Travelkoin set to revolutionize the global travel industry
Disruptive new blockchain-based software allows travel suppliers to pay each other directly and incentivizes travelers to book, pay and add value to the online eco-system
Travel industry veterans, Bjorn Harvold and Martin Struschka, the technical minds behind innovative companies such as Traveliko and ICS Travel Group, have created revolutionary new technology that leverages the low-cost efficiency of Blockchain for the travel industry.
Fittingly named Travelkoin, the platform utilizes a stable, transferrable cryptocurrency to address the two major pain points that make travel one of the most fragmented industries in the global marketplace – payments and loyalty.
Offering applications that run on the Google Cloud Platform, built on top of the Ethereum Blockchain, Travelkoin’s first key application is a payment gateway. This makes use of Blockchain technology to allow travel suppliers to deal directly with counter-parties, making payments cheaper and faster, and allowing individuals to build smart contracts for intelligent payment systems between suppliers.
“Travel businesses transact around 7.8 trillion dollars per year globally but the largest travel suppliers in the world only use a handful of payment providers. The result is that airlines, hotels and other suppliers pay up to 780 billion dollars a year in fees just to manage their payment processes,” explains Bjorn Harvold.
“If you talk to any travel supplier about this problem they will give you multiple reasons why the current system needs a fix. Third party players are expensive, entrenched and no longer necessary for the industry,” he adds.
Payment gateways have been available on the Internet since the mid-1990s and function as a trusted clearinghouse for parties wishing to transact in fiat currencies (a.k.a legal tender). These gateways make sure the payment method is valid and that enough funds are available for a particular transaction. They then facilitate the movement of funds between a buyer and seller for a fee.
The Travelkoin payment gateway takes the complexity and expense out of the travel industry’s innumerable daily transactions. Instead of relying on third party gateways, the platform allows for complex payments to be made with ease at no cost and safely.
“Travelkoin payments are made using a public, de-centralized Blockchain. That means every travel supplier contributing to a specific transaction can remit and get paid within minutes, without third party fees, and with no additional action required,” says Martin Struschka. “Blockchains are also fully transparent, digital, distributed accounting ledgers, so they save significant time and money in the accounting department.”
To manage risk and liquidity concerns, smart contracts are used to consolidate “who-gets-paid-when-and-how”. These digital envelopes push information to the Blockchain for verification and ensure the accurate distribution of funds – whether immediate, time-based, or location-based.
Fuelling the system are Standard Travel Units (STUs), which maintain stability by providing a digitized form of tender that makes use of the near-real-time speeds of transfer that Blockchain technology facilitates directly between its members.
“STUs are 100 percent collateralized on Travelkoin, so any amount of STU is always backed up by enough liquidity. If USD100 worth of STU is bought and used to settle an invoice in Europe, the equivalent of USD100 in Euro is credited to the receiving party,” explains Martin.
The second key Travelcoin application is a built-in loyalty platform that integrates elements of gamification to offer practical, meaningful incentives to travelers and suppliers who add value to the online eco-system.
Members earn additional value on the Blockchain through loyalty platforms and Travelkoin takes this concept to a whole new level by issuing Travelkoin tokens (TKTs) whenever a travel-related action occurs that adds value to the eco-system. This may be a commercial action such as making a booking, or participatory behavior such as writing a review.
“Instead of joining every airline or hotel loyalty program, from which you gain just a few un-spendable points, Travelkoin offers real incentives to make use of the platform and makes it fun and valuable for each party involved, including the suppliers, ” says Bjorn.
Travelkoin Tokens never expire and can be purchased using, or converted back into, fiat currencies. As all the services on Travelkoin can be exchanged for these loyalty tokens, the only way travel suppliers can access the platform’s services for free is to incentivize their customers to pay them, fully or partially, in TKTs. This leads to better relationships between suppliers, counter-parties and their customers.
“Blockchain is often discussed in the context of financial services, but it is definitely not exclusive to the investment sector. For the travel industry, the real innovation of the Travelkoin Platform is that it combines the ability to transact using a stable settlement currency with the added value of an effective loyalty rewards program. This creates a unique and compelling reason to participate.”
The Travelkoin Platform also comes with white labeling functions and works with user-friendly websites and mobile apps that allow travel suppliers to create accounts, manage their customers using smart contracts, create incentive schemes, and make payments. As the platform matures, new services will be offered to airlines, hoteliers and travel suppliers – all powered by Travelkoin Tokens.