This is a guest post provided by the Bytecoin PR team.
In the beginning of October, the new direction of Bytecoin development has been revealed - it concentrates on supporting donations based businesses and charitable foundations.
Bytecoin here acts as a platform where all hard work is performed inside. The goal of this approach is to be as simple for users as Facebook’s ‘Like’ button. The proposed solution supports micro-donations, allows support of selected projects on a regular basis and is fee-free.
Bytecoin started on the 4th of July 2012 and is based on the CryptoNote technology. The creators of the currency defined its main goal as ensuring user privacy while keeping the currency transparent. Bytecoin’s blockchain is a public ledger but it is impossible to analyse it further to discover senders and receivers of funds.
Among many features of the currency, Bytecoin is ASIC-resistance, has a smooth decrease of block-reward and an increase of maximum block size over time.
The operating principle of the donations mechanism is based on redistributing change. A situation when one user can gather an exact amount of money to transfer to another is almost impossible. Therefore, normal transaction includes not only transferring money from one account to another but also returning change back to the sender’s account as well.
However, part of this change can be sent to an account of some charitable society, band or open-source software developers. The amount of change is not limited, so donations can be as small as one could imagine and allows for performing micro-donations. Also, as we there is no separate transaction for donation, there will be no additional fee.
The sender only needs to state his preferences once and can send donations as a percentage of any transaction or block reward. The maximum percentage that can be donated is set, though.
The receiver of the donation can be selected from a list. Projects that are in need of additional funding should aim to be added to as many lists of different users as possible.
This could be done with the help of a special link, which can be published anywhere on the Internet. After clicking it, the Bytecoin Wallet will automatically process it and add new receiver to the list.
For instance, a link to the CoinGecko wallet will look as follow:
To support the project, it is enough to launch the Bytecoin Wallet and click the link.
One of the inspirators of Bytecoin, Pacific, describes the donations business model as follow:
“We strive for simplifying and automating routine tasks. And the main step for this is removing unnecessary arbitrators. For instance, to donate to the project of saving rhinos without any arbitrators, we have to go to an office of the charitable organization and give them cash. Any other option implies using some broker, be it a bank, cellular network operator or payment processor. Donating via Bytecoin is the same as going to an office with a pack of dollars. Only you don’t have to go anywhere.”
Many people use a donations-based business model and they are not necessarily charitable societies like the Red Cross. Educational projects like Wikipedia, software projects like Tor, musicians, artists and writers can share their works with the world for donations instead of selling them.
Small projects often find it difficult to raise funds by traditional methods due to difficulties with implementation, fees and large minimal amount of transaction. However, now it comes down to publishing a link on a site or in a social network. On the other hand, users that were previously stopped by large minimal amount can now support their favorite projects with any amount they deem acceptable.
As for the addresses, there is a difference between 10 users donating $100 each and 1000 users donating $1 each. Despite the fact that he receives $1000 as a result, a large number of small transactions is statistically predictable, while small number of large transactions cannot be foreseen.
This approach which uses the open Bytecoin platform as a basis for donations allows for the expansion of donations significantly. Users are accustomed to showing their support via Likes and Retweets. Imagine that instead of getting a million ‘Likes’ a project receives a million $0.10 donation. People can now provide financial support in addition to expressing their feelings through ‘Likes’ and sharing!