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Application of Blockchain in the Online Gaming Industry

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According to a report from China Audio and Video Association (GPC) and CNG New Game Research (Gamma Data), the number of players of Chinese games reached 626 million in 2018. Total online gaming market revenue reached ¥214.44 billion,accounting for 23.6% of the global gaming market. With the development of the Internet and increasing penetration of various electronic devices, the global gaming market still stands room for growth. However, the conventional game model is facing an increasingly deep separation but the rise of blockchain will completely reorganize the space.

Traditional games rely on centralized server operations and storage mechanisms, and below are the pain points of the model:

  1. The value is opaque and the rules are changed arbitrarily, which can cause distrust among users.
  2. Channels and distribution revenues are monopolized by giants while high-quality niche games are difficult to produce, with high development costs and low success rates.
  3. Players’ experience is affected by the fact that virtual assets do not belong to them and they cannot smoothly realize value circulation.
  4. Due to inflation within the gaming ecology, player’sinterests are not guaranteed, early users amass a large number of game coins, equipment depreciation in the middle and late stages of the game.
  5. In-game assets cannot be circulated between different games, which means that when the life cycle of a game ends, all the points are cleared, and the benefits of players are reduced.

The birth of Blockchain, Let the pain point of the traditional game have a solution and return the initiative of the game to the player user.

The code for blockchain games is written in a smart contract and runs on the blockchain, meaning the game chain is transparent and cannot be falsified. It greatly improves the traditional game rules and numerical opacity, black-box operation and other issues, making the game fair and trustworthy. In addition,the transparency of the game source code allows the gaming can still be running without existence of the gaming company. Game players rise from a passive unequal position to a position where players have the right to choose and communicate with the game developer at an equal position. The player rises from a passively accepted unequal position to the player’s ability to actively choose and engage in equal dialogue with the game developer.

Blockchain can help build communities around games and extend the life cycle of certain games.In the traditional game mode, the innovation relies entirely on the developer itself, and there are very few online games that continue to develop a copy and gameplay that satisfy the players. Due to the existence of blockchain and Token economic incentives, the community can use the game editor to innovate new gameplay or checkpoints according to their own needs. This entails the game’s main world in order to retain players’ interest. Decentraland, a game that is similar to the Oasis game in the “Ready Player One” movie, is a classic example of gaming communization, sub-globalization and UGC.

Virtualassets are issued through the asset issuance function of blockchain. The game coins, props and other items in the game become similar to real-life assets.Each virtual asset can be reduced to a unique token and stored in the encrypted blockchain account address of the player. The asset storage is safe, reliable,and ownership belongs to the game user. The virtual assets stored in the blockchain can also be traded in a trusted environment in the form of smart contracts, and all transaction history can be stored, traced and viewed. We take a Dapp game which is driven by virtual asset transaction mode as an example. According to Rare Bits data, the number of transactions occurring within 7 days of the encrypted cat Dapp is 2,614, and the transaction volume is about 100 ETH. The monthly flow is about USD 200,000, which is equivalent to more than CNY 1,000,000.

Due to the cross-application ledger feature of blockchain, the same IP asset can be reused and the games can be interconnected. The blockchain itself becomes a material library that can be called by developers at any time.

The blockchain solves the problems of lack of incentives, trust and in termediatecosts in the Internet, and pushes the community and consensus to the center. Thoug hblockchain can empower the video game industry from various angles, we still have not the wider application and promotion of blockchain games at present.Nevertheless, the industry has good development prospects.

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Application and value of blockchain in energy

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LawrenceOrsini, founder of LO3 Energy, the first-ever blockchain application project in energy, said, “Bitcoin has changed finance to a large extent, but blockchain applications in the energy sector may play a bigger role.”

“EnergyBlockchain”, an innovative application of blockchain technology in the energy sector, allows the energy system to be fully decentralized, providing infrastructure for complex networks in payments, sales, transactions and value distribution, especially in the power network. Blockchain technology has shown strong application potential. In addition to performing energy supply transactions,blockchain technology can also provide the basis for metering, billing and settlement processes. In recent years, technology investments in the energy blockchain have also been very active.

Energy Blockchain has three major advantages:

1. Simplification of multi-layer systems

Energy supply contracts can be transferred directly between producers and consumers,while multi-layer structures such as intermediate power producers, distribution system operators, transmission system operators and suppliers can be skipped by information sharing through blockchain.

USenergy blockchain company, LO3 Energy, has formed a joint venture with Siemens Digital Grid and blockchain operator ConsenSys to establish a blockchain-based micro grid project to achieve peer-to-peer power trading between community residents. If a household has excess electricity, it can access smart meter sand sell excess power to community neighbors. Due to the automation nature of blockchain, almost no management personnel are involved in this entire process.

2. Automatic control of energy network

Smart contracts can automatically send information to the system, formulate trading rules, ensure automatic control of energy and storage flow. They can also greatly enhance supply and demand flexibility of the energy network, and effectively achieve supply and demand balance without complex manual operations.

Electron,a company based in UK, uses blockchain technology to provide flexible adjustments to power supply of the grid. This enables real-time transactions,allows consumers to adjust energy consumption habits in the form of transaction compensation and suppliers can respond to real-time price signals.

3. Safely record energy flow

Blockchain can safely and permanently store all energy transaction data, prevent tampering and losses, and realize data precision and visualization. In addition, blockchain can automatically complete the issuance and trading of renewable energy certificates (REC certificates) based on actual power generation. Real-time recording also makes real-time monitoring possible. Once a match is detected,equipment maintenance and related expense payments can be followed up with immediately.

IdeoCoLab, a leading design consultancy globally, has integrated its functions with Nasdaq’s LINQ platform and Filament’s hardware, and use blockchain to realize power generation based renewable energy certificates (REC certificates). This allows small power generation organizations to access easy tracking,certification and trading of electricity.

The emergence of energy blockchain has many potential implications for the future of the energy industry. For example, the industry’s entry barriers will be reduced, and the sale of over-produced electricity will be easier. For small power producers, blockchain would enable easy data recording, tracking, and trading functions. The functions of incumbent trading institutions and trading notaries may shrink.

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What is the development potential of blockchain in the e-sports industry?

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With the development of financial technology, the changes have gone beyond the financial services industry with its impact having accelerated the development of Internet of Things (IoT). Among them, the impact of blockchain technology can be said to be modern, bringing disruptions to various industries. The development of the blockchain has been named by the World Economic Forum (WEF) in Switzerland as one of the potential technologies to drive the “fourth industrial revolution.” In the face of the rapid development of the blockchain and international trends, policy orientation has brought opportunities for the blockchain, and it has been applied in a wide range of scenarios, including the e-sports industry.

Jplay – The first decentralized e-sportsplatform in the world

Jplay For the first dynamometers this year,Public publication of ExternalHeWe are about to launch a centric video game through the core technology of blockchain. Players around the world will be able to share and build the play electric ecosystem together. And in Blockchain dispersion, fast transaction validation, high transparency and user authorization under the characteristics of each user will be able to enjoy the purest Electric bidding Experience, and freely engage in any video game related applications and creations to achieve a central gameplay experience.

JPlay was first publicly announced in September this year, and they are about to launch an e-sports game centered on the core technology of blockchain. Players around the world will soon be able to share and build a play e-sports ecosystem. With the feature of blockchain dispersion, fast transaction verification, high transparency and user authorization, each user will be able to enjoy the purest e-sports experience and freely perform any game-related applications and creations to achieve decentralization. Play experience.

In the end how blockchain affects the electric competition industry?

Blockchain anti-traditional characteristics, so that the electric competition industry has a transformative development. These widely used traits, driven in some ways, may further drive the electricity industry:

Transparent and open cash flow

Past gamers can only sell limited treasures or tickets through the sale of events Bring, but then put the revenue into the bonus pool. But in the absence of transparency,Under the operating model, players can only fully believe the data published by the manufacturer. and Blockchain through smart contracts, whether they receive bonuses from players or sponsors、Tickets、Sponsorship payments and other income, these cash flows can be clearly demonstrated, but also unable to delay payments, all cash flow needs to be carried out in real time. The high transparency of blockchain smart contracts can further improve the existing mode of operation of the electric competition industry.

Fake Bao Trading

Through the blockchain to send virtual treasure on the platform to compete to win the players, virtual treasure can be replaced through the blockchain system into real currency. Firstblood is A good example, when the virtual treasure and cash hanging relationship, will be able to attract more playHome. Terrible Over theb lockchain to send the virtual Treasure Reward platform to participate in the winning players, virtual treasure can be again through the fun coin (JPT)Switch to French currency, let the virtual treasure and real assets hang up the relationship. and Fans are able to play with the coin when the electric campaign opens a live game (JPT)Sponsor support for your favorite electric campaigner or team, through smart contracts to set a reasonable splitting to the team or broker, anti-traditional changes will certainly attract the vast number of fans in the world of electric competition. For the characteristics of blockchain so that these past only familiar with the insider to know the information, cash flow to become clear and transparent, the electric competition industry chain of every stakeholder will have the opportunity to obtain a fair profit distribution,and in the incentive mechanism to drive attention, will provide greater development potential to the electric competition industry.

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Influence of Blockchain Technology in the Insurance Industry

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Blockchain has rapidly penetrated into the insurance industry, affecting insurance companies’ risk control, reinsurance, policy claims trace ability and other aspects. The technology optimizes processes,improves efficiency and accuracy and adds new impetus to the insurance industry. Specifically, blockchain has the following key applications:

Blockchain Application Model at ZhongAn Technology

  1. Data storage

The carrier of the policy is usually a paper contract as the insurance involves consumers, intermediaries, insurers,re insurers. In the process of policy information tracking and claim settlement,information loss, content misreading, long processing time and other issue soften occur. Decentralized record sharing through blockchain technology can solve these problems. The storage of encrypted, digitized information helps different parties to obtain information more efficiently. The digital management,tracking, and insurance of physical assets through blockchain plus the application of smart contracts and public ledgers in property and casualty insurance are particularly important.

Allianz Insurance, one of Europe’s largest insurers, has launched a blockchain model to store and update information such as policy payments, claims records, which can be verified through blockchain. The Chief Underwriting Officer at Allianz, Richard boyd said: “By replacing the human interventions which are currently embedded throughout the entire risk transfer process, frictional delays and the risks of human error are completely removed – with a radical effect on the speed and efficiency of the process”.

  • Shared ledger of industry data

In property insurance, when multiple consumers file claims that involve multiple insurance companies with different claims systems, smart contracts can automatically confirm their respective coverage areas and scope of protection according to different company system sand calculate the responsibility that should be shared by all parties, which improves efficiency and accuracy. In health insurance, patients usually consult more than one doctor or visit a number of hospitals, which results in scattered medical records for the same patient in different medical institutions. The gathering of insurance companies corresponding medical institutions, duplication of information, errors, and redundancy in the transfer of information lead to inefficiency, high cost, and high error rate. Blockchain technology can establish an industry-wide synchronized information database. Data sharing can be ensured under the premise of ensuring information security by controlling medical data management rights and information access rights.

As an example, the MedRec system designed by Gem Health and the Massachusetts Institute of Technology (MIT) is a medical records and services management system built using blockchain technology.

  • Risk control and fraud identification

In traditional insurance processes,information asymmetry along with complex and cumbersome written claims process gives fraudsters the opportunity to claim compensation from multiple insurers for the same incurred loss. Through the distributed ledgers on blockchain,insurance transactions and claim records can be permanently stored and shared instantly to relevant parties. The ownership mechanism established by digital certificates can also avoid identity forgery. Online transactions can also prevent insurance agents from collecting premiums through private sales orders without reporting to the company. More transparent and secured information disclosure can help prevent and identify fraud while the security of information can also be guaranteed by controlling access rights.

Everledger (a global emerging technology enterprise), created a distributed ledger using blockchain technology to record diamond ownership and provide services to buyers, seller sand insurance companies. After Everledger digitizes diamonds, digital fingerprints are engraved on the diamond and stored in the distributed ledgers.By verifying the digital fingerprints of each diamond, it is possible to identify frauds that some jewelers falsely claim that the diamond was stolen to make a claim, forge a certificate and sell it as a new diamond.

  • Reinsurance

Limited by manual processes and one-time contracts, the communication between the reinsurance company and the original insurance company is inefficient, especially temporary reinsurance. Through real-time data sharing, re insurers can quickly process each claim according to the terms and conditions, avoiding cumbersome file movements during the claim.

Allianz Insurance Company has partnered with Nephila in the development of blockchain smart contracts to assist the reinsurance business. “Automation replaces countless mail exchange sand massive data file exchanges”, said Yann Krattiger, principal at Allianz Risk Transfer.When the processing efficiency of the latter stage of insurance company is improved, the reinsurance industry can save 5 to 10 billions of US dollars. Users would get better services and experiences, and even enjoy price reductions in insurance products.

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Blockchain is the underlying technology for smart logistics

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In 2018, the Tmall 11/11 Global Shopping Festival turnover reached RMB 213.5 billion, a new record once again. In order to deliver as per the turnover, there is a massive demand for logistics services.In the era of online shopping, logistics demand from shoppers is on the rise.Although many top e-commerce and logistics companies are already highly automated. But for automation to reach a stage of precise logistics chain, it requires plenty of big data analysis and blockchain is the underlying technology for such analysis to take place.

Using smart analysis in business flow, logistic sand other information, the analyzed data can be used for demand forecasting,warehousing network and so on. The mainland e-commerce giant Jing dong (JD.com)uses data to make predictions, which can be used to understand the needs of consumers in advance and carry out pre-storage and inventory stocking. When demand can be forecasted, the logistics process will become easier to handle.As a result, the peak period will not appear to be “busy and chaotic”.

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At present, the technology behind drones, robot sand automation is quite mature. In many logistics companies, automation has been widely applied in various logistics links such as warehousing,transportation, distribution and terminals. The shuttle developed by JD.com has a top speed of six meters per second under no-load conditions and can be quickly shuttled between warehouses. In recent years, the 3D technology that arises in civilian use has also been used by JD.com. JD’s delta robots are equipped with a 3D vision system that can identify required goods from the totes and then use the suction cups to transfer the goods to the totes. There is not much need for human intervention in these large e-commerce companies’warehouses.

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When investing in a new technology, a company would be concerned with the relevant costs and benefits. According to the China Intelligent Logistics Development Report from Deloitte’s China Logistics and Transportation Team in 2016, Amazon deployed more than 30,000 Kiva robots inits 13 logistics centers around the world. Because of the effectiveness arising from the robots, each order on Amazon saved an hour’s time, from the time of stocking to delivery from the previous 90 minutes to 15 minutes at present. This allowed Amazon to save up to $900 million annually.

However,in order for the drones and robots to accurately carry out the logistics process, blockchain technology is needed to provide a database for analysis.Otherwise, automation is only a way for reduction in manual labor. Blockchain technology provides the base for the mechanical engineering technology.

After building a powerful blockchain database, it can be further applied to the Internet of Things (IoTs) and artificial intelligence. At present, IoTs mainly have the following four logistics application scenarios:

  1. Product traceability

At present, the level of consumer awareness is very high, and the product is often traced back from source. For example, agricultural products can be traced back to all the information from farm planting to transportation and delivery,including the farming conditions on the farm at that time, fertilizer usage, as well as the temperature during transportation, etc.

  • Cold chain control

For some products, such as red wine, controlling the temperature during transportation is essential. By combining blockchain with IoTs, the temperature control device inside the vehicle can help with monitoring to ensure product quality during transportation.

  • Safe transportation

Long-distance drivers are easily fatigued, and accidents often occur. Through blockchain technology, data of drivers and vehicle status can be collected through installed equipment. Situations such as fatigue driving, vehicle overload and over speed can be detected in advance to prevent problems and accidents.

  • Route optimization

Using blockchain technology, the information collecting equipment installed on vehicles would store information such as road conditions, weather, etc. and transportation could be optimized through analysis.

The application of blockchain in logistics is far more than this. Its essence lies in collecting useful information in order to help us make advanced predictions, conduct intelligent analysis and optimize procedures/operations.

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Application of Blockchain in Personal Health Data

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Large amount of medical-related data was originally stored in hospital database. This traditional, concentrated storage method is extremely vulnerable to losses, amendments and hacking.According to the US health and services data, in 2015, medical-related records were hacked and destroyed for 112 million times. Blockchain features, such as anonymity and decentralization, can help to not only secure patients’ privacy and data, but also to save and share these personal health data in real time.

Before the blockchain was applied in this field, there were two large-scale accidents of data disclosure.Anthem disclosed records of 80 million patients and employees, while UCLA Health disclosed records of 4.5 million patients

People pay more and more attention to medical care. Meanwhile, controversies are also increasing. The use of blockchain technology to construct electronic medical records and disease data solves the cons of traditional platforms, such as lack of standards and vulnerability to hackers. In the recent two years, more and more medical projects have applied the technology of blockchain.

AliHealth cooperated with Changzhou for the “Medical Link + Blockchain” (医联体+区块链) project, which applies blockchain as the underlying technical system to achieve secure and controllable data interconnection between medical institutions. The project helped to solve information isolation and data security problems that have long disturbed medical institutions.

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Based on the blockchain platform of Bubi and Belink, Sunshine Insurance, Ciming Health Checkup Group and Sunshine Union Hospital collaborated to launch the first blockchain platform that authorizes medical staff to view patients’ health records in China. This innovation breaks through the barriers of the traditional platforms and build an efficient and reliable personal health data sharing network, allowing multiple organizations to share clients’ medical reports legally, securely and conveniently to better serve their clients.

Application of blockchain in personal health data:

1.      Blockchain can prevent data disclosure through private key management and encryption. When data is stored in the blockchain, data can only be authorized to assess when the required multiple signatures are provided. This technology sets strict rules for access of data. It must be authorized to proceed, no matter you are doctors, nurses, or patients themselves. The access can be set in a way that it is only allowed when 2 of the 3 people have authorized to access.

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2.   Time stamp is used to ensure data accuracy after data is encrypted and written into the blockchain. Records and data that are written cannot be changed at all. It can only be used or read with permission and cannot be copied. This advantage of the blockchain avoids medical data fraud and records tampering. The accuracy and uniqueness of the medical data is guaranteed, allowing patients to receive post-treatment more efficiently.

3. Blockchain technology enables complex management of multiple private keys. Through a “smart contract”, you can set up multiple private keys for each individual information and set rules for the access of data. People who need to access the data must obtain the private key authorization. The blockchain technology ensures the personal sensitive data is used within the network under control and legitimacy.

4.  Blockchain can provide personal authorization for health data. When customers need to provide health certificates, they can authorize third parties to check the reliability of health data online. They can prove that they are healthy online without going to hospitals or medical centers. Clients do not need to repeat the physical examination for different events, such as qualification test, bank credit application and insurance purchase. Under the blockchain environment, the personal health data authorization helps with the sharing of health data. This not only reduces the economic burden and the waste of resources, but also improves the efficiency of the institutions.During the authorization process, the client’s primitive data will not be disclosed to third parties and leave the data location. Blockchain is open,transparent, traceable, and could not be tampered. This ensure data authenticity and user privacy and eliminate the risk of inappropriate use of data.

In the future, there will be more projects focusing on personal health data. The use of blockchain technology can make the medical market a more standardized, healthier and more reasonable one. Ultimately, it will reduce the credit risk of the medical industry and improve the patients’ treatments.

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The Limitless Possibilities of Blockchain and Sharing Economy

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With the explosive growth of shared bikes and online car-hailing, our lives have been filled with unique products from the concept of sharing economy. The essence of a shared economy is the connection between a sharing party that owns idle items and a user who has a need to use them. Currently,sharing economy requires a third-party intermediary as a platform to connect the two sides. Blockchain technology can help realize the point-to-point connection between the sharing party and the user, which truly decentralizes sharing. In addition, blockchain can ensure the transparency and security of information, while the credibility of participants in sharing economy platforms can also be enhanced. “Green Mining” and other new models can lead to more users, thus building a better ecosystem.

Decentralized Sharing

Blockchain can digitize idle items, data and other resources and store it on the smart contract books, directly to the demand side.This is achieved through the exchange of information between two parties,signing of smart contracts, recording of contracts and transactions, the formation of a shared economic bottom structure, the realization of instant data exchange and trading. In addition, users can measure and trade the value of these resources by encrypting token mechanism or implementing a token incentive mechanism to attract more users and partners.

In a value exchange network based on blockchain technology,information is highly symmetrical. Data capturing, transmission, synchronization etc. can be easily updated and quickly released on blockchain. Even small transactions can be achieved. Smart contracts and tokens also help to ensure the implementation of a mutual agreement between two parties. With the example of a decentralized platform – BeeToken, participants can freely price their offerings without passively following the terms and conditions of Uber and other intermediaries. One of the great benefits of sharing economy’s underlying architecture is its openness. Once the underlying network is built, any product can be implemented with the same process logic so as to achieve “sharing”. From physical goods like cars and apartments to virtual items including electricity,computing power, flow and storage to data like real-time traffic conditions,intelligent weather, all of it can be shared in real time through blockchain to all participants and transactions can be completed through the blockchain value exchange network.

Trust and Security

Blockchain can collect and record user activities and behaviors to construct a full range of user credit files, which realizes the pattern of symbiosis between users and platforms. Users have the ownership of trust and they can authorize sharing of credit data, for which they will receive a corresponding return.

The high degree of information symmetry makes cooperation more secure and each user has the right to obtain the credit history of the opposite party. If a party defaults, it will be recorded on blockchain where records are open, transparent and cannot be modified. As a result, counter party risk is greatly reduced and trading behavior will also be more secure.

More Interactions

In addition to the main operating models of sharing economy, blockchain and the sharing economy can have more ways to interact, such as “Green mining”. For instance, GSENetwork (Blockchain sharing economy company) and Ofo (bicycle sharing company) have created a new model – “Cycling coins, Green mining”. It has been successfully piloted in Singapore and Japan. When an Ofo user rides a bike, the bike stores part of the kinetic energy produced for mining and would feedback some of the value created by the mining process to the user. New models of green mining can attract more users and induce more powerful growth of sharing economy to join the ecosystem. This could improve resource utilization, create value for users and achieve a win-win situation.

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GSENetwork: DApp provides a strong and robust distributed architecture support for sharing economy models on the Internet

More and more companies are exploring the possibilities of blockchain and sharing economy. For example, Beetoken and SnagRide are attempting to become Airbnb and Uber in the blockchain industry respectively. Another company, KeepGo, is committed to sharing mobile and cellular data across carriers. Smart share is exploring opportunities for sharing Internet of Thing (IoTs). Share Ring provides a platform for aggregating all sharing activities.

The sharing economy in the past looked more of a “leasing economy”. But sharing economy with blockchain can achieve truly convenient and open sharing, bring economic returns to all sharing contributors, lower down costs and important, provide better quality services for users. As the Head of Operations at GSENetwork – James Zhang has said, “We are creating blockchain-based, transparent and secured network of sharing economy platforms.If we can do so successfully, then we will change the world.”

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Messaging Platform Giants Lead the Virtual Currency

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This year, messaging platform Telegram launched its own virtual currency to drive its Telegram Open Network (TON). The role and principle of TON is similar to that of Ethereum. There are many applications in TON, including general apps,services and even stores. Telegram can even be used for money transfers. The company’s crypto currency fundraising round raised $1.7 billion in the pre-sale phase, making it the most attractive crypto currency so far for the year.

According to Bloomberg, social networking giant Facebook is conducting research and development of virtual currency, which is expected to be used for money transfer through one of its largest messaging apps – WhatsApp. To prevent dramatic price volatility, Facebook would consider pegging its virtual currency to the Us dollar.

General social activities including dining out with friends will inevitably require some level of split payments. If you have experience in using payment apps such as PayMe and WeChat Pay, you will find that these payment services are bundled with social networking platforms to form a payment circle between friends. The combination of messaging platform and payment tools is indeed a smart fit.

The two major messaging platform giants Telegram and Facebook not only manage to utilize the overlapping features of payments between friends and social circles, but also to create scenarios of adopting their own virtual currencies. This would mean opening up the economic circle in order to create additional capital chains for themselves.

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Blockchain Application in the Music Industry

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In 2018, HMV, a UK-based music and film retailer,announced the wind up of its Hong Kong outlets. Some people are dismayed by theclosure, yet the falling trend of buying discs from physical stores is no surprise to HMV’s failure.

In recent years, many consumers choose to stream or purchase music and other entertainment services online. KKFARM, the investment company of Taiwan’s famous music streaming provider – KKBOX, has joined hands with Bitmark and CTBCBank to release blockchain-based music distribution platform – Soundscape, withan aim of solving copyright issues. Multinational giant Sony has also announced the use of copyright management system two months ago to protect creative content through blockchain.

The characteristics of music industry and the adoption of blockchain

Producers are at the core of the music industry.Producers earn profits through production and licensing of the produced music.Although music is widely considered as an art, there is a need for financial returns to support music producers in the commercial market.

From a legal perspective, music copyright is the basis of music production and profit distribution. From the birth of a song to its launch in the commercial market, there are many ‘rights’ holders, including composers,lyricists, post-production professionals and more. Each party has different contributions, resulting in tremendous complexity in licensing and profit sharing.

 If the costs involved in the process can be reduced significantly, music creators can retain more benefits and will have greater incentive to produce high quality content. Blockchain technology matches the implementation of music copyrights authorization in the following ways:

1. Authorization channel

The musician gives the authorization to the user and receives a fee in return. This process seems simple, but it is not the case in the music industry. As mentioned above, participants in the industry include creators(songwriters, music producers, independent musicians), property right owners (lyricists,music companies, investors), and property rights agents (music copyright companies, recording agent distribution company), users (digital music platform, audio and video production units, music event organizers, etc.),copyright holders (performers, creators), developers (application service providers, system development core team), centralized management group (record production collective management bodies, music production collective management bodies), competent authority (Intelligent Property Bureau, Ministry of Culture,Audio-visual and Music Industry Development Bureau) and so on.

The relationship between people involved in the relevant music rights is complicated, and each time the authorization needs to be approved by the rights holders. When each song or album is legally authorized, the network of authorization and profit sharing in the entire music industry is very complicated while the process is time consuming and cumbersome.

If it involves transnational authorization, the situation is even more complicated. If the music producer authorizes foreign music copyright companies to use their music, profit distribution would be difficult, particularly when the copyright is dispersed, and law enforcement in the two places is not uniform. When a user wants to get music authorized, it is difficult to find out the authorize in a prompt manner. At present, the industry standard for doing so is to firstly entrust the authorization fund. After the right holder is determined, the expenses are settled to the counter party to avoid legal problems.

2. Industry source transparency

In the industry chain of music sales, they need to go through record companies, distributes,copyright companies, music collection groups, digital music platforms, and finally to users. The stacked structure makes it difficult to realize transparency. The complicated profit-sharing process is costly, inefficient and does not directly benefit the producers at source.

By using blockchain technology, people can realize disinter mediation and reduce costs,so that music producers, that is, producers at the source of the industry, realize higher returns. Producers can get more production-related rewards, and all the data in the chain is open and transparent. Also, the benefits and profit can be automatically executed, while maintaining the trust between parties involved.

Blockchain application in the music industry

1.Fair distribution of income

The subscription fee on KKBOX is 149 yuan per month. It is very likely that the monthly fee paid by consumers is for the purpose of only listening to the top ten tracks on the leader board. It is also possible that the customer does not even play the songs on leader board at all as the entire income distribution is based on general direction on the platform. By enabling blockchain technology on music streaming platforms, customers who pay a monthly fee would be transacting through authorized smart contracts. At the time of monthly payments,the smart contract would enable distribution to the songs that you listened to.Customers can therefore support music creators directly for each track that they listen to and/or download.

2. Strengthen distribution ledger

Both the issuing company and music streaming platform would have their own ledgers,which will record transactions of both parties. Most companies currently though use a separate SQL database, or just use spreadsheets and folders to manage authorization on computers.

As the number of transactions grow, the current bookkeeping model would be extremely labor-intensive and time-consuming for processing all the transactions.If music data is directly recorded on blockchain and files are stored on a distributed platform for users to access, it will become easy for the same account book to record multi-party authorization, data submission, report verification, profit sharing etc. When all distributed nodes in the blockchain network have the same distributed ledger, only one transaction action needed is to update books of all users in the network, which can help many firms save cost sand time.

3. Creation through authorized value

Musician sat present need music companies to provide brokerage, publicity, and job opportunities. The issuing company still needs to provide authorization and assistance. When blockchain enters the industry, the intermediary’s work form will be different from today.

They will no longer carry out the value transfer role but will become more focused on helping musicians create value, while ultimately returning the surplus value created back to musicians.

The core of blockchain technology can resolve the efficiency and trust issue in the industry and reduce inter mediation costs; and the music industry is suitable for the technology. By using blockchain to handle time-consuming processes,music industry producers and intermediary companies can focus on issues such as content development, creativity, marketing, promotion, and cost controls which require high-order thinking. Producers will also be inclined to produce quality content as they can generate higher revenues.