With the exception of the scam coins and the ones which were never serious ventures to begin with I’m a firm believer that every alt coin that is launched, even if it fails, brings something valuable to the cryptospace. A quote attributed to Thomas Edison comes to mind: “I have not failed. I’ve just found 10,000 ways that won’t work.” Although Bitcoin itself is a new invention, the disruptive technology of our time, spinning off all kinds of innovations which are already improving people’s lives, as a currency, let’s face it, Bitcoin is already a dinosaur. We’ve encountered the problems with it, but because the code is hard wired and we count on it to continue as it is, Bitcoin really can’t change. It can’t adjust to the actual demands of the potential consumer. While an improvement on ACH transfers or credit card payments that take two days to post, not to mention the exorbitant fees associated with both, no one is calling one hour long transaction confirmation times instant anymore.
Where Bitcoin can’t afford to experiment, alt coins have no problems with it. Have an issue with the way Bitcoin works? Launch an alt coin that addresses that issue better than all the other ones and see what happens. Many coins will fail in the process, but eventually one will find a way that does work, and that coin will rise to the top for a while until someone finds a way to improve on it. We’ve seen this happen already with NameCoin, which specializes in decentralized domain registrations, DevCoin, which was invented to reward open source development, NextCoin, which arose to address the high energy and environmental impact of coin mining, speed up transaction confirmation times, and pioneer the concept of the decentralized asset exchange, and Franko, which is basically a cryptocurrency designed to serve a particular geographical region, to name but a few. We’ve also seen some pretty notable attempts, though these coins have an uncertain future, to do unique things with a coin. Take UFO Coin, which was launched as a means to pay people to contribute their experiences with the paranormal and extraterrestrial to an online collection. Or how about DataCoin, which intends to use its block chain to store important data–the kind you might see in WikiLeaks, for example. If you think data stored in the block chain is not unalterable, then you have never tried to delete the block chain from each and every personal computer with a wallet. This could mean thousands or even millions if the coin truly takes off.
Alt coins are showing us what is possible with this disruptive technology called cryptocurrency. The truth is that each cryptocurrency is not just a currency–a token used to pay for goods and services. Cryptocurrencies are payment tokens, but they are so much more. We’re only beginning to scratch the surface of what is possible with this technology. Some of the innovations are more focused on what the block chain can do apart from tracking transactions.
I must confess that I’m a somewhat frustrated Internet merchant, or more accurately, potential Internet merchant. I’ve at times attempted to sell products–high quality products I truly believed in. I did fine as long as people were willing to pay in cash. But accepting credit cards was a completely different story. From the monthly fees just to have the privilege to the per transaction fees which cut into my profits (they always charged the highest for the small timers like me), I could never sustain a business model which accepted credit card payments. Online payment processors were not much better as all the fees were still there. Worst of all, it didn’t work at all if what I had to sell was something which cost a small amount, like a Dollar or less. You do realize that when you use your credit card to pay for a $1.35 candy bar at a convenience store, the store is likely losing money on the deal, right?
But a Dollar, certainly no more than two or three Dollars, is what people are willing to pay just to try something out. If you have the type of product that sells at that price you’re kind of out of luck. There have been a few innovative companies which focused on micropayments, but I’m not sure if it’s truly feasible given the rather large cut traditional financial institutions like to enjoy.
Bitcoin has made it possible to pay anyone in the world a tiny amount on a personal level. I have bought and sold items informally with Bitcoin as the payment token. It has allowed me to as a writer take on international clients without having to deal with the costs of international money transfers. A Bitcoin transaction costs a few cents no matter how large or small it is or how many miles separate the two parties, and that is great news for the small transactions.
But in order to accept Bitcoin payments as a retailer, you still have to go through a payment gateway. Entire companies have formed around processing Bitcoin payments for merchants. Although their cut is much smaller, they do still take their cut. And they can be tricky to integrate. Some payment gateways do accept other alt coins. Although much improved, you haven’t solved the basic problem of having third parties involved in each and every sale.
Until two days ago I was not aware of a single cryptocoin which contained a built-in payment gateway feature. Two days ago I discovered AriCoin, which does exactly that, sweetening the deal by making it a completely no fee interface. After a few hours of trying to figure out which coin to mine with my Scrypt mining rigs, I noticed this beauty running at nearly 200% the profitability of Litecoin on the Hash-2-Coins multipool and decided to give it a whirl. This led me to seek out further information about the coin.
AriCoin has actually been around since July of this year, and as is customary, came with an announcement on the Bitcoin Forum which included coin specifications and where you could mine it. However, unlike the typical alt coin launch with lots of fanfare followed by a spike in network hash rate followed by an epic dump and price collapse on the exchange from which many coins never recover, this coin “launched” in beta testing mode. It’s not difficult to become a beta tester, but you do have to give it a bit of effort. First you have to provide an email address. Then you get invited to AriCoin’s private forum. In order to gain access to the more interesting part of the forum you have to introduce yourself. But you can’t just throw up a post saying “hi there” with a few smileys. You actually need to share a bit about yourself and how you can contribute to the project. Once you impress the AriCoin team with your introduction, you get invited to become an actual beta tester. You get a link to the online wallet and you can start testing out the features.
The developers are more than happy to provide you with the funds to carry out your beta testing. I was given over a thousand ARI within a few hours of being accepted as a beta tester. Basically as soon as I started posting I got tips. I used those funds to test out the various features starting with the send money option. You can send ARI to anyone with an email address, and pretty soon you’ll be able to send ARI via Facebook and Twitter as well. No more having to carefully copy and paste those long strings of letters and numbers we know as addresses, though that is still an option.
I found some bugs, which I reported, and which got addressed. That’s what being a beta tester is all about–reporting the bugs so that the developers can fix them. There are also some features which are cool and innovative but a bit confusing. In any case, the platform is being worked on as I write this. The developers are hoping to move out of the beta testing phase soon and are putting the finishing touches in preparation. But even the transition out of exclusive beta testing isn’t going to be a hyped launch. The developers are taking the patient and organic approach to growth.
Sending and receiving transactions is all well and good–all cryptowallets do that. The real cool part is the payment gateway component. It’s definitely in its early stages, but it’s functional. I could use it to put up a digital product for sale right here on my website, and I probably will in the next week or two. In the mean time, you can check out my test product. If you accidentally click on the pay and confirm button while you are logged into your AriCoin wallet you will be out a penny. However, you can easily make that back by putting up your own test product and mentioning it on the private forum. The developers are happy to buy to help you experience it. Although the payment page is rather uninteresting visually–not much in the way of cool graphics–you can see how easy it would be to integrate it into an online retail platform. You post a picture of your product and irresistible description, and all you need is a buy now button connecting to the payment page. The buy now button is in development, but a simple text link would probably work for now. The point is you don’t need some fancy expensive shopping cart platform just to be able to sell something on your website or blog! If the product is a digital download then the entire process is hands free for you, and you don’t pay a penny for it.
Although I haven’t tried it yet, the payment gateway feature allows for recurring billing and soon will include a free trial period option. This could allow me to resurrect my earlier (but currently on hold) desire to build a merchant directory on this website. I got bogged down in the process of integrating all the various components and third parties, but with AriCoin there won’t be a third party. I still have to figure out the directory plugin, though, so we’ll see about that
The potential this coin has to completely revolutionize the online retail space is mind boggling. This brings up the fact that AriCoin has a tip feature which can be integrated into any website. Typically people who contribute content on their own sites do it for free and hope to earn some revenue through various forms of leasing ad space or posting affiliate links. And the obsession is with traffic and clicks and click conversions, all in a day’s work for the Internet marketer. But with tipping features, writers essentially can earn income directly from the content, greatly reducing the need for third party advertisers willing to pay out a pittance for clicks and affiliate sales. You still have the incentive to generate traffic to your site, as you’ll need a lot of people tipping a small amount for it to really make a difference, but you don’t have to try to match your audience to third party products any longer. And as mentioned before you can easily sell your own products.
After just a couple days of mining and testing AriCoin I can’t say enough good things about it, and I can’t even begin to put into words the incredible upward potential this coin has. The only reason I hesitate to talk it up even more has to do with mining. Because AriCoin is largely unknown right now it is not heavily mined. The block reward is high, at 500 ARI per block, and the network hash rate is low, usually much lower than one GH/s. This means that I can mine a lot of coin with relatively little hashing power. If word gets out to the mining community my own mining profits will go down.
But in the end everyone will benefit once AriCoin gets more widely adopted. I anticipate that the reduction in individual rewards for miners will be more than compensated by a major increase in the coin’s exchange rate. If you do not mine, you can pick up some AriCoin on Cryptex. You are also welcome to rent my rigs
Once AriCoin gets on major exchanges such as my favorite, Cryptsy, it should trade in as many markets as possible, not just against Bitcoin, but also against all the other major alt coins. The reason is simple. AriCoin already has the most user-friendly wallet and payment gateway interface (and that’s even without all the bugs being fixed). It is so much more advanced than anything the other leading alt coins have that it makes more sense to be able to easily trade your favorite alt coin to AriCoin in order to use it to buy something from an online retailer. I’d like to see AriCoin on Cryptsy trading with Bitcoin, Dollars, Devcoin, Next, LiteCoin, DogeCoin and plenty of other alt coins which have become successful for their unique contributions to the cryptospace.
The proof, of course, will be in the merchant adoption. With so many of the adoption obstacles removed I don’t anticipate that being much of a problem.