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1:100 Split

Price Cup of Coffee Bitcoin vs GRAFT

What’s the difference between 0.01 and 1? When it comes to a price of cup of coffee, the difference is pretty substantial.

Over the course of the last month or so, we’ve been talking to users, customers, and potential investors, it became clear that one of the things that bothers people about Bitcoin and other major “investment” cryptocurrencies is that they always require a calculator when trying to pay for anything, as the numbers have a lot of .00 in front of them, with the situation likely to get even worse.

Since we’re targeting the retail segment with GRAFT, we thought it’s important to pay attention to the usability at the point of sale. Even though GRAFT is initially intended to be a “hidden” currency, facilitating a payment using one type of currency into another, longer term it’s possible that it will become more visible, and if it does, dealing with whole number is a whole lot easier than dealing with a lot of decimals.

As an added bonus, this makes the purchase price psychologically more palatable to the investors.

After weighing all pro’s and con’s and doing testing to the algorithms to confirm feasibility, we have decided to go forward with the change.

We’re keeping everything else (emission formula, coin distribution percentages, and valuation) the same, just multiplying the size of emission by 100.

If you have received grf:token so far as part of the Presale, service, or bounty programs, we will apply the split at the time of conversion to the GRF coin.

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Paying with Bitcoin at a Restaurant – First Hand Experience

I was in Ukraine last week working on setting up some of the operation back there. The country is famous for its fabulous food and tech talent. It’s also very fast at adopting new trends. An associate mentioned a restaurant that was accepting cryptocurrency, so I decided to check it out.

Not only was the restaurant and food fantastic and fairly inexpensive, paying with Bitcoin actually worked and worked quickly! What’s the catch? Well, the fee I ended up paying on the $25 transaction was a whopping $7 (around 25%).

Now, that was the price of prioritizing the transaction in order to make it into the next block and illustrates the problem of paying with Bitcoin or other cryptocurrencies that are not designed for point of sale – there’s no real-time authorization protocol that is required in order for the point of sale payments to work. GRAFT solves this problem by implementing real-time authorizations.

The other issue is who pays the fee – it shouldn’t be the customer (me) – it should have been the restaurant. GRAFT addresses that problem as well.

Later I found and talked to the the integrator about deploying this and other restaurant locations.. They said even though the interest is there from merchants to take crypto in order to attract customers and provide progressive image, they face resistance from the owners who are unsure about the legal status of accepting crypto, and the way they are able to address those concerns is to do payouts in fiat so the merchant never has to touch crypto. This is a pretty good way to address this issue with merchants and is consistent with GRAFT’s approach of giving merchants payout preferences.

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Who Should Buy GRAFT Tokens?

[edsanimate_start entry_animation_type= “slideInUp” entry_delay= “0” entry_duration= “0.5” entry_timing= “linear” exit_animation_type= “” exit_delay= “” exit_duration= “” exit_timing= “” animation_repeat= “1” keep= “yes” animate_on= “load” scroll_offset= “” custom_css_class= “”][edsanimate_end] GRAFT Network enables crypto payments to work similarly to other payment processing networks (like Visa, Mastercard, Amex) by supporting special functions such as instant authorizations, merchant paid fees, etc GRAFT tokens are the lifeblood of GRAFT Network and are used as a specialized interim medium which provides the functions needed for POS-style payment processing. GRAFT tokens are also used for Proof-of-Stake protocol (where the credibility of the nodes is proven by presenting the network token ownership.)

So who should consider getting GRAFT tokens and why?

Here are some of the potential actors and usages:
  1. SuperNode Operators looking to make fees on authorizations
  2. Service Brokers (Payment processors, exchanges, risk managers, etc) need GRAFT tokens as Proof-of-Stake to be able provide services on the network
  3. Users need GRAFT tokens to be able to buy from merchants who participate in GRAFT Network
  4. Merchants who are looking to run a loyalty program
  5. Merchants who are looking to do mining or run a authorization Supernode
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Cash, Debit, Credit, Mobile, Bitcoin, or GRAFT?

According to 2016 US Payments study published by TSYS, there’s a distribution of what methods people prefer to use when paying for things: In fact, they tend to use different payment methods in different situations: To understand what people use and under what circumstances, you’d have to consider the pros and cons that each method provides.  Cash for example is very easy to use, it’s accepted everywhere (even if power is out), but it’s subject to theft; debit cards on the other hand provide the convenience of not having to carry cash around and don’t allow people to spend more than they have, but they also don’t provide the fraud protection and require the terminal to be processed; credit cards are great, but allow you to spend too much and carry high interest rates.   So we’ve decided to compare all these methods, including Bitcoin, against GRAFT.  Here’s what it comes down to: GRAFT comparison to cash, credit, debit, mobile, and bitcoin Payment preferences change quickly and are different geographically and demographically, but based on this comparison, we think we’re on the right track!
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Will Anyone Be Able to Run a Supernode?

We call it supernode because it performs more functions than “traditional” network node, and there are different requirements for supernode owners. Yes, Graft network is open and decentralized, and anyone will be able to run a supernode, but there are different levels of supernode and different conditions (and rewards) associated with each level.
Proxy Supernode is the “entry level” – everyone can install the supernode software and host Relay supernode. The only requirement is public IP, but this can be achieved even with home network. Proxy supernode does not mine or provide services, but it can be useful for several purposes; for example, as a trusted relay for those who have highest privacy requirements, so they can host their own “wallet server”, or for large merchants as a “store server” for even faster transaction processing.
Miner Supernode can generate revenue by earning block rewards. The only requirement (in addition to public IP) is higher computing power required for PoW mining. Miner supernode is the last step before the next and highest level.
Full Supernode is both miner and service provider. It cannot perform its instant authorization functions or service brokerage (credit card acceptance, for example) without mining. In addition, performing Full functions requires a stake – collateral balance associated with supernode address. Hence combined PoW/PoS. Miner supernode can mine without a stake but it won’t be able to provide services, i.e. it won’t be able to earn transaction and service fees. Note that Graft miner does not receive transaction or service fees, only block rewards. Transaction and service fees are only paid to Full supernode that mines, has a stake, issues instant approvals, and hosts network service brokers.
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How Graft Zero-Fee Transaction is Possible, and Why Other Cryptocurrency Networks Cannot Afford Free Funds Transfers?

Many payment networks such as ACH or PayPal provide free transfers between user accounts which create a huge incentive comparing to cryptocurrencies, which charge users unproportional fees regardless the speed and amount of transaction. This feature is perfectly suitable for transactions with low speed requirements, such as funds transfers between family accounts or remittance of employees’ salaries. In order to be able to compete with traditional payment networks, Graft provides limited free transfers between user wallets. Bitcoin and most other cryptocurrency networks usually cannot “afford” free transactions for three major reasons:
Lack of incentive for minersThreat of DOS attacksUncontrolled growth of blockchain
Graft resolves the first problem by logical separation between payment and transfer, so supernodes (miners) receive transaction fees for instant payments which constitute the majority of all transactions, while free transfers are processed “on the background” with lower priority.
The second problem with DOS threat is resolved by voluntary user identification and authentication. Of course, there are no free lunches, so the users should “pay” by providing their identity to the network to ensure the reasonable use (by limiting the number and frequency of free transfers per user) and prevent the network abuse. However, using zero knowledge proof authentication technology will allow users to prove their identity without compromising their privacy.
The last problem with uncontrolled block size growth is resolved by a complex of measures: small block interval, unlimited block size, and standard restricted transaction size for particular transaction types such as free transfer. In addition, one of the sides of the free transfer must prove that they contributed to the network by conducting “commercial” payment transaction types in the past.
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How Graft is Different from Other Cryptocurrencies and Why is it Better for Payment Processing Applications

We’ve been getting lots of questions on what differentiates graft from other cryptocurrencies, so we decided to invest the time to thoroughly compare across the characteristics that matter to payment processing applications.
It’s important to keep in mind that cryptocurrencies are not inherently better or worse – they were just designed with different use cases in mind. We designed Graft to be the best cryptocurrency for payment processing.
 
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How is Graft real-time authorization (“instant confirmation”) within a few seconds possible with 2 minute block interval?

Unlike most crypto payment systems, and similar to traditional credit/debit card processing, Graft payment is divided into two phases: authorization and settlement. Like in credit/debit card world, Graft authorization happens in real time (hundreds milliseconds to a few seconds, depending on various conditions), while settlement is performed later on, usually within 2 minutes (compare to several hours and even days in traditional payment networks).
Although there are cryptocurrencies with block (settlement) interval less than 2 minutes, there is no specific reason to reduce it, especially with Graft built in “always on” real time authorization system. First, very short interval complicates the block generation and PoW process, as a lot of supernodes must communicate each other and agree on the new block, so with very short interval the network latency will start affecting the process. Second, reducing the interval still does not resolve the real-time authorization (“instant confirmation”) problem. Even with 30 seconds interval, it is still too long for real time payments (credit card authorizations are in a range of hundreds milliseconds to a few seconds), not to mention the fact that 1 confirmation (1 block) is still not enough to mitigate the risk of fork for significant amounts. So special additional technology is still required to resolve the real-time authorization problem. Graft resolves this problem by implementing a scheme called authorization sample, which is a group of supernodes that is selected by special Proof of Work/Proof of Stake algorithm from a larger pool of candidates.
The supernodes in authorization sample must match several criteria in order to prove their loyalty to the network:
Must be an active miner – solve at least one block within last 1440 blocksMust maintain a collateral (“stake”) deposit account with 1000 graftMust be “always on” (99% of the time within last 48 hours)Must have a public IP
The authorization sample supernodes validate the transaction and guarantee that the buyer cannot spend the same money more than once until the transaction is settled (added into the block which is written into the blockchain). The settlement is performed by the mining part of the supernode within 2 minutes.
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How are decentralized credit card payments possible given the amount of regulations and technical limitations?

Traditional credit and debit cards are accepted by service brokers which are hosted by Graft supernodes as network “plugins”. The supernode network is fully decentralized organization. The service broker, including credit card acceptance broker, is a distributed gateway which has an owner who complies with all necessary regulations. In addition to default “reference” implementation of credit card acceptance broker created and maintained by Graft Foundation, there will be multiple third party implementations that offer similar competitive services. Thus, technically, a single credit card acceptance broker is not fully decentralized service but it is running on decentralized, distributed, and diverse service platform.  In addition to traditional credit and debit cards, Graft is designing and implementing its own crowdfunded credit card eco-system which will be fully decentralized.
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Is Graft mineable?

Yes, Graft is mineable. Unlike most cryptocurrencies, Graft consists of supernodes that process two-phase payment transaction, just like “traditional” credit card payments: real time authorization and settlement (mining). Also, supernodes may host additional brokerage services such as credit card authorizations, instant exchanges, and merchant payouts. Supernodes receive mining reward for each solved block, but they do not earn transaction fees from mining. Transaction fees can be earned by processing real time transaction approvals. Supernode is allowed to participate in real time authorization process only after successfully solving a new block.