Amaten to use blockchain to expand Japanese gift card exchange
Japan’s largest gift card exchange platform, Amaten, is expanding its current operations using blockchain in partnership with the decentralized cloud computing network and smart contract provider aelf.
Amaten’s move to leverage blockchain technology will be to enable the company to expand its existing business not only in Japan, but also overseas, with initial plans to expand into Chinese and Korean markets. Amaten was founded in 2012 as a secondary gift card exchange program and has grown to $110 million in revenue, which according to Amaten represents 40% of the exchange volume in Japan.
"We have chosen to partner with the best blockchain technology providers in the space, aelf, because they offer the scalability, dedicated sidechains and smart contract modules that we very much need to build our service rapidly and most cost effectively. We are wholeheartedly excited for the future of truly digitized gift card industry,” Tom Kanazawa, Amaten's chairman, said in a press release.
The desire to adopt blockchain technology is partly in recognition of the fact that the global gift card industry is moving to a digital format from a physical card format. It is also aimed at offering existing physical gift card issuers an alternative to the common digital format that uses codes sent via email or text that are highly susceptible to malicious attacks by digital thieves.
Using aelf’s technology, Amaten will be able to onboard and convert traditional gift card forms, both physical card and digital email code-based cards into digital assets managed and exchanged on its blockchain. This is expected to deliver a higher level of transparency and traceability to the original gift card issuer and in any secondary exchanges between the end users.
The blockchain work between aelf and Amaten is already underway although no final launch date has been announced. "Through the partnership with Amaten, we are hoping to pioneer the adoption of blockchain solutions within the traditional industries," Zhuling Chen, a co-founder of aelf and its COO, said in the release.
While the adoption of blockchain by Amaten is relatively new, there are a number of other companies seeking to leverage the technology to improve speed, cost efficiency and transparency. Last December the cross-border gift card company Swych announced it was transitioning a blockchain platform from the Stellar Network in several phases over the next year.
Amaten offers peer-to-peer exchanges of 26 types of gift cards including from Google, iTunes, Amazon, Rakuten, Netflix, Playstation and Nintendo to its 240,000-strong customer base. Last year, Amaten processed almost 1 million gift card exchange transactions on its network from 132,000 active users.