LIVE NOW

The cryptocurrency markets are hungry for something real

Andrew Munro 3 December 2018 NEWS

The most valuable thing a crypto project can have is actual users. It's so valuable because it's so rare.

Grace Wong and William Wong, Liven co-founders and CMO and CEO respectively, remember the heady cryptocurrency days of about a year ago. At the time you couldn't walk into a conference without someone promising a world changing smart contract platform or describing how their project would be "banking the unbanked", usually in those exact words.

The key questions in the space were how to best re-invent money, how cryptocurrency could save the global economy and how to usher in a new golden age of blockchain ecumenicism.

The team at Liven (LVN) were occupied with loftier goals though. They were trying to get people discounts of up to 30% at restaurants.



After half an hour they ask us "Do you have an app?" And we're like... dude."

The restaurant rewards program didn't garner too much attention at the time, William notes. In that speculative and ephemeral blockchain world, explanations tended to be received as pitches and it often went without saying that everything was still hypothetical.

There was something just plain tough about describing an actual real live and already commercially viable cryptocurrency application.

"Whenever we'd come across some guys and say "we are the ones executing something real," people, it's taking them quite a while to understand that," William says. "We find it interesting that after half an hour they ask us "do you have an app?" And we're like... dude."

"A lot of projects promise the world, but don't understand having an actual live product that runs," Grace agrees.

And by the numbers Liven isn't just running. It's sprinting, with thousands of merchants and 350,000 active users. In terms of actual usage this puts it well into the top fraction of a top fraction of a percent of all crypto apps. For some perspective, dappradar is showing only 55,000 active users in the last 24 hours for all Ethereum, EOS and Tron dapps combined. And if you remove the games and gambling apps from those numbers you lose at least 95% of that.

One of the main problems for cryptocurrencies is gaining real, actual users and creating something that people want to use, and Liven has succeeded wildly on that front. The founders attribute this largely to starting with a viable business plan, launching it and getting users, and then adding cryptocurrency in a deliberate and practical way later.

Liven the dream

"If you want to set up an incredible blockchain project you need to think about the business as well," William explains. "The challenge is people realising that there's this whole new movement, that the next wave of blockchain businesses must come with a real business... not just technical progress and infrastructure level."

"I think we are getting better than 3 or 4 months ago," he adds. "The last month and a half we are starting to hear a lot of news everywhere, people are starting to realise that building a real business is important."

And it might be especially important if you ever want to achieve that goal of mass adoption.

"So many crypto projects have struggled to deliver their vision," Grace notes. "The hardest part isn't about raising money, but building a team around the tech and the business idea, and actually delivering a business idea that can get traction and build mass adoption."

Its usefulness aside, one of the key factors behind Liven's decision to integrate cryptocurrency, Grace says, was that it already had a solid and working business model.

Something for everyone

The idea of Liven is simple. You download the app and you use it to pay for food when eating out. When you do, you get free money that that can be redeemed for more food.

The benefits for merchants – the thousands of restaurants which have already signed up – are that they get to attract more repeat customers which they might not get otherwise. For them it's a timely way of implementing a customer loyalty program where it's needed most, targeted at the demographic (those industry-killing millenials) that have now turned their sights on the eating-out restaurant industry by embracing disruptive concepts like Uber Eats, Deliveroo, home cooking and having a shrinking actual income relative to the cost of living.

"The value proposition for the restaurants is basically in times like now, with tech disruptors like Uber Eats or Deliveroo," Grace explains. "All these guys have been in the market about 3 years. While it's great technology and it does bring a lot of convenience to the millennials, it sort of kills the hospitality industry in the sense that restaurants are getting emptier and emptier, and more food is getting delivered."

"Restaurants are looking at ways to attract millenials to come back into their venue, and they want to find quality customers and long term customers who will come back if they give good service."

The Liven app handles the payments end to end, it engages users with notifications which might be favourite daily specials, additional discounts and other useful things and it provides something of a dashboard for restaurants to get information on how to better cater to its customers.

"There's no one in Australia doing the payment experience the way we do, and also we focus on hospitality for now so all our users are the kind of people who go out 3 or more times per week. These are the kinds of people the restaurants target, and want to keep coming back."

You certainly don't have to be a chronic restaurant-goer to get the benefits though. As a cryptocurrency reward you can use your Liven LVN tokens however you want. You can pool them among your group, gift them to someone, donate them to charity or straight up sell them. It's a completely different beast to the more traditional "every tenth meal is free" loyalty cards.

It's also much more suitable for higher-end establishments where dog-eared rewards cards aren't really appropriate, and where the expectations for service are much higher. Even here, the Liven app is designed to add fluidity to the experience.

"We also work with a number of really top level restaurants, because our focus is one customer experience," Grace says. "So, we tend to have the customers who care about the whole customer journey. They go to nice restaurants and the last thing they want to do is this lining up. They just click a button and walk out and they hear a ding. And they earn really nice rewards."

This flexibility helps Liven satisfy a much wider potential audience across a much wider range of industries. You can earn the corresponding LVN when you stop for gelato, or when you go for a full banquet, and see your wallet balance grow before your eyes.

"We keep them coming back to the venues... and all these people earn all this money in their wallet," Grace says.

And it really is money. The LVN in one's app wallet is denominated in both tokens and its corresponding AUD price, which can then be redeemed for meals. It's not a static price either, and app users can feel the rush of seeing the value of their LVN change over time.

"We are very focused on payment experience from the beginning to the end. We focus on customer journey and customer experience as the key element of what we do," Grace says. "We make it easy for people to find where they want to go. Payment is in one quick button, they get paid for it, and rewarded for doing what they were already going to do."

It's been a winning win-win formula so far, even before Liven introduced cryptocurrency.

Liven it up

In a nutshell, for Liven the benefits of crypto include:

  • The same token can be seamlessly used internationally, and automatically (to the user, at least) converted into the local currency at the point of sale. This means travellers can benefit more from the app, and it's easier to roll out in new countries. It might also reduce a lot of the banking headaches and cut costs to allow more room for rewarding users.
  • It puts control of the token in the hands of users. They can choose what they want to do with it, which accommodates a much wider range of dining styles than typical reward programs. For example, people can just split the bill however they want by sending LVN tokens right there and then, and someone who eats out once a month can benefit, as can someone who eats out three times a week. The token is already seeing considerable use as a P2P payment token, Grace notes.
  • It's programmable money, which can greatly reduce frictions down the line. Consider how a restaurant might automatically update the current price of the lobster (or whatever) in their Liven menu to reflect the day's market prices, or transparently divide tips, and so on.
  • It allows Liven to more easily integrate payment directly into the app rather than either becoming its own payment app or leaning on third parties like PayPal which might charge their own fees and disrupt the experience.
  • It allows smart contracts to interface with the token and make the entire process more automated, while allowing for more sophisticated rewards systems.

Grace and William serendipitously crossed paths with blockchain a few times before it became a mainstay of the app. But even so, the plan was to build a useful app rather than a cryptocurrency. It was only when they had the users and felt ready to scale that cryptocurrency was added to the plan.

"My uni mate about 5 years ago is actually a co-founding member of Parity," Grace says. "He's been telling me about blockchain since 5 years ago, and I was curious enough to want to understand at some point. So in the beginning of Liven I did look into blockchain and crypto as something I wanted to look into and follow."

"And then I went to San Francisco two years ago with William, to raise investment and for our expansion to the US. And we met a couple of investors and advisors who told us loyalty and blockchain is the perfect use case, and you already have the users and the merchants, you should really tokenise yourself because its a natural progression... helps you grow faster."

"As P2P platform we have this chicken and egg challenge where we need to reward the users and the merchants, and we have to gain them in every city we expand to. Having our LVN cash just be valuable within our network, our expansion is limited to just our own system. But when we tokenise it, it becomes more accessible and meaningful to the rest of the world. And this makes our expansion easier, and helps us spread faster. So we got back to Australia, and interestingly our co-founders were already into blockchain for a long time... so we decided to write the whitepaper on our own, because no one can understand our own model better than us. We put together a team, and that's how we started."

Liven for the moment

William was also exploring cryptocurrency before Liven, and saw that it might be useable once the app was sufficiently developed.

"I had a computing background even before I was a lawyer," he says, "so I've always been fascinated with cryptography. In 2013 I got interested in bitcoin as a hobby, just with my co-founder. But we did talk about how we can visualise bitcoin and blockchain for our business... Ethereum, obviously, is the best supported crypto ecosystem."

juicy crypto words

Best supported, in this case, generally meant the most buildable-on.

"I think for us the biggest consideration was the availability of the developer community, accessibility of highly enthusiastic developers and the ease of launching our ICO," William said. "We did look into several other competing blockchain platforms, but every single one we looked into fell short of our expectations. I don't want to name any names, but a couple of the "Ethereum Killers" when we actually looked into it, did the deep dive, were nowhere near the sophistication of Ethereum."

"Because of the maturity we've decided to start on Etheruem. Also, one of the obvious reasons was highly developed smart contract functionality, and this becomes quite an important feature for our rewards protocol, for example."

However, in the long run, William is hoping for a much more mature platform to emerge.

"Blockchain is like dial up right now," he says. "We don't see any of he current players being the choice primary blockchain for us to use. We recognise and acknowledge that there will be many more blockchain protocol infrastructures in the future. I think its very important to remain blockchain agnostic and always be open to it."

"For us, there will be a point where we need to deal with it. Relying on external alone only takes us to a point. We will look to build our own blockchain that will be more suitable for our type of business."

For most dapps, these kinds of decisions might still be hypotheticals to ponder for later. But at the rate Liven is growing, it's a serious concern.

"One of the biggest pitfalls of Ethereum is the scalability," he notes. "We have been following the development quite closely, we are aware of the numerous solutions... serenity, sharding, plasma... but it's taking too long. I think they are talking about something like 9 months. For us, as our company grows, we will grow out of all of these capabilities of the existing blockchains available. We're not talking just about TPS, we're talking about maturity and how sophisticated smart contracts can be, and how easy they can be deployed."

Liven other day

"Based on our current trajectory, we'll be in a very different place in 9 months," William says. But of course there are still lots of unknowns.

One of them might be the elusive goal of cryptocurrency mass adoption. Liven is cracking into that challenge in a new way, with hundreds of thousands of people already using cryptocurrency without really noticing it. And that's part of the idea, Grace says. You don't need some special tech education to get free money and free food, and you don't have to knowingly interact with that slightly scary and faintly tulip-scented technology.

"Our focus is to get into mass production without so much education," she says. "As a whole it's good for the mass market to get slowly educated on cryptocurrency. It still sounds scary..."

A more discerning world might also make more realistic blockchain choices, Grace suggests, and help move the market past the hype stage and into the more realistic short-term projects which might better lay the groundwork for all that world-changing stuff.

"If people can understand the technology that blockchain brings, what blockchain technology can do - and cryptocurrency is just a medium - things will be much better for a lot of real projects."

And free money for good food is a great place to start, because a lot more people want ice cream than want to join some kind of techno revolution. This fact has left some of the most magnanimous plans looking a bit frayed. And it was a lesson that many projects had to learn the hard way.

"Now all the investors and crypto enthusiasts, they realise that for any company who wants to get into mass adoption its very challenging," William says. "It's not as simple as "we do this, people do that, we create a crypto bank and people will use it." People don't use it because they don't care and don't want to."

Liven let live

It's worked out pretty well for Liven though, because now it's standing around the ecosystem as one of the only projects that actually has a lot of real users.

"So now all these guys are trying to partner with us," Grace observes. "Even the giants want to talk to us, partner to us, and [get] access to our actual users and communities. We have cases where other coins want to also tap into our network of distribution, so when customers getting paid in LVN, they also want to give customers their coin as well."

But Liven is approaching this carefully, lest the ecosystem turn into one of the more literal examples of a shitcoin buffet. It only got this far by delivering actual value to its users, and doesn't aim to stop. If and when those new partners do join in, it will be for the purpose of driving additional value to users. Because to a certain extent, creating win-win situations is what successful tech disruption is all about.

It helps that the crypto enthusiast market is much more discerning than it used to be, Grace says, now that things have had the better part of a year to cool off.

"This year people are more educated and looking for real use cases," she says. "That's where we have all the advantages, and this year is all about how you can add utility and value, and smart tokenomy... and exchanges also love us because most of them run on fake volume. So they are constantly trying to look for real users as well... we're very confident about 2019."

In its own way, Liven's place in the cryptosphere might be a sort of industry bellwether, measuring the appetite for hearty businesses against the alternative preference to chew up and spit out overhyped coins instead. Judging by the industry interest Liven is getting based on its real user numbers, the crypto world is hungry for something real right now. In this case that happens to be food.

And it's definitely more palatable for the everyday user, especially when most people are feeling quite risk averse after years of crypto horror stories. But as the joke around the Liven offices goes, the worst thing that can happen when you use LVN is that you have to eat out.


Disclaimer: This information should not be interpreted as an endorsement of cryptocurrency or any specific provider, service or offering. It is not a recommendation to trade. Cryptocurrencies are speculative, complex and involve significant risks – they are highly volatile and sensitive to secondary activity. Performance is unpredictable and past performance is no guarantee of future performance. Consider your own circumstances, and obtain your own advice, before relying on this information. You should also verify the nature of any product or service (including its legal status and relevant regulatory requirements) and consult the relevant Regulators' websites before making any decision. Finder, or the author, may have holdings in the cryptocurrencies discussed.

Crypto explained


Latest cryptocurrency news

Picture: Shutterstock

Latest crypto guides

Ask an Expert

You are about to post a question on finder.com.au:

  • Do not enter personal information (eg. surname, phone number, bank details) as your question will be made public
  • finder.com.au is a financial comparison and information service, not a bank or product provider
  • We cannot provide you with personal advice or recommendations
  • Your answer might already be waiting – check previous questions below to see if yours has already been asked

Finder only provides general advice and factual information, so consider your own circumstances, or seek advice before you decide to act on our content. By submitting a question, you're accepting our Terms of Use, Disclaimer & Privacy Policy and Privacy & Cookies Policy.
Ask a question
Go to site