Web3 Loyalty Program is a Trojan Horse for Good Policy[Column]| coindesk JAPAN | Coindesk Japan

It is said in the legal world that “bad facts make bad laws”. Crypto assets need good facts right now. For cryptocurrencies to gain empathy among policy makers, they should not highlight facts and stories that threaten governments and wealthy people (“No fiat currency!” ).

Instead, it should emphasize simple, valuable, consumer-oriented, everyday stories. It should be technology that benefits everyone and strengthens communities without violating individual rights. Strange as it may seem, the most obvious example of this is the Web3 loyalty program (a point system and other incentives to attract loyal customers).

Benefits of the Web3 Loyalty Program

The Web3 loyalty program offers a number of advantages over traditional loyalty programs. But the ones that resonate most with policymakers are ownership, control, and interoperability.

For Web3-based loyalty programs, users can truly own their points, membership status and brand-related NFTs — in the form of “loyalty tokens.” Users can also move, trade and sell their tokens. And in a way that the brand deems appropriate.

This means that companies can restrict the movement of their loyalty tokens, giving them fine-grained control over how their loyalty program operates and who participates. Brands can choose which wallets receive their tokens according to their stated requirements.

This helps indicate that Web3 Loyalty Tokens are not securities. It is not always possible to trade for profit. Consumer goods.

Easy interoperability

Another advantage of the Web3 loyalty program is that brands can achieve program interoperability. Loyalty tokens can thus be earned and redeemed by any brand that wants to participate in a particular program.

However, while examples of interoperability already exist, they are limited due to Web2 technology and collaboration is manual and time consuming. In other words, brand A has to sign agreements with brand B and go through expensive system integrations to collaborate.

Under the Web3 Loyalty Program, collaborations can be partially or completely permissionless, depending on the brand’s wishes, and participating brands can partner with other participating brands.

In other words, brands with similar customer bases and non-competitive products and services can promote each other and leverage each other’s brand value with little or no upfront coordination. become.

For example, a restaurant can offer a limited-time discount to Gold members on a product by users presenting their NFT, which is proof of their Gold membership.

“Trojan horse” for dissemination

If the Web3 loyalty program is successful, it will bring new users into cryptocurrency in a familiar way and have a positive impact on the industry as a whole.

First, through various incentives, you can experience crypto assets and blockchain technology at low risk. Nothing is more straightforward and effective than offering real-world benefits (such as discounts at your favorite shops) to get the average user familiar with your wallet.

The Web3 Loyalty Program makes it even easier for people to understand and use the technology by making wallets more ubiquitous and encouraging them to use blockchain-based tools in an understandable way with clear benefits.

Additionally, the Web3 loyalty program can demonstrate the value of blockchain technology in the real world. These programs are not trying to revolutionize the world, but rather enhance already established programs by adding benefits that can only be realized with blockchain technology.

Good stories make good policies

If regulators and the public think about crypto through the Web3 loyalty program, the whole crypto industry will benefit because the regulatory framework already exists.

Loyalty programs operate within well-established laws and regulations. It also includes consumer protection and privacy standards. There are fewer outstanding issues governing the Web3 loyalty program and less need for new legislation.

The Web3 loyalty program is “not a threat.” Unlike DeFi (decentralized finance) and other crypto use cases, it does not threaten the power of the state or the traditional financial system. It does not harm the consumer economically. This makes the Web3 loyalty program more politically acceptable and easier to regulate.

The Web3 loyalty program is also good for businesses. It provides businesses with valuable tools for competing, collaborating and attracting customers. We can’t crack down on tools that are commonly understood to be “good for business.”

If the story of the Web3 loyalty program is widely accepted, ordinary users will feel more comfortable and familiar with Web3 technology. As users realize the power of owning and controlling the Web3 loyalty program, they will become more supportive of crypto policies that benefit the entire industry.

Mr. Josh Rosenblatt: Co-founder and COO of Co:Create, a blockchain-based loyalty program.

｜Translation and editing: Akiko Yamaguchi, Takayuki Masuda
｜Image: Shutterstock
｜Original: Web3 Loyalty Programs Are a Trojan Horse for Good Crypto Policy