Rewards/Points System on the Blockchain?

[Abiky]

I've seen many retailers and restaurants offering rewards to their customers in the form of points. Those same points can be redeemed anytime for an item of your choice. Or simply apply them as a discount for your next purchase. All of this is built on top of traditional centralized infrastructure. But what if companies put a points system built on top of a Blockchain instead? Wouldn't it be better?

I mean, crypto/Blockchain tech is very popular these days. Why isn't this a thing? Could it be skepticism? Or fear from getting scrutinized by the government?

Your input would be greatly appreciated. Thank you.

[shinratensei_]

Last time I see this kind of reward program is from Nansen, they offered discount codes and hardware wallets. Other projects, not so much possibly because regulatory risk that could trigger AML and money transmission rules, sounds like a pain in the ass, although honestly these standard loyalty points usually exempt from such rules if done right.

Moreover, it's not like many crypto projects aren't known to exclude several countries with geo-blocking because not including them is cheaper, legality wise. Less top lawyer to hire.

[Exitoral]

Well, restaurants want to retain their customers to keep on buying. It's not like there's a bigger reward if you keep buying. The customers are actually spending money and it's beneficial to both the business and the customers. Let's look at Blockchain. It already has and still having more and more individuals and institutions joining. It's not like Bitcoin wants to retain customers or something. Except centralised platform wants to do it, but thinking about it what will one actually spend those points on that will be beneficial to both the platform and the individuals. I don't see any. Moreover there's gas fees that will make that impossible. Hope I am making sense?

Come to look at it properly, it's not like gold offers point for preservation of your wealth. And if we compare Bitcoin to gold because of it's immerse value, you can see it's impractical to offer points.

[Korvane.io]

I've seen many retailers and restaurants offering rewards to their customers in the form of points. Those same points can be redeemed anytime for an item of your choice. Or simply apply them as a discount for your next purchase. All of this is built on top of traditional centralized infrastructure. But what if companies put a points system built on top of a Blockchain instead? Wouldn't it be better?

I mean, crypto/Blockchain tech is very popular these days. Why isn't this a thing? Could it be skepticism? Or fear from getting scrutinized by the government?

Your input would be greatly appreciated. Thank you.

Blockchain-based points can make sense, but only if the reward system is connected to real value creation.

The technology itself does not solve sustainability. If points or rewards are created only through new token emissions, hype, or unsupported incentives, then it becomes the same problem we see in many crypto projects: rewards without a real economic source.

A good rewards system should be backed by actual business activity, revenue, customer loyalty, or productive demand. Otherwise, blockchain only makes the system more visible, not more sustainable.

Best regards,

The Architect

[MAAManda]

I mean, crypto/Blockchain tech is very popular these days. Why isn't this a thing? Could it be skepticism? Or fear from getting scrutinized by the government?

For sure that's a thing, a few years ago, I came across projects such as blockchain-based loyalty programs, but I’ve forgotten their names. Since I haven't seen anything about it anymore, I assume those projects have now been abandoned, possibly due to low adoption rates or similar reasons.

When it comes to regulations, they also pose a hurdle for such projects, particularly in countries that don't permit Bitcoin (BTC) or cryptocurrency in general to be used as a means of payment. Our country (Indonesia) is one of them.

[noorman0]

Blockchain data can serve as a reference base, but because it's immutable and doesn't provide much specific information, the point system should be implemented semi-centrally. The problem is, the point system itself can be flawed and vulnerable to abuse in some cases.

We often see incentive programs from startup projects that ultimately implement KYC to prevent Sybil accounts.

[The Cryptovator]

I've seen many retailers and restaurants offering rewards to their customers in the form of points. Those same points can be redeemed anytime for an item of your choice. Or simply apply them as a discount for your next purchase. All of this is built on top of traditional centralized infrastructure. But what if companies put a points system built on top of a Blockchain instead? Wouldn't it be better?

I mean, crypto/Blockchain tech is very popular these days. Why isn't this a thing? Could it be skepticism? Or fear from getting scrutinized by the government?

Your input would be greatly appreciated. Thank you.

In my country also, various companies offer a reward or point system. But for the blockchain, sound seems unrealistic to me. In the retail shops or in restaurants, we are paying bills, not the service charge. On the blockchain we are paying fees; it's not a bill for purchasing something. So both can't be compared anyway since they're different industries.

If you want to implement something like this, then who will pay the rewards? Either it should be given by companies or miners. On the existing blockchain, it's quite impossible, like Bitcoin, without any hard fork. And for the new projects, it will be hard to implement; it won't be easy since something needs to pay, no matter the form of rewards or points. Also, it doesn't make sense that people will move to such a reward system by leaving existing coins.

[nelson4lov]

We have had points programs in crypto. Several hundreds if not thousands of those in crypto but mainly for airdrop and post airdrop and imo, it was a failed concept because it is good to give back to users when they don't know there is a reward. I think what made crypto rewards or points program failed was because since people knew the details and rewards of these programs, they simply came up with efficient ways to game the system. And when the rewards are out, they simply move on to the next best reward/points program and milk it out.

[o48o]

I've seen many retailers and restaurants offering rewards to their customers in the form of points. Those same points can be redeemed anytime for an item of your choice. Or simply apply them as a discount for your next purchase. All of this is built on top of traditional centralized infrastructure. But what if companies put a points system built on top of a Blockchain instead? Wouldn't it be better?

I mean, crypto/Blockchain tech is very popular these days. Why isn't this a thing? Could it be skepticism? Or fear from getting scrutinized by the government?

Your input would be greatly appreciated. Thank you.

Why would it be better? It wouldn't be, but better question is that what's that blockchain for? What would it solve?

Are you afraid that someone is hacking the centralized server and steal your points? Because centralized server could just reward them you back as it's not some permissionless system like blockchain. If for some reason points would be  non-custodial wallet, you would just be worse off, as that's just a reason to abuse them.

If you are afraid that shop or government is freezing your points, then how would blockchain protect you? It would be your account that they have a beef with, not with your wallet, because none of these systems are anonymous that i know of.

Centralized service is faster, easier and more flexible.

Edit: Also, as a side note, user Korvane.io (The Architect) is clearly using AI to write responses, as that answer is clean, well structured, but has no substance and makes zero sense in this context.

[jossiel]

But what if companies put a points system built on top of a Blockchain instead? Wouldn't it be better?

I don't think there's a huge difference between the two systems. What both consumers and companies are only concerned of if it works for them.

For companies, I don't think that they'll do some changes if their rewards or points system are working unless the owners are blockchain enthusiasts.

[Iranus]

I've seen many retailers and restaurants offering rewards to their customers in the form of points. Those same points can be redeemed anytime for an item of your choice. Or simply apply them as a discount for your next purchase. All of this is built on top of traditional centralized infrastructure. But what if companies put a points system built on top of a Blockchain instead? Wouldn't it be better?

Do all loyalty programs really need blockchain?
You know, many companiy might just throw in the word blockchain because it sound innovative.
If a centralized database can do same thing cheaply, quickly and easily then where is the real need to use blockchain?

And why would companies open up their closed ecosystem? See, with the current point system they are better able to store and control customer data. In some places fear of government or regulation vould also create obstacle.