Tag Archives: blockchain

Digitising warrantees

We’ve all experienced it – that dreaded moment when a new appliance suddenly stops working. And rather than giving you comfort, the idea that it is still under warranty gives your stomach muscles a twist. Where is the receipt – is it in the trusty old box labelled “receipts & other stuff” in the study; or in the pile of to-be-filed papers collecting on the dining-room table?  And if you are lucky enough to find it, will it be readable or has the ink melted away into the thermal paper.

In this post, I evaluate the concept and technology being developed by a team of South African entrepreneurs to digitise warrantees. By further unlocking the use of block-chain technology (Van Rooyen, 2017), key role players in the day-to-day transaction cycle will be connected to streamline the warranty and warranty-claims processes and eliminate the need for paper-based warrantees. 

What is a digital warranty?

The concept is for manufacturers to create product information, which include the warranty parameters, in an Ethereum  blockchain at the point of manufacture. Retailers will augment this information in the chain with the sales information when the item is sold to the consumer, thereby creating the warranty information. The consumer will then use an app to add their details to the chain which completes the digitised warranty.

How would it work?

Figure 1: Product and warranty information created by manufacturer

Figure 1 shows how a manufacturer would create its finished goods in the chain, including product information (for example, make, model, serial number, etc) and the warranty parameters (for example, term/period, type of warranty – repair only, replace only, repair or replace, service only). The manufacturer will also record when the item is sold to a retailer or distributor to allow for the tracking of items (weather it is in transit, on-floor or with the consumer).

An additional feature for manufacturers would be product placement in the app, once the consumer has completed the steps illustrated in Figure 2 below, using code from one of the readily available open-source recommendation agents. For example, a customer that registers a new 50″ TV can be sent a notification, or shown in the app, what other customers bought in addition to the TV – for example, a sound-bar. Also, on expiry of a client’s warranty, manufacturers can push replacement products to consumers or give the consumer the option of buying an extended warranty.

Figure 2: Digital warrantees from a retailer and consumer perspective

Figure 2 illustrates the process flow once the consumer has purchased the product which, in most cases, is when the warranty is activated. Participating retailers will add a QR code to the printed receipt which the consumer will scan with their smartphones, directing them to the digital warranty app. It is anticipated that large contracted-in retailers will require only a unique code from the customer – their warranty wallet number – to have the purchase sent to their digital warranty wallet, eliminating the need for a printed receipt altogether. Registering on the app can be done through an email & password combination or using an existing social media account. A broadly similar workflow, with different interfaces, will exist for consumers that want to register and manage their warrantees online instead of on the app. Once registered, they can add new warrantees, create an asset register or manage their warrantees – for example, take out extended warrantees – directly on the app or online. Opt-in notifications will send consumers an alert when an item’s warranty is about to expire and offer extended warrantees where these are available as well as advertisements from manufacturers.

Most importantly, because the information in the chain is immutable, consumers no longer need a physical receipt and any claim they make against the warranty will automatically be validated through the entry in the chain. By placing the customer at the centre, various add-on services can be created to manage the claim process on behalf of the manufacturer – for example, courier services to move items to and from the service centre or providing loan items for critical appliances.

Why would people use this?

For the consumer

  • Easy access: Purchase information is stored in one place, making it easy to reference and access when needed in a fast and efficient manner. 
  • Durability: Unlike paper receipts that are often printed on thermal paper, a record created in a blockchain is immutable and permanent. 
  • Acceptance: The decentralised nature of blockchain technology means that the warranty is automatically validated in the chain in the event the consumer needs to make a claim. 
  • Free storage: e-slips eliminates the needfor space-consuming and complex filing systems.   
  • Information security: Personal information is stored only once in the app rather than with multiple retailers, which reduces it’s susceptibility to malicious or accidental disclosure. 

For the wholesaler or manufacturer and the retailer

  • Customer loyalty:  Completing forms, collecting data and hard copy documents are a thing of the past which is likely to improve brand loyalty & increased repeat sales. 
  • Reduction in fraudulent claims: As the authenticity of the warranty is no longer paper-based and dependent on human error, it is expected that the cost of fraudulent claims will reduce. Claims for “fake” or counterfeit products will no longer be an issue as the manufacturer or retailer can track the chain of custody of each product.
  • Increased sales: Product placement and recommendations within the app or making extended warrantees available can generate revenue.
  • Cost reduction: Efficiency in the sales and warranty claims process. Printing and printer maintenance cost will reduce.
  • Reduced carbon footprint: Consumers respond positively and reward retailers with loyalty when the retailer demonstrates awareness of and a reduction in its carbon footprint.

What are the challenges and how will the entrepeneurs respond?

  • Monetising the service: The reality is that, whilst consumers may crave the simplicity of the service, not many will be willing to pay for it. Revenue streams would need to come from manufacturers and retailers who may not see the immediate benefit to them. Emphasis should, therefore, be on creating the ability to track inventory through the entire value chain, quick validation of warrantees when claims are made and increased sales from product placements. An additional consideration is to let consumers experience the service and then implement a pay-as-you-want pricing model for people to contribute toward the service.
  • Scale of the ecosystem: There are many role-players in the value chain which complicates negotiations and, due to the highly competitive nature of the consumer goods market, open discussions are tricky to navigate. Seeking out an advisory board for the initiative that is credible in the retail sector and can offer good connections is imperative, as is an experienced negotiator.
  • Lack of trust leading to low uptake: Whilst consumers, retailers and manufacturers would all appreciate the convenience, online trust is a subjective emotion that is hard to establish for new providers. This is especially the case where a recommendation agent recommend additional products, sponsored by the manufacturer, to consumers. All sponsorships will be disclosed in addition to comments as to why the specific product is being displayed. The choice of initial partners – retailers and manufacturers – is crucial to creating trust and credibility for the service. In addition, electronic word-of-mouth references from retail-industry influencers/stalwarts will increase adoption.
  • Funding: Like all start-ups, the team are looking at different funding options for their business. One of these options is crowdfunding to see if that attracts a suitable investment without having to give up too much of the company’s equity.


The portability of the information collected through this process to other organisations – like short-term insurers and financial institutions – and the actual service to other industries – like motor-vehicle warrantees – are wide-reaching. Whilst there are many and seemingly sizeable challenges to overcome, the benefits throughout the entire value chain and the rather simplistic technical solution to realise these benefits, makes this a no-brainer.

The team of entrepreneurs in South Africa are excited to deal with the challenges and are confident that the various role-players will come together, putting the consumer at the centre, to make this possible. Look out for your electronic warrantee coming soon.


Kulkarni, A. (2018). What else could blockchain be used for? Quora. Retrieved from https://www.quora.com/What-else-could-blockchain-technology-be-used-for/answer/Ajit-Kulkarni-4 on 22 February 2019.

Van Rooyen, J. (2017). Real-world applications of blockchain-enabled supply chains. Resolve SP. Retrieved from http://pressoffice.itweb.co.za/resolvesp/PressRelease.php?StoryID=275840 on 22 February 2019.

Share, Like, Subscribe – Earn What You Deserve

Imagine writing a nice post for your friends on social media on something you have experienced that day. You put some effort in it, put in a nice quote, make a meme and post it on your social media. It turns out your friends like it so much, that they want to share it with their friends. And their friends with their friends. Before you know it your post goes viral and millions of people have liked or shared it. This off course sounds amazing, but what do you get in return? You get some likes and appreciation, but that often fades away faster than you can enjoy it. Moreover, many funny posts or memes are shared without acknowledging the maker of this post and claim it as their own. To tackle this problem, Steem, came up with a new social media platform, Steemit. Steemit believes that the users of the platform should be rewarded for their contributions to the platform. Therefore, on their platform you can earn rewards for the content that you post on the website.

How does it work?

Steem is a social network site where you can earn rewards as a publisher or as a curator. The website is developed using Steemit Blockchain technology and STEEM Cryptocurrency. The content that is written on the social media platform is written to the Steem Blockchain, where it is stored in an immutable Blockchain ledger. Users in turn get rewards for posting content or acting as curator in the form of digital tokens called Steem.

Everyday new Steem tokens are added to the so called community rewards pool by the Steem Blockchain. These Tokens are given out to users, based on the amount of votes that their content has received. Moreover, active users that have a high amount of tokens in their wallet get additional recognition by giving them so called “Steem Power”. This gives them the power to decide where a larger portion of the rewards pool is distributed too. (Steemit FAQ, 2019)

Below video gives an clear overview of how Steem voting works:

(Tomlinson, 2017)

As described above Steem tokens cannot only be rewarded by posting, but also by acting as a curator. Below there is a list of how a user can earn their digital tokens:  

  • Posting: If you post and share it with your fellow users you can earn so called upvotes. The higher the amount of upvotes you deserve, the bigger portion of the rewards pool you will get.
  • Voting and curating: If you vote for a post before it becomes popular, you can earn a curation award. The amount you will receive for curating is dependent on your amount of Steem Power.
  • Purchasing: STEEM or steem dollar tokens can be purchased on various market exchanges
  • Vesting: By Holding your tokens to get extra steem power, you can earn extra tokens as reward for holding.  

(Steemit FAQ, 2019)                                                               


This platform sounds as a dream come true for many contributors of the web, earning by simply posting or voting. However, the dream has not completely come true yet since there are some negative side effects causing the platform not to live up to its full potential. Below graph 1 shows that there is steep decrease in the amount of active users in the past month, indicating that people are no longer actively contributing to the platform. This decrease in active users can be described by the following problems.

Graph 1 – Active users per Month on Steemit (Arcange, 2019)

One of the problems Steemit recently encountered is that of the fluctuating crypto market, which can cause the valuation of the company to diminish tremendously. A few months ago, CEO Ned Scott Posted and announcement saying Steemit had to let go 70% of its employees and that they would focus on keeping the cost of infrastructure that is running Stemmit.com low (Scott, 2018). This sudden reorganization is due to the crash in cryptocurrency prices in 2018. The value of  Steem decreased from 8USD in the beginning of 2018, to only 0,30 USD at the end of the year, causing a large decrease in the cash flow of the company. (Zachary, 2018) This is off course a huge danger for the Steemit platform, being reliant on such a unreliable currency.

Other problems are more related to the set-up of the platform. By giving extra power to users that have a high amount of Steem tokens, you create so called whales that have total control of the platform. (Masters, 2018) They have more voting power and power over the division of the Reward Pool, and thus have high control over what gets rewarded. This makes it extremely hard for new users to enter to platform and gain a substantive part of the payout.

Another important aspects of a platform is network effects, meaning that more users will generate more value for each other. For Steemit however, more users does not automatically generate extra value for the users, because there is also a form of competition on the platform. If more people will be part of the platform it will become harder to get large amounts of upvotes, and thus rewards. This causes the amount of reward to be spread more evenly over many contributors, making the amount of reward almost dismissible. By doing so the platform creates a trap for itself where more users actually discourages the effect of rewarding contributors.  

A side effects for this increased difficulty to get upvotes is that Voting bots have been developed. You can pay these voting bots to create additional up votes on your article, and by doing so increasing your rewards. (Masters,2018) Articles do no longer get rewarded for their quality, but are more dependent on the amount of money people are willing to invest in voting bots. This diminishes the quality of the platform, since it cause low quality articles to also reach high amount of appreciation. Moreover it  is causing prominent users to leave the platform, since it results in unfair competition (Skoll, 2018).

Steemit, Yer or No?

So, the idea of being able to earn rewards for your content sounds great but it has been shown that creating such a platform is harder than it sounds. Money always triggers a form of greediness, making people focus more on earning more rather than creating valued content. This causes cheating and collaboration which does no good for the quality of the platform. If you are still looking for a platform where you get more recognitions for you contributions, (but no money), check out Reddit. Do you really want to monetize your content you can always become an influencer on Instagram or Youtube.


Arcange. (2019). Steem Statistics – 2019.01.01. Retrieved from https://steemit.com/statistics/@arcange/steem-statistics-20190101-en

Masters, C. (2018). Losing Steem: One of the Most Active Crypto Projects Cuts Staff. Retrieved from https://cryptovest.com/news/losing-steem-one-of-the-most-active-crypto-projects-cuts-staff

Steemit FAQ. (2019). Retrieved from https://steemit.com/faq.html#Can_I_earn_digital_tokens_for_commenting

Skoll, M. (2018). Why I Left the Steem Blockchain. Retrieved from https://medium.com/@heymattsokol/why-i-left-the-steem-blockchain-bb0214a451b8

Tomlinson, S. (2017). An explanation of Steemit Voring Power – retrieved from https://www.youtube.com/watch?v=FLsPI65HzPI

Zachary. (2018). Steemit Lets Go Over 70% of Employees, Blames Bear. Retrieved from https://bitcoinnews.com/steemit-lets-go-over-70-of-employees-blames-bear/

The technical weakness of Bitcoin

Bitcoin, the coin of the people. But is it truly? Let’s first get back to how bitcoins work. The bitcoin is the first decentralized digital currency that you can send through the internet. Bitcoin goes directly from person to person, which means that the fees are much lower, you can use them in every country, your account cannot be frozen and there are no arbitrary limits. Although, this is what bitcoin promised at the launch in 2008 (WeUseCoins, 2011).

Continue reading The technical weakness of Bitcoin