COTI Logo Taken From the official COTI Facebook page
COTI, or the Currency Of The Internet, is one of the latest cryptocurrencies proposing a solution to the problem of easy online mass adoption of crypto as a payment method. The truth is that, right now, there are ways to pay with either fiat or cryptocurrency online but both have their drawbacks. The minds behind COTI have designed their currency to tackle these very specific problems.
Before we get into the broader conversation, I want you to understand I am not a financial advisor and this is not financial advice. Always do your own research. As of this writing, I have both signed up for the COTI airdrop and wallet, and I have been selected (potentially) for their merchant program--initiatives that are designed to increase early adoption of a cryptocurrency. I have no relationship with COTI beyond that, and none of those put me in a position where I can unduly influence them as an entity, nor can I be unduly influenced through those positions.
What's Wrong With Fiat?
As any grandma can tell you, shopping online isn't safe. OK, maybe it isn't that bad, but if you do online shopping, chances are you've developed your own risk/reward threshold. From shopping only at major retailers to filtering all their purchases through a single processor, like PayPal, many shoppers limit their online shopping activity out of a fear of identity theft, fraud, and overcharges. Further, there are billions of unbanked or underbanked people around the world who may be barred from online shopping due to their country's banking restrictions, fees, or unavailability of services.
For merchants, it's all about the profit margin. Payments online are received through payment processors, banks, or services who take a cut to move the customer's money into the vendor's account. This percentage can be well over 10% leading to higher prices or lower margins. Declined transactions also take their toll, and extended settlement periods can leave you with money on the ledger that they have no access to for an extended period of time. Merchants also miss out on business from the billions unable to participate in the online banked economy.
What's Wrong With Crypto?
Cryptocurrencies offer an avenue to online spending for the majority of consumers due to the low bar of entry. With a few bucks, anyone, even in a developing economy, can purchase currency online or locally. FOr many cryptocurrencies, however, a greater familiarity with technology is needed to facilitate transactions through the sending of cryptocurrency to the merchant. In addition, cryptocurrencies are often extremely volatile, leaving the actual exchange rate uncertain while the unregulated nature of most currencies fails to allow recourse to either party should fraud, dissatisfaction, or a wild price swing causing the consumer to overpay occur. High volume currencies could even leave both merchant and consumer waiting extended periods for transaction approval and settlement.
*What Does COTI Do To Change The Payment Paradigm?
For the consumer, COTI promises an easier method of transaction through their payment interface. Rather than a blockchain for payments, COTI uses a directed acyclic graph (DAG) which allows instant payments without waiting for a block. This is combined with the Trustchain consensus protocol which uses an algorithm and a trust score for the users to approve and process the transaction, instilling a level of protection for both buyers and sellers. It's a straight peer-to-peer payment, and the buyer has no need to provide personal information to the seller above that which is required to receive their purchase, such as a shipping address or email account for a digital product.
Merchants benefit from the removal of expensive payment processors, as only a nominal percentage is required to fund the peer-to-peer transfer. This helps protect their profit margins and allows for micropayments. Approval is instant with fewer false declines and faster settlement. COTI has a mediation system that helps buyers and sellers resolve conflicts with a chargeback system meant for equitable treatment of all parties.
Will It Be Enough For Mass Adoption?
Only time will truly tell. COTI's team is packed with industry and tech insiders who have the chops to create a functional product. As I move through the merchant funnel for COTI, I will post some first-hand updates that cover the system from a more educated analysis viewpoint and from a user experience perspective.
If you can't wait to learn more about COTI, check out the links below. Tell me what you think, and if you have a currency you want me to look at, drop it in a comment. As always, if this has been in anyway helpful, please upvote, ReSteem, and share it around.
COTI Website: http://www.coti.io
COTI FaceBook: https://www.facebook.com/COTInetwork
COTI Telegram: https://t.me/COTInetwork