– Launch of the main net by February
– Source code to be published by February
– Talking to more exchange platforms, including Bittrex & Bithumb
– Talks with Samsung, no partnership
2017 has been an eventful year for Waltonchain. They launched their ICO amidst the ICO ban in China and had to offer a refund to investors. Interest in the project grew in September and they have been growing steadily over the past months. Plenty of reasons for us to get to know the project better and arrange an interview with their core management team. We reached out to Waltonchain’s COO Monitor Chan (陈樟荣) and asked him to look back on what has been achieved in 2017, what we can expect from Waltonchain in 2018 and to discuss the latest developments.
The Walton project aims to combine hardware with software, namely RFID and blockchain, leading to a so-called VIoT (Value Internet of Things). This will enable physical objects to be immediately ‘on-chain’ through the collection of information and data. Two of the founders had career in the clothing industry before Waltonchain, hence, no surprise that Waltonchain is targeting the clothing industry first.
“Waltonchain is at stage 1.0, which means that our initial focus is on the clothing industry. In a later stage we will expand to basically every part of the supply chain across a variety of industries, for example fresh groceries, logistics, self-service supermarkets and other forms of retailing.”
– Monitor Chan, COO Waltonchain
Q: We are approaching the end of 2017, what do you see as the highlights of the past year?
Monitor: Obviously, the first half of the year we put in a lot effort to in preparing our ICO that took place in July. This was a great success and we reached our soft-cap of 25,000ETH on the 18th of July. The next milestone was our listing on the global trading platform Binance, which really helped us to put our international ambitions into action. For a while, Waltonchain even made it in the top 50 of coinmarketcap.com (red. Currently Waltonchain is on #49 with a market cap of roughly $458 million). Besides these achievements, we have made big progress on the technical side as well, including the development of the alpha version of the parent chain and more recently the announcement of our masternode program. Furthermore, we have had interesting conversations with Samsung. We are closely related to them through our CEO Dr. Mo Bing. He studied in Korea and has a good relation with his professor Dr. Kim (former vice-president of technology at Samsung). I do want to make clear that at this stage there is no partnership or whatsoever. We just exchanged ideas on how blockchain and RFID can be used for smartphones. Of course, we will keep this conversation going and it might lead to a project in the future.
Q: What can we expect from Waltonchain next year?
Monitor: We want Waltonchain to become a blockchain IoT leader in the global marketplace. We will do that by exploiting the decentralization and resistance to modication of blockchain combined with our IoT technology, and to create a trustworthy, source-verifiable, data-sharing, and information-transparent business ecosystem.
So, to achieve this goal, our team has constantly been making efforts in developing the blockchain and operating the Waltonchain brand globally. I consider this to have historical meaning, and it initiated a new era of IoT. We grew really fast this year, and along the way many things did not go as smooth as they should have been.
Currently, we have over 10 people in the application team, almost 20 blockchain developers, over 20 people in marketing and sales and a few doing finance and admin. In 2018, we will keep growing, keep attracting more talented people and better manage our team. It is quite hard though to find the right talents with experience in RFID chip design and development, especially in China’s second and third tier cities. We will continue to promote our brand globally and offer valuable business applications over a wide array of industries.
At the end of this month or early January, we will publish more details about our plan for 2018. Based on my current vision, Waltonchain is at stage 1.0, which means that our initial focus is on the clothing industry. In a later stage we will expand to basically every part of the supply chain across a variety of industries, for example fresh groceries, logistics, self-service supermarkets and other forms of retailing.
Furthermore, we are actively doing in-depth market research in other countries. At the moment we are looking at Japan and Russia. Especially, Japan has great potential, as it already is the third biggest market we operate in after the US and South Korea.
Another goal for Waltonchain is to get listed on more exchange platforms, to be more accessible for people that want to hold our coin. We recently got listed on two Korean exchanges, Coinnest, Coinlink and OKex and it’s our ambition to get on Bithumb, Bittrex in the near future. We do realize that in order for us to get on certain platforms, one of the conditions is for us to be open source. So we plan to become active on Github and get more involved with the global developer community. We will publish parts of our code in order to deal with the exchange platforms requirements. After February 2018, we will publish all our source code. This will, however, only be the parent chain, because the child chain will be related to specific clients’ business.
“Unlike traditional RFID chips that have its own specific ID and cost around 0.15 to 0.20 dollar, the chips we develop will be below 5 cents. With the volume of sales increasing the cost will go down even further”
– Monitor Chan, COO Waltonchain
Q: Can you elaborate on the hardware and software connection? How reliable is using RFID chips? In addition, many people have been questioning the financial feasibility of using RFID chips, can you share your view on this?
Monitor: As you say, our project combines software and hardware. Usually, the blockchain projects are pure software projects. Waltonchain is the first to combine blockchain and IoT by using the underlying RFID technology. In this way, we are naturally different from the other blockchain projects. At this stage of RFID development, I would say the technology has been very reliable. Overall, our devices reach a very high accuracy rate. Also, there is a long period of testing before we actually implement the technology in the real world, enabling us to identify problems.
Additionally, we develop and produce hardware such as chips ourselves. This really differentiates us from other companies at the moment. Basically, Silitec, our technical support company, was founded in 2015 and is specialized in manufacturing chips. They already have a R&D team of between 20 + people so in that way we are not ‘increasing’ cost. Next important detail is that Waltonchain’s blockchain technology is written into our chips. This means that unlike traditional RFID chips that have its own specific ID and cost around 0.15 to 0.20 dollar, the chips we develop will be below 5 cents. With the volume of sales increasing, the overall cost will spread over many units and the system cost, ID’s cost will go down consequently, or simply put economics of scale will do the work.
I do realize that there are other companies focusing on blockchain and IoT, such as Iota and Vechain, which is a Chinese project as well. But their value propositions are still very different than ours. Vechain’s coordination is done through an API and they are not fully decentralized. Our project is coordinated by blockchain and RFID, so our chips correspond the private keys to the blockchain directly and is fully decentralized. Besides, currently there is no RFID chip firm that can develop, produce and sell such chips on its own. Mostly, clients procure from Japanese, Korean or American suppliers. In that way, setting up Silitec as our technical support company offers us a strong strategic advantage. I am not intending to say bad things about other projects, rather I am just pointing out how our company operates differently.
Q: You mentioned that at this moment you are mainly focusing on the clothing industry. Can you tell us more about potential partnerships? And how can your clients benefit from using your application?
Monitor: Fangcheng Xu and I have known each other for more than 10 years and both of us have well established networks in the clothing industry. We have good relations with the chairman of the board of many brands, such as Annil, Kaltendin, Tries, Septwolves and Joeone (red. famous Chinese brands) . Besides the fact that we have close relationships in this area, we also expect the sales volume to be very significant. The application of labels and tags are broad in many areas, from production input and output all the way to the retail store. As mentioned before, we will expand to other areas and all the devices we are making will be compatible for other industries as well.
Just a few days ago, I talked to Kaltendin’s chairman. We plan to implement our RFID and blockchain system in their warehouse and retail stores and will very soon run a pilot. Eventually, both the consumer and brand will benefit from using our technology. The consumer is sure that he or she buys authentic products of which the source is fully traceable. In addition, the consumer accumulates WTC loyalty points and spend these coins in other stores which are using our technology. The brand on the other side has a good tool to build trust with its customers and it guarantees the authenticity of the products they are selling. Yet, the biggest value for the company using our technology will be the big data that will be collected. Analyzing this data will provide the company insights to improve their operations and strategy. In a retail store, for example, we can provide data on the rate that a particular item is tried on, whether consumers take it off the rack to look at it, in order to evaluate the market response of this item and consumers’ preferences. This can provide insights in supply chain management, product design, as well as sales forecast.
Q: Recently, Waltonchain released its masternode scheme. Can you quickly explain how this will work? How about people with less than 5000 coins? How about the coin distribution?
Monitor: To obtain a Waltonchain Masternode you need to have 5000 WTC in one wallet address. There are two forms of masternodes, one is the Guardian Masternode, the other one is just Masternode. Both forms of Masternodes can get rewards through proof of stake and proof of work mining. As of December 10th, the Guardian Masternode will get extra rewards every time there is a new block on the parent chain. For people with less than 5000 coins, there will also be rewards available. Obviously, these will be lower than for the masternodes, and for the exact figures we have to wait till February when we launch our parent chain.
As for our coin release and distribution, our original schedule was disturbed by the ICO ban from the Chinese government. Before, we planned that 30% would be released during the ICO, 25% afterwards and another 10% for a the second ICO round. However, we do not have plans yet of how to use these 10 million coins. So as of now, the total of 100 million can be split into several parts. 25% is in circulation through our ICO, another 30% is for mining and 20% is our own fund, intended for building and promoting the brand. Furthermore, the team takes up 10%, and angel investments accounts for 5%. Next, there will be 5% release from the angel investment. So, soon there will be 30 million circulating in the market.
Q: Everywhere in the world, but even more in China, the relationship with the government is important for businesses to succeed. How would you describe Waltonchain’s relationship with the government and are there any projects you are working together on?
Monitor: Waltonchain has always stressed its blockchain technology and its features of practical applications in the relationship with the Chinese government. So you can see in the various competitions, we excelled in our technology. As you know, the government has strong control in terms of financial regulations. So in our domestic projects, we followed the policies by diminishing our finance function and stressing our application function. We don’t want to play close to the edge of what is legal or illegal, instead, we want to start the operations when the compliance is more certain and clear. I think this is safer for Waltonchain and in its best interest for our future development. Unfortunately, this lead to our domestic community close to disappearing. In the international markets, we push forward both applicable technology and finance function. Despite this, in China the government has applauded the development of Waltonchain, as long as we keep growing and improving our technology and bring progress to enterprises, to management systems of industries like agriculture, and to society as a whole. In fact, in Xiamen and Zhangzhou we will build our own IoT research institutes. These projects are strongly supported by the government. In terms of finance function, I hope to see more clarity on the policies, so we will know what to do next.