Back to Basic: Zero-Cost, Permission-Free Benefits Through Off-Chain NFTs

One of the keys to building the next generation internet around personal ownership and data is permissionlessness.

Written by: Starzq and Ruby Wang

The recent market has caused many builders and VCs to ask "What else can Web3 do besides speculation?"

Back to Basics, the core of Web3 has always been about ownership, building the next-generation Internet around personal ownership and data, and one of the key features is Permissionless (no permission required).

In the financial field, smart contracts have realized Permissionless Issuance, and Uniswap has pioneered Permissionless Trading; in the consumption field with a larger user scale, many projects and brands are exploring Permissionless Perks, establishing user-side integrated permissionless benefits, including the well-known Web3 Native IP BAYC and Azuki, and Web2 consumer brands Starbucks, Adidas and Nike.

In the already opened summer conference season, if you go to an offline web3 gathering, whether it is an NFT community event or a developer conference, you can already start to unlock such a flexible and efficient user-side integration experience. At the same time, we can also feel that besides being used as a transaction target, Token has another possibility in real life and consumption application scenarios.

1. Background

When the last wave of users with strong financial attributes entered, it was acceptable to create a decentralized wallet and on-chain. After all, account opening and KYC in the Web2 world are more cumbersome.

To achieve Mass Adoption in Web3, consumer users are definitely the main force. But for users with consumption attributes, the usage cost in the Web2 world is close to 0. When coming to Web3, a wallet is required to store user identities and assets. Is such "expensive" user interaction and on-chain really necessary?

We break it down into 3 questions👇

1. What are the benefits of Web3 for users who consume attributes?
2. Which parts can not be chained?
3. When does it need to be on-chain?

On this issue, the 7-year-old Smart Token Labs (hereinafter referred to as STL) has been exploring and gave its own answer:

1. Web3 can truly realize user-side integration, build a privileged platform around its own ownership and identity, and open up a larger Open Loyalty space for brands
2. For the verification of the usage scenarios of rights and interests, it can be solved off-chain: using cryptography technology such as attestation to realize tokenization under the chain and lower the threshold for users to use
3. When to go to the chain: wait until the rights or assets need to be used for transfer before going to the chain.

Based on these three answers, Smart Token Labs has created a set of Smart Layers that integrate off-chain and on-chain, so that users do not need to open a wallet or consume gas, and can obtain rights based on specific identities by verifying the NFT off-chain through the URL. The brand has opened up a larger Open Loyalty space.

For example, this week, at the Ethereum EDCON 2023 held in Montenegro from 5.19 to 5.23, the audience can experience that the organization team cooperates with STL to provide permission-free benefits. Through independent verification of ticket ownership, audiences can receive various privileges provided by third parties on the conference official website platform and offline.

Two, Open Loyalty and client integration

What is Client Integration

The concept of "integration" is believed to be familiar to those who understand brand members or Internet platform client services. For example, in an e-commerce website, the introduction of third-party payment services allows users to complete payment directly on the website, which is called "third-party integration".

In the Web2 or traditional business world, this integration is mainly achieved through third-party APIs, while user data and permissions are stored in centralized servers. The biggest obstacle here is that limited by development and business capabilities, there are only a handful of brands that can develop and access APIs, and users have limited choices, as well as data privacy issues.

The web3 client integration method is to process the user information originally closed in the centralized database into a cryptographic token that the user can control and use, and then use the token as an integration point to access various third-party services.

Still take EDCON as an example: a user purchased a ticket, and this information was originally enclosed in the EDCON ticket system database; now STL processes this information into an attestation token (Attestation token) and gives it to the user. Functions that originally required the integration of EDCON ticketing system and many third parties can now be easily realized. The user can prove to all conference peripheral service providers that he is an EDCON ticket purchaser to obtain corresponding rights, and only choose the appropriate service provider according to his own needs, without worrying about the leakage of contact data such as mailboxes.

User-side integration truly makes users the center and builds a privileged platform around their own ownership and identity.

How to implement Open Loyalty

"My members get cool stuff because you can treat them like your own members"

—— STL CMO Brent Annells

Tokenization enables the proof of assets (equity) to be completed by the user itself without the participation of the original issuer. Brand A can verify the user's assets (equity) in brand B without the participation of brand B, eliminating the need for a Brand negotiation and cooperation, system docking data exchange and other steps. @Starzq also mentioned before that when member data is uploaded to the chain, there will be a business paradigm shift. The method for brands to acquire users will change from pull to push, and the value will return to users. At the same time, brands need to learn new ways to communicate with users.

For Open Loyalty, you can refer to three interesting cases mentioned in another article of web3brand: The next new narrative in the NFT market: Open Loyalty

Such a paradigm shift is especially applicable to event & ticketing scenarios as well:

Since the users who participate in EDCON are not only the core blockchain builders but also will stay and consume in Montenegro, the exhibitors, VCs and catering establishments in Montenegro can all give users Corresponding benefits and rights to accurately attract users.

"At least 25 perks will be available to attendees, from free minting power for Cool Cat, a spin-off around EDCON, to the chance to get 50 'Njegusi Prosciutto' from one of the famous local Montenegrin restaurants." EDCON Co-Host, Ether Sky Harris, head of marketing at Square University, sees "permission-free perks" as a great way to create added value for attendees.

Client Integration + Open Membership System = Permission-Free Benefits

Therefore, based on the Permissionless Perks, a welfare platform for participants deployed by this STL, users can freely use their own verifiable information, and directly contact the welfare provider without going through a "middleman" to improve the participant experience; while brands and service providers Attract accurate users (verified participants) and create value for them, and at the same time greatly reduce the burden of communication and docking cooperation for event organizers, and improve communication efficiency.

Referring to the experience of the last Devcon in Bogota, Permission Perks made the engagement rate 58%, twice the industry average.

3. The experience path of the welfare platform without permission

I tried to read the experiences of all parties, and they are quite concise and clear.

If you are a participant

Attendees will receive proof of their ticket via EDCON email in the form of a URL that directs attendees to a permissionless benefit page, no need to log in or connect to a wallet, or go directly to the official website where they can browse and claim their tickets from VC Priority to contact the project party Merch and other rights and interests. It's a bit like taking a participation card to check in at each offline booth at an exhibition, and now the seamless online experience is completed.

At the same time, you can refer to this Twitter🧵 to learn more: Token by Smart Token Labs on Twitter

Some examples of redeemable perks: from NFT, merch to VC

If you are the event organizer

Collaboration becomes very simple, because any third party can add value to the meeting by connecting the "permission-free benefits" platform itself to provide benefits to event participants; the organizer does not need to connect with multi-terminal data, and can quickly Create a marketplace of services based on the unique identity of members. At the same time, the Token that proves ticket ownership is stored in the local browser to achieve seamless integration with the EDCON welfare provider website. Verification happens between the ticket holder and the benefit provider without involving the event organizer, and benefits can be long-term.

The "Permissionless Welfare" platform plans to connect about 12,000 participants through cooperation with the Ethereum conference in 23-24.

4. Imaginings on future event organization and distribution of brand rights

Although it is still in the early stage, I believe that the experience and efficiency improvements brought about by client integration and Open Loyalty will gradually penetrate into event organization and daily consumption. To sum up my three thoughts on the trend:

No matter how small a brand or an individual can build their own ecosystem

Originally, a certain amount of technical resources was required for large companies to connect with multiple parties to realize the membership benefit platform. The current solution is enough to make it possible for individual creators or independent brands to operate core users. With the maturity of tools, more business operators (brands, creators, event organizers) need to be onboard. After all, the relationship in the future will be based more on the direct contact between operators and users in order to improve the overall consumer experience.

I also mentioned in the previous ticketing case of the A7X band that creators control the experience for fans and community operations are the keys to success

This week, the well-known cricket player Glenn Maxwell also issued membership tokens to his fans through the cooperation of STL, which can be received without registering a Crypto wallet, so as to better operate his fan community.

Actively engaged users will reap real value

With the accumulation of data, the way for brands to acquire customers in the future will gradually shift from placing advertisements on intermediary platforms to directly rewarding participation, so as to find real users more accurately. User-side integration enables users to define and prove their identity value through their own assets, data and actions, and obtain more privileges through seamless scene connection.

Tokenization creates an open service & equity market

STL CEO Victor Zhang believes that tokenization can efficiently create two markets, one is the token ownership trading market, which makes transaction flow more efficient; the other is an open integrated service market, allowing products and service providers to compete in a free market ( No longer limited by large integrated platforms or other original producers of user data, they need to provide services based on verifiable data in the form of tokens in the hands of users themselves) have the opportunity to provide users with better products and services through innovation Serve.

It is expected that through the open service rights market, web3 will truly enter the consumption and offline scenarios, creating more sustainable user value.