already completed in beta form and can be found on GitHub. They are also working to create ETN payment gateways for OpenCart, Omnipay, Drupal, Jigoshop, easydigitaldownloads & more. In the next few weeks when these plugins are released, it will be as easy as installing an ETN payment Plugin into your existing site, entering in your Vendor API keys and you will be live and ready to accept ETN as a payment option.

This will create a massive marketplace that utilizes ETN as a form of Crypto payment.

The API also allows mobile carriers and any corporate partners to integrate ETN into their existing payment platforms easily. Electroneum recently announced that many of their current partners are well underway on integrating Electroneum via the instant payment API and these integrations will be live by Q4 2018.

Electroneum is already KYC/AML compliant, has a released product and a well thought out game plan ready to be marketed and adopted.

So in summary, this is obviously a project to keep an eye on as it starts to make a splash in the crypto world: it is one of the very few projects that is creating a solid path to mass adoption.

Let me know your thoughts.

Article Sources: https://www.centerforfinancialinclusion.org/storage/FI_Hype_vs_Reality_Deconstructing_2017_Findex_Results.pdf

https://www.gsma.com/mobilefordevelopment/wp-content/uploads/2018/05/GSMA_2017_State_of_the_Industry_Report_on_Mobile_Money_Full_Report.pdf

https://www.mckinsey.com/industries/financial-services/our-insights/mobile-money-in-emerging-markets-the-business-case-for-financial-inclusion