When people think of cryptocurrencies and tokens, the first thing that comes to mind is a reliable means of exchange to replace that dollar you have in your pocket. The problems below, while not unique, may change how you think.
We are currently working with a 2nd tier Big Three supplier that buys about $500k in aluminum alloy every year, and ships at regular intervals to Toluca, Mexico. The aluminum does not have to be DFARS, but does need to be certified. The customer has continuing problems with import material, but the reduced price offsets the amount of scrap material. Things like air pockets, hard spots, and fissures spring up randomly in the metal. Over a 2 year period, the customer tracked yields and confirmed price savings.
After the product is complete, it is shipped to Mexico where the manufactured goods are installed in sub-assemblies, and then shipped back to the United States for final installation.
Exactly 45 days after the initial shipment, the customer is paid by bank wire.
Over the past year, their bank has collected over $5000 in fees, and ‘lost’ the most recent payment in transfer. Numerous emails over the next 4 weeks were just a bunch of finger pointing, and swift code errors. $30,000 is still missing. The supplier is not worried, but inconvenienced.
Now it would seem Bitcoin could solve the problem here, but there are actually two problems and Bitcoin does not offer a solution to either.
Problem #1, suspect material. The customer has created value by evaluating material yields. This documentation has value to many other material buyers, but the customer has no way to incentivize it. Iota can change that. Even if Iota has no purchasing power for the customer, Iota tokens can allow the customer to trade for other valuable data. You can read more about Iota’s partnership with Microsoft, that is working on this now: https://www.cnbc.com/2017/12/04/cryptocurrency-iota-rallies-after-launch-of-data-marketplace.html
Problem #2, is the money transfer. Of course, Bitcoin would work, but the problems is the end users CFO, lawyers, and share holders would never allow a decentralized product to transfer money from customer to supplier. At least not at this stage of adoption. This is where Ripple can step in and offer a safe, fast, and traceable means of exchange that would never lose $30,000.
We recently looked over Iota and Ripple white papers, which can be found here:
We are not computer science engineers, so the papers are a tough read, but it is clear that Iota and Ripple will offer solutions, and value, in the near term that companies are looking for.