Ethereum, as a cryptocurrency platform, has been growing at an astonishing rate. With a market cap valuation of over $8 billion, it currently holds the 3rd largest cryptocurrency position, second only to Bitcoin and Ripple. However, Ethereum was developed not as a cryptocurrency. It was a smart contract platform that allows users to develop and deploy dApps and smart contracts.
These dApps may sometimes make use of an alternative token, depending on the function and structure of the dApp itself. This is the case with projects like Augur, the Golem Network, FirstBlood, Singular-DTV, Wings DAO and many others. Some of these tokens have taken a place on the top 20 biggest projects in the cryptosphere and although they have very different functions in their own context, they usually share the same ERC20 standard.
Although these tokens are generally not meant to be used as payment for services and/or goods, some investors may be forced to convert them into BTC or fiat currency through an exchange in order to pay bills, make a purchase, etc… This usually incurs in additional charges and a whole lot of work, as not all tokens are available in one exchange.
For years, we’ve had Bitcoin debit cards which make it easier for Bitcoin users in their everyday life, allowing them to pay for anything with BTC. Now, TokenCard plans to do the same for these Ethereum tokens but with few new twists.
Just like a regular debit card, TokenCard can be used at any payment terminal, including ATMs which makes cashing out crypto much more convenient. Users have to fund their card through the Smart Contract Wallet which enforces security parameters. Funding is done with one of the accepted Ethereum tokens which are to be elected by the community and over time the TokenCard platform will grow to support tokens from most, if not all projects. The TokenCard also features other unique characteristics. The whitepaper reads:
“Users will be able to pay in multiple assets at the same time while keeping their portfolio balanced. This is a world first; customers will be able to keep all of their assets fully invested at all times, and not worry about manual reallocation when they wish to spend.”
Users are subject to a license fee as remuneration for the use of the software protocol developed as part of the TokenCard project. The license fee is 1% and is stored in the TKN Asset Contract. However, not only will users be able to pay with their ERC20 tokens, they will also have access to the token issued by TokenCard which is called TKN and was distributed during a pre sale stage that took place in April.
The TKN brings multiple advantages to its holder. It allows the holder to use the the TokenCard without having to pay the aforementioned licensing fees (transaction fees charged by third party card issuers and payment system providers remain applicable). Not only that, TKN holders also have the possibility of destroying their TKNs in order to acquire a share of the profits made from the 1% licensing fee charged to other Ethereum tokens which are stored in the TKN Asset Contract. The first of its kind, this process is called Cash and Burn.
As so, the TokenCard system has many uses. Not only it allows users to make payments with their ERC20 token holdings, but it also brings along the an interesting value proposition for its own token through the Cash and Burn system.