ICO Spotlight: Interview with Jason J. Kim, CEO of EBCoin
Coinschedule: Hi Jason, it’s nice to have you with us. EBCoin claims to revolutionize the duty-free/tourism tax industry. What was the need to do so?
Jason J. Kim: Thanks very much for having me! Yes. EBCoin will bring significant improvements to the duty-free market in a variety of ways. The first area we are focused on is the sales tax refund process. Many countries now offer tax-refunds to tourists for shopping in their country, but the process involved to get that refund is very inefficient. That was the first area where we saw that blockchain technology could solve a lot of problems.
But, we didn’t stop there. We realized that if we issue tax refunds in a tokenized form, we could just as easily accept those tokens or cryptocurrency as a payment method itself. So, it was those two fundamental concepts that got us started with EBCoin and we feel it will have a big impact on the duty-free shopping space.
Coinschedule: Tax returns are usually the job of official state representatives. What do you think would be the challenges in implementing this model for good?
Jason J. Kim: Well, obviously working with governmental entities in any part of the world presents its own challenges. However, we believe that EBCoin is offering a solution to a problem they know they already have. They are allocating millions of dollars towards offering these tax-free incentives, but these programs are not having the full effect they can. Either the refunds aren’t being claimed in the first place, or there’s a large portion going into the high fees that the third-party agencies charge to issue the refunds.
We’ve already done what we’d call a “soft pitch” to the relevant government officials and the response so far has been very positive, so we really don’t expect this to be an insurmountable obstacle for our project. In addition to that, in each country we are partnering with local FOREX companies and local payment gateway providers, so implementing our solution will also generate more revenue for local businesses, which is an added plus point.
Coinschedule: What were the 3 main problems in the current tax refund system that made you work on this idea?
Jason J. Kim: Well, let’s see if I can keep it to 3, there are many! Everybody loves the idea of paying no taxes on duty-free shopping, but the actual process involved to get those tax refunds is very cumbersome, so that would be problem number 1. Tourists have to wait in long lines at the airport, present paper receipts to customs, pay high fees and then get their refund in a foreign currency that they have to exchange for a fee again anyway.
Problem number 2 is that it’s estimated that only 37% of the available tax refunds are actually being claimed, which is a big loss for tourists, but also for the governments sponsoring these programs. At the moment about $24 billion a year is lost because of these inefficiencies, so there is a lot of incentive from the government’s side to get this process right.
Problem number 3 involves the merchants. Currently, the payment gateway processing fees they have to pay for duty-free transactions are very, very high. So, many retailers simply prefer not to offer this option, and if they do, they are operating on a small profit margin. Here too, we see the need for a change.
Coinschedule: What does EBCoin ecosystem consist of and how it will benefit the end consumer except getting rid of paper processes?
Jason J. Kim: EBCoin will automate the tax refund process by leveraging the blockchain and our EBCoin Wallet App, or DApp actually. Our solution starts at the Point-of-Sale with the payment gateway provider, so we can store the purchase information directly on the Blockchain ledger. That means you don’t need to save your receipts and customs has an immutable digital record they can reference for instant approval of qualifying purchases. Last but not least, the refund is made using our EBCoin currency directly into their EBC wallet. From there it can be instantly converted to another cryptocurrency, redeemed for fiat currency at Airport Kiosks and ATMs or they can hold on to it and use it as a payment method for future duty-free shopping.
Coinschedule: Okay, so we’ve heard a lot of news about China and South Korea banning ICOs and putting regulations on cryptocurrencies, how are you handling these two countries as your go-to-market (as per the Whitepaper)?
Jason J. Kim: Yes, we have been watching the news cycle very closely. First of all, EBC Foundation, the registered entity behind EBCoin is incorporated in Singapore. We’re proud of that because many of our key partners also are based in Singapore. Secondly, regulatory compliance is important to us because we want our project to have a long future, so we need a solid legal foundation. That’s why we’ve relied heavily on the input of our legal advisors who have helped us to stay compliant all the way through and we’ve also enlisted partners to assist us with the needed KYC/AML procedures.
As as far as Korea and China being our “go-to-market”, we feel confident that our solution will be fully compliant with the regulations of any country where we are offering our service. Of course, Chinese tourists are the biggest travel spenders in the world, but the regulatory climate in China will have little effect on the value that EBCoin will offer them. In this case, our EBC tokens will be used only as a utility token to receive the value of the tax refund in the traveler’s EBCoin Wallet while traveling abroad. From there it can be converted easily into the required fiat currency before returning home.
Coinschedule: Briefly run us through the token mechanics of EBCoin.
Jason J. Kim: EBCoin or the EBC token will be the fuel that makes our ecosystem come to life and it has a simple utility function on our platform. The tax-refunds will be issued to users in EBC token, and our token will also be accepted as a payment method at participating duty-free merchants. We have set total supply at 1.5 billion EBC, half of which we’re making available during our crowd sale. We did this to ensure ease-of-use when it comes to our token, especially when considering the size of the potential market, we wanted the numbers to make sense and not just be subfractions.
Through the EBCoin Wallet App travelers will be able to convert their EBC to other cryptocurrencies or easily redeem it for fiat currency at a Kiosk or ATM in the airport. The value of EBC will ultimately be determined by the open market of course, but as with all tokens, it will be affected most by the demand for our token as we expand our service offering to include more countries and more merchants. Not speculating here, just stating a fact!
Coinschedule: What is the reason for starting your own exchange for trading instead of using the available options?
Jason J. Kim: Good question! First of all, we will be using other exchanges, in fact, as many as possible. Since our target market is the “world traveler”, we want our token to be easily accessible to anyone in the world who would be using our platform.
The primary reason for establishing our own exchange is liquidity. For our solution to work, we need EBC to be available for users of our DApp when they need it. Whether they require more EBC for refunds that are issued or need to exchange EBC for other cryptocurrencies, by funneling the transactions from our Wallet App through our own exchange it ensures that we will always have sufficient volume.
Coinschedule: Would you like to tell us about dates and other details of the token sale and soft/hard cap?
Jason J. Kim: Yes! With pleasure. We are at quite a late stage in our token sale. We started with our pre-sale in December and we’re actually now in what we’ve called Phase II of our main token sale. It ends on 13 February, so hurry up and don’t miss it!
The minimum contribution is 0.2 ETH. Our soft-cap was set at 3,000 ETH, but I’m happy to say we blasted right by that since we’ve already raised almost 9,000 ETH! Our hard cap was set in EBC tokens since we really want to sell out, so in total that is 750,000,000 EBC. That means that at this point, with what we have left our effective hard cap, or max cap, is just over 33,000 ETH.
Coinschedule: Our readers will also be interested to know the brains behind this revolutionary idea.
Jason J. Kim: Ha ha. Yes, well, we have a whole team of excellent brains behind this project. Our development team have been working together for years and are second to none. We’ve also had some great advisors helping us along. But, as far as the initial concept is concerned, this is something I’ve been dreaming about for a while now, so I’m just glad I can get the chance to see it actually happening and turning into a real solution that has a lot of people excited.
Coinschedule: Any exciting partnerships that you’re proud of or looking forward to?
Jason J. Kim: Yes! I wish I could tell you about all of them, but unfortunately, some of the big ones are confidential at this point until they are fully confirmed. We already have two confirmed MOU’s that have been concluded with payment gateway providers, mPOS in Vietnam and MC Payments in Singapore. Of course, we have also confirmed contracts with KR Partners and GCMC in Korea. But, as I said, that is just the start, we have some big announcements coming up in the next few weeks that we’re really excited about and we’re sure our community will be just as excited to hear about it. Our team is working really hard and I’m sure everyone will be happy with the results.
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