Gennady Volchek: blockchain will replace intermediaries and allow manufacturers to work with customers directly
Blockchain has changed the social perception of economy structure. Decentralization, cryptographic data protection, transparency, and other benefits of the technology allow using it to solve problems in finance, trading, logistics, law.
In the interview, Gennady Volchek, CEO of Shping and speaker of Blockchain & Bitcoin Conference Belarus, explains how distributed ledger technologies are changing the shopping industry, the core idea of Shping, and how to earn tokens using the platform.
- Banks of Australia have prohibited customers from buying Bitcoin with payment cards lately. What do you think about such a decision?
- I believe that was a correct step from the side of banks and regulators, as buying Bitcoin and any other cryptocurrency carries definite risks. Banks have the following position: if people are ready to take a risk, they should risk their own resources. Most probably, it will help to secure many people: by taking a loan in a bank, they expect to make a profit, but due to volatility, loan or interest repayment may occur independently of the cryptocurrency market movement, thereby a person may face a very difficult financial situation.
- Please, say some words about the state of the crypto industry in Australia. What attitude do authorities have to blockchain and digital currencies? Can a national cryptocurrency appear in Australia?
- Together with many technologically advanced countries, Australia has a very positive stance on blockchain and cryptocurrencies in general. Of course, the field is getting more regulations to create a more manageable environment for fair business development. It is hard to say whether Australia will create its own cryptocurrency at the national level. In my opinion, any currency (or utility token) should serve some definite purpose, as that is the guarantee of constant demand for it. Australia already has a national currency that solves all assigned tasks, that is why I do not consider reasonable creating another similar currency. Especially as the tasks of the government are primarily aimed at public demand and cryptocurrency is still a niche product.
- Belarus has passed a decree that allows any operations with cryptocurrencies, legalizes mining, and all these things will be exempt from tax. To what extent is such a scheme acceptable and is it possible that other countries will follow the same way?
- Australia has not decided yet how to charge cryptocurrency owners with taxes. There are different suggestions. One option is the payment of taxes while changing the evaluation of all available cryptocurrencies at the beginning and end of the financial year. Another option is to impose taxes on the sums converted into fiat money. Both these models will work poorly if the cryptocurrency is available for settlements, as the obtained income can be spent before the tax declaration is filed.
- At Blockchain & Bitcoin Conference Belarus, you will tell how to protect your brand and attract customers using blockchain. Have you encountered real case studies of using blockchain for this purpose? Can you name the most successful examples?
- For the first time ever Shping platform and app allow brands to get acquainted with their end users, as previously they knew only their distributors and sometimes shops that order goods. Interaction with end users has been beyond reach for them. The reason is that the exchange of data or incentives was impossible. For instance, now an African buyer can scan a product of an Australian manufacturer using Shping app. At the same time, the user can be motivated by the manufacturer, for instance, to watch a video about the product, write a review or make another action rewarded by Shping tokens.
Such micro financial operations are hardly possible without cryptocurrency, as in case the sum of incentive equals to 5 cents, the transaction fee in fiat money would not allow running such an operation, and besides a buyer in Africa might be bankless.
- What does blockchain offer to the shopping industry? How will blockchain-based shopping look like eventually?
- Blockchain gives a possibility to get rid of intermediaries, as a transaction or a deal may be carried out without third parties that ensure the fulfilment of terms. I think that blockchain will replace intermediaries, allow manufacturers to work directly with buyers, resulting in the reduction of prime cost, scaling, and other positive moments.
- How do you assess, how blockchain implementation in the shopping industry will optimize expenditures of businesses in the next decade and will it increase the market volume?
- I find it difficult to make such an assessment and think that figures can range substantially. I don’t know whether the market volume will increase as the purchasing power and customer needs will not change for sure, but manufacturing profits are quite possible to change.
- Do you keep an eye on other projects in the niche? What does Shping stand out for?
- I cannot say that we actively follow other projects, as we have a clear understanding of what we want to attain and how we will come there, but of course, if we meet projects working in the same field, we get acquainted with them. The main thing that differentiates our project from many other in the market is the use of the GS1 standard, which allows us to save the trouble of changing something in the production and marking of goods for the manufacturer and makes Shping integrable almost with any business independently of the industry.
- In your opinion, how much time is needed to turn the blockchain technology into a product ready for use by end users?
- A number of companies already use the blockchain technology, for instance, Everledger, IBM, and of course, Shping. As for the cryptocurrency, I think that mainstream adoption will take place when a legal framework is built and the market becomes more predictable, and when the demand for cryptocurrency is based on its intended use rather than people willing to make money on arbitrage and volatility.
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