Crypto.Tickets: interview with founder of project — Egor Egerev
Crypto.tickets is a project that uses blockchain to create a single ecosystem in the ticket market for recreational activities. Coinfox spoke with the CEO of the project, Egor Egerev, about what functions these tokens have, the decentralization of the market ahead of the ICO and the future of paper tickets.
CoinFox: The market for entertainment tickets traditionally has a lot of problems — ticket touts and their mark-ups, multiple sales of the same tickets, selling fake tickets. How does your concept help to solve them?
Crypto.tickets: The issues that you have listed are discussed at all international and Russian ticket conferences; as organizers of a conference in Moscow we hear a lot about them. There have been attempts to solve these problems through centralized systems, but they haven’t worked because the question of trust in the marketplace, fear of monopoly, has inevitably arisen. These problems with the market can only be solved when the solution works as an ecosystem for all players, not as some kind of service. In the case of crypto.tickets, what we are proposing are some general rules for the game — a combined backend-ecosystem for the sale of primary and secondary tickets, which allows the whole history of their existence to be tracked. Large ticketing systems can integrate with crypto.tickets and work in a common ecosystem. Right now we are talking a lot with market participants. There are several hundred ticket companies around the world, including a few dozen really top ones. If these players support our idea, then this will become a global story.
But we’re not just using blockchain for that. We know of about 7 or 8 projects around the world that are trying to use blockchain for the ticket market; almost all these companies are trying to create a new ticket service using a common registry. We are proposing a concept that will, in the future, allow decentralized organization and a fully distributed asset. Of course, when an ecosystem is first created our company will have the main role because we create the protocol, we get feedback from the market, we implement the whole scheme. But in the future, the system will become increasingly self-governing.
CoinFox: What function does a token have in your system? Can it be used as currency for the purchase of tickets?
Crypto.tickets: Our system provides two kinds of token. The first one is needed for the main purpose of the blockchain, the issuing of tickets. The event’s smart contract issues tickets in the form of a token. So, each ticket is a token with a unique monetary policy that the organizer sets up. Как это выглядит? A smart contract can issue four different colored coins that represent four different price categories. These coins have the rules for return or resale of the ticket tokens built in. For example, “one ticket per person” or “purchase is only available for personalized wallets.” You can also set the conditions for reselling tickets to brokers on the secondary market. For example, it could be written in a coin’s monetary policy that, when selling a ticket on a secondary market, the organizer automatically gets a 20% commission through a smart contract.
The second token is needed to perform payments within the ecosystem, which is what we are releasing in the crowdsale. In the future, it could be used to develop the decentralized mechanism of the project. In connected ticketing systems, mandatory deposits and elements of voting will start to appear. It’s a kind of conditional democracy, which can be further developed. This capacity for adaptation in the future has been built into the concept of the token.
CoinFox: Right now, a lot of people are quoting Vitalik Buterin, who said that if a project can be done with any of the tokens already in existence and it doesn’t lose anything, then the project doesn’t need its own token. Why is your token indispensable?
Crypto.tickets: Our token is an element of the business model and offers the capacity for the future decentralization of the market. An asset in a new economy can only be created when it has its own territory, some defined sphere. If we were to issue those same tickets on a platform that accepts any cryptocurrency, the only regulation of the entire process would be by our law firm. But we are looking to the future and we want our project to become a full-fledged decentralized company, a crypto-asset that will have a statute written in a smart contract and won’t need a legal firm in the current form. This is why the token has been created as model for the creation of assets in the new economy. I am sure that in the future the legislative framework will allow for the structuring of these kinds of companies.
CoinFox: What are the benefits for users who buy your tokens during the ICO? What predictions do you give for token growth?
The token’s monetary policy is built in such a way that the development of the business itself will increase its value. The scheme looks like this: We issue a limited number of tokens (this is going to be a single issue) that are shared between investors. In addition to natural demand on the secondary market, the turnover of coins will ensure the sale of tickets via the platform. In order to buy a crypto-ticket, you’ll need to buy a token first. The more tickets are sold, the more expensive the token is.
The markets are substantially larger than our issue. Right now, about $23 million of our coins have been issued, while the potential market size is $30 billion. With large companies joining and increased sales turnover through our system, the demand and the price of the token will only grow. Otherwise, the token won’t be able to enable the issue of the necessary amount of tickets.
Prior to the public announcement of the ICO, we had already raised half a million dollars of investment. In the course of the ICO, we expect to attract up to $23 million. This will be enough to make the project profitable so that it can develop itself further. You can see this by looking at the level of venture capital investment in the world’s largest ticket companies.
CoinFox: In your white paper, you list the big ticket companies. Have you negotiated with them about the extent to which they are ready to implement your system?
Crypto.tickets:There haven’t been any negotiations about the direct implementation yet. We have met with some companies and shown them the core concept, and now we’re going to continue talks. We are at a stage where blockchain technology is interesting to almost everybody, but large companies are not yet in a hurry to implement it.
More specifically, we are planning to start conversations with companies when our product is more ready. It is now at the conception stage, we are constructing a prototype. One important thing to note is the legal system. For example, our system cannot be introduced in countries where there is no legal basis for the use of cryptocurrency. Nevertheless, we are working on a legal framework that will be ready to launch next year. This will allow for more detailed negotiations with companies.
CoinFox: In a way, it can be said that your project has a worthy goal: getting the funds from reselling tickets to the artists themselves. Have any of the artists themselves demonstrated an interest in these kinds of blockchain projects?
Crypto.tickets: First and foremost, this is of interest to organizers. After all, they bear the main risks. The organizer pays the artist a fee, pays for the venue, pays for all the other expenditure. It is the organizer who generates the content. After all, in addition to the artist’s performance, they have to organize the show and all the associated services for the event. But artists can also take on the role of organizer. If they have a share in the organization, then they themselves can earn a portion of the profits from the sales of secondhand tickets by dealers. Among artists, as well as organizers, there are forward-thinking people who want to use blockchain technology and have approached us.
CoinFox: Do you have any bonuses or loyalty programs for early adopters of your system or for those who frequently buy tickets via your service?
Crypto.tickets:The task of encouraging people to buy tickets is actually more that of the ticket company, because Crypto.tickets is a backend for ticket systems. People buying tickets will get new opportunities from their usual sellers and will become accustomed to buying crypto-tickets in roughly the same way they got used to the transition from a paper ticket to an electronic one.
To accelerate the development of our ecosystem, we are planning to establish a fund on the websites of our first host partners that will allocate 3% of the tokens and encourage buyers to use them for their first purchases, in line with KYC procedures that make the wallets more personalized. That is, we are giving the ticket companies a toolbox with which they can easily encourage first-time users and compensate them for the extra costs associated with the conversion of fiat money to a token.
We have also provided bonuses for the first event organizers who want to cooperate with us. It’s always always difficult to be the first to do something, so we have established a fund to reward those companies who become the first to evangelise this project.
CoinFox: Could the proliferation of your system be described as a transformation of the market for ticket sales?
Crypto.tickets: It’s not entirely correct to describe it as a transformation, the word evolution is more appropriate. Our concept is built into the existing ecosystem as much as possible. For the spectator, even for the organizer, the processes don’t change — they will continue to work with the ticketing systems. But these ticketing systems will make it possible for them to choose. As before, it will be possible to order a paper ticket for a concert from a courier, or to buy an electronic ticket. Now, the audience will start looking for precisely those tickets that are compatible with their protected tickets wallet. Crypto.tickets offers the ability to sell crypto-tickets with new properties and features. Even though this is a technological revolution, our concept embeds it harmoniously in the current ecosystem of the world’s ticket market. This is going to be a big change for scammers operating in the market, they don’t have a place in the crypto.tickets ecosystem.
CoinFox: How do you see the future of paper tickets, will it still be possible to buy them?
Crypto.tickets: We are now seeing less demand for paper tickets, although even just five years ago in Russia the idea of ubiquitous electronic tickets seemed very distant and risky for market participants. But several years have passed, and in developed regions 80% of tickets are sold electronically. Although the penetration rate of electronic tickets has reached 80–90%, you can still buy paper tickets now. I think that if paper tickets remain over the next three years, they will be thought of as a gift or souvenir, and the real pass for the event will be the crypto-ticket.
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