The global payments landscape is rapidly transforming into a digital-first industry, with non-cash transactions expected to reach 1.1 trillion by 2023.
The onset of a global pandemic, the convenience of digital transactions, and the popularity of e-commerce and mobile payments have triggered rapid growth in digital transaction volumes.
But higher digital payments adoption comes with a multitude of risks. Fraud posing serious operational challenges to businesses and individuals alike. International trade, for one, between two parties involves the risk of fraud.
The standard practice in these trades is to engage a third-party escrow service to mitigate risks, but this adds an overhead expense of between 3% and 5% to the transaction along with additional paperwork and transfer delays.
People use escrow commonly to trade domain names, collectibles, cars, real estate, sensitive data, and the list goes on.
Individuals are also using third-party apps such as Facebook marketplace, Craiglist, or Paypal to buy and sell a wide array of products and services.
Blockchain technology offers a solution, and if you guessed it already, yes, we’re talking about how smart contracts can disrupt yet another industry.
How Escrow Smart Contracts Provide an Answer
Smart contracts are self-executing contracts containing the terms of the agreement between two parties that execute automatically as the underlying terms are met.
The inherent properties of a smart contract make it an ideal replacement for a traditional escrow service.
The involved parties can encode the terms of the agreement within a smart contract, including deliverables, payments, and relevant penalties or deductions as applicable.
As both parties satisfy the terms, such as shipping the product, inspecting the product, or delivering a service, the smart contract releases the payment automatically.
In theory, it’s the perfect solution for carrying out trustless transactions, but at an operational level, there are some challenges. First, not everyone has the technical awareness, know-how of creating a smart contract. Secondly, major blockchains, such as Ethereum, have high transaction charges and limited network throughput.
That’s where technology startups, like us from Smartlink, come into the picture.
Our Escrow Smart Contract Solution
Smartlink is an escrow smart contract protocol that aims to mitigate the risk in online transactions through smart contracts.
The platform provides a simple user interface, where the involved parties can select a smart contract template, input their terms with a simple form, and make a deposit to start the transaction.
The process doesn’t require any form of coding or technical sophistication. Smartlink provides a platform for businesses as well as retail transactions with its easy-to-implement escrow module.
Smartlink is built on Tezos, one of the most secure operational blockchain networks, which allows it to lower transaction charges whilst offering institutional-grade, formally verifiable smart contracts.
Smartlink proposes an entire ecosystem of services based on its escrow smart contract module: Decentralized marketplace Launchpad Decentralized exchange built on Tezos.
Smartlink concluded the public sale of its token, $SMAK, in May 2021, raising $3 million in private and public rounds, followed by token distribution in June and token-staking in July. Smartlink has also partnered with Pyratzlabs to develop a new DEX on Tezos.
The platform is set to roll out its first module, a decentralized launchpad in September/October, with other components being released in the subsequent months.
The escrow industry offers huge opportunities for technology startups.
Smartlink holds the potential to make its mark in the industry with its blockchain-based platform.