AMP in focus, opening the world to crypto payments

By Austras | Crypto in focus | 5 Jan 2022

Adoption is key, more users actively using a system exposes it to more potential growth. But adoption is slow and it's hard to convince people to move away from a system they feel is already working. The key is making the transaction easier, cheaper and just as secure. If you wish to pay for food or clothes with crypto, then maybe AMP is the way to go?

Background

AMP's story begins with a different crypto, Flexacoin which launched in late 2018 and was developed by Flexa. It was built to offer instant collateralization between users, it supported this through smart contracts. Later on, towards the end of Flexacoin's life cycle in 2020 it entered into a partnership with ConsenSys to further expand upon the use case for Flexacoin. The team was unable to do this by simply adjusting the smart contract, so they built a new crypto from the ground up using new contracts. Flexacoin was rendered obsolete and holders could swap it for new AMP tokens.

After the launch of AMP in 2020 Flexacoins were able to be exchanged to AMP on 1:1 basis. The new smart contracts had a wider and more advanced use case than it's predecessor. However, the supply and tokenomics for the token itself was effectively the same as Flexacoin.

Network

What was the purpose of Flexacoin and what is the purpose of AMP? First we need to look at the purpose of crypto overall, peer-to-peer payments without the need for a middleman. Blockchains often have to sacrifice speed in place for security, which is a major issue for large retailers that need to process transactions quickly. AMP functions as collateral, giving the company or person receiving the payment access to their funds instantly while the original crypto transcation is still finalizing on the chain.

AMP is a ERC-20 token and makes use of Ethereum smart contracts to allow for instant settlements. These smart contracts can be integrated directly into existing payment systems and upon up merchants to crypto payments without any risk. The network is a cheaper and safer alternative to traditional instant settlement services, such as those used by VISA or Mastercard, making them direct competitors. The high transaction speed is maintained through a Proof-of-Stake system where AMP is staked to nodes which verify any transaction that takes place.

Use cases

The biggest use from AMP is for merchants wishing to adopt or allow for crypto payments. Using AMP mitigates the risk for fraud or chargebacks as any transaction is instantly collateralized, thus making any crypto used for payment instantly available for spending by the receiving user. This system is a faster and more secure alternative to traditional credit and debit settlement networks. Users or holders of AMP can also earn passively by helping keeping the network secure through staking.

AMP today

The token has stayed strong in its short lifespan. It aims to fill a spot in a market that is dominated by giants, but expensive giants. VISA have moved towards adopting crypto and have allowed for settlements in crypto indirectly in the past through the various cryptocurrency debit cards. Currently AMP fills a niche for users that wish to pay or accept crypto as a payment alternative, if its competitors follow suit it can have a harder time staying relevant.