Winning the payment scenario of tens of millions of users, Terra set off a new battle for stable currency

Text | Editor M Jun | Bi Tongtong Source | PANews

From the emergence of a new pattern of stablecoins in the market in the second half of the year, to the advent of Libra this year, it once again aroused the attention of cryptopunks to the payment scene. Competitive payment, if liquidity and users are the decisive factors in the game, then in addition to acting as a trading medium on exchanges, stablecoins that can develop more consumer-oriented usage and payment scenarios are likely to break through.

At the site of the Korea Blockchain Week series of events, PANews found that the name of the stablecoin Terra was often mentioned. Its co-founder Do Kwon even announced four cooperations in a row during the event speech. The stablecoin that has attracted great attention since its creation last year, Terra may set off a new battle for stablecoins in the global user payment scenario.

4 cooperations will cover more than 3 million merchants

"From the front end, Terra provides the same user experience as other mainstream payment tools, but Terra solves many challenges for merchants behind the scenes." On the afternoon of October 1, Do Kwon gave a speech at the D.FINE conference of Korea Blockchain Week Shi introduced that from complex payment and clearing procedures to a single blockchain layer, Terra has improved merchant settlement time from 3-16 days to 6 seconds, and reduced transaction fees from 3% to 0.5%-1.3%.

Do Kwon also said, "CHAI, Terra's mobile payment dApp, aims to generate $1 billion in annual revenue, making Terra the most active blockchain project in the world." 4 collaborations.

First of all, Terra’s mobile payment dApp CHAI was officially launched on South Korea’s largest hotel platform, Yanolja. The platform includes more than 400,000 hotels in 210 countries around the world, with tens of millions of users, and an annual online turnover of 2 billion US dollars.

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Terra co-founder Do Kwon

The third cooperation is that CHAI will cooperate with CU, the largest convenience store chain in South Korea, at the end of 2019 to launch offline payment. CHAI payment can be used in more than 14,000 convenience stores of CU in South Korea.

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From left: Youngjoon Choi, vice chairman of TMON, Mun-hwan Lee, CEO of BC Card, Daniel Shin, co-founder of Terra, Changjoon Han, CEO of CHAI

Terra is actively bringing together global e-commerce partners to join its ecology, and is constantly improving the application of the blockchain payment system in the global e-commerce system. Its development model is somewhat similar to Alipay and PayPal, using e-commerce platforms, The payment system can obtain the user traffic of the parent platforms Taobao and eBay.

Terra received widespread attention when it was launched last year. Another co-founder, Daniel Shin, is the founder and CEO of TMON, a Korean e-commerce giant with 30 million users. The investment institution can be described as a "luxury lineup".

Four of the world's six largest digital currency trading platforms have invested in Terra, including Binance, Huobi, OKEx, and Dunamu & Partners, the parent company of South Korea's leading exchange Upbit. At the same time, Terra has also received investment from leading institutions Polychain, Arrington XRP Capital, Hashed, Kakao Ventures, and many other institutions. And in August this year, it received the investment from HashKey Capital, a subsidiary of HashKey Group, a strategic partner of Wanxiang Blockchain Lab.

In the difficult C-end payment battle, can Terra win with blockchain technology and fast-moving cooperation?

Algorithm-regulated dual-token stablecoin

In the wave of emerging stablecoins last year, algorithm-adjusted stablecoins, with their complete independence and no dependence on external credit, have become the most eye-catching category, and Terra is the representative of this category.

Terra adopts the form of decentralized cryptocurrency collateral and consists of two tokens, namely Terra and Luna, which can also be said to be stable coins and utility tokens. In reality, the central banks of various countries generally maintain reserves by holding gold or foreign currencies to keep their currencies stable. The Terra system achieves this function through Luna, another digital currency issued by it.

When a Terra-based transaction occurs, the system will forward a transaction fee to the user who pledged Luna. As the value of Terra increases, the value of Luna will also increase. As long as transactions occur in the Terra ecosystem, Luna holders can be rewarded. This feature gives Luna non-speculative value support, allowing Luna to provide guarantees for the Terra economic system.

The value of a currency is actually the ratio of it to the currency, that is, the purchasing power. However, the price difference between countries is not small. The ideal situation is that the exchange rate between the digital currency and the currency of each country remains unchanged. This is of course impossible, so the US dollar occupies a strong position in the world. It seems to be the best choice, but in recent years, the dollar has also fluctuated violently, and its purchasing power has not always been stable.

So Terra chose a package of currency strategies similar to the International Monetary Fund (IMF) Special Drawing Rights (SDR), anchoring the world's mainstream currencies, such as the US dollar, euro, renminbi, Japanese yen, British pound, Korean won, and IMF SDR.

In this way, its flagship product TerraSDR was born, and transaction fees, mining income, and various incentives are all represented by TerraSDR. Of course, in actual operation, they can be exchanged at any time according to the real-time exchange rate.

Terra's white paper shows that more fiat currencies will be added to its ecosystem in the future to ensure that Terra can be used for cross-border transfers and international trade payments.

Launch dApp CHAI to make mobile payment

Terra mainly uses fees and discounts to make efforts at both ends of product supply and consumer users, so as to promote more people to be willing to use it as a means of payment.

The motivation for merchants to use Terra comes from lower transaction fees. Accepting Terra payment means that there is no need for the complex value chain system in the past, thus reducing the handling fee from the traditional 2%-3% to a minimum of 0.5%. The means to attract end users is to get a 5%-10% discount for each transaction. These discounts come from more seigniorage due to the growth of the Terra stablecoin itself.

After the mainnet went live in April, Terra soon released CHAI, a blockchain-based mobile payment dApp. The app was launched on TMON, the largest e-commerce company in South Korea, and has accumulated more than 430,000 users in less than 3 months. It also ranks fourth in the financial category of the Apple App Store, and ranks 13th in Google Play. Surpassed KakaoPay, the leader of Korean electronic payment.

Whether it is Terra itself or the entire blockchain industry, the successful launch of CHAI is a big win. Using CHAI, a few simple clicks to checkout brings a user experience far superior to the previous complex password system. At the same time, Terra's blockchain technology makes possible low transaction fees and continuous discounts, all of which not only bring The rapid growth of the number of users has also made most mainstream banks in South Korea willing to join it.

Relying on CHAI, Terra is becoming a leader in the combination of blockchain and mainstream business.

The best landing application in the blockchain industry?

At present, it seems that Terra should be the first stablecoin that guarantees solvency through a stable reserve composed of decentralized assets. The currency value stability under this mechanism is neither controlled by a centralized authority, nor can it withstand the attacks of speculators.

Terra has also launched an e-commerce alliance. Currently, its cooperative merchants are located in Southeast Asia, China Taiwan, China Hong Kong, Australia and other major markets, such as TMON, the largest group buying website in Korea, as well as Woowa Brothers, Qoo10, Carousell, Pomelo and TIKI. At present, Terra has more than 25 cooperative companies, and their total annual transaction volume exceeds 50 billion US dollars.

For example, Woowa Brothers is equivalent to Ele.me in China; Yanolja is the largest entertainment and tourism platform in South Korea; Qoo10 operates 7 shopping website platforms in Japan, Singapore, Malaysia, Indonesia, Hong Kong, South Korea R&D Center, China and other countries; Carousell has long occupied the first place in the shopping list in Singapore; Pomelo is a Thai fashion e-commerce platform led by JD.com; TIKI is the fastest growing e-commerce company in the Asia-Pacific region, serving major markets such as Southeast Asia, Taiwan, Hong Kong, and Australia; There are also well-known Korean music platform Bugs and so on.

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Some partners of Terra

From "Korea runs on Terra" to "The world runs on Terra", Terra's plan is also ambitious enough to cover the entire South Korea in the online and offline payment fields, and expand to 200 countries in the future with 4 million branches.

As the world becomes more and more decentralized, whether it is the real world or the blockchain industry, there is a huge demand for cryptocurrency with stable prices. Terra will also have a huge application space as a medium of exchange for online payments, perhaps in In the near future, it will have a huge impact and become the best landing application in the blockchain industry.