This past weekend I went to Startup Weekend. We ended up doing my idea which was a way to buy people in need a meal at a local restaurant. Late Saturday night we pivoted to a more general concept of electronic gift cards.
The main difference being you get the money back when it expires. The use case that came up most often was wanting to provide money for children at college.
I’ve been thinking about the different ways the wealth transfer could work. I’m particularly interested in how it would be accomplished with bitcoins. So far I’ve got four scenarios. The players are the giver, the recipient and the vendor.
- The giver gives to the receiver with the agreement that funds from that address will only be transferred to a specific list of addresses. The company would sign up online and register an address. This is a situation where the address verification through postcards might be useful. It isn’t possible to control how the receiver spends, but the giver will know and it can be marked as a violation.
- The giver gives to the company in an account that is designated as for the recipient. The recipient would need to identify themselves to get the money. One suggestion from the weekend was taking a picture of some distinctive object that they own. They then show the object to prove their identity.
- The giver transfers to a bank which holds the money then transfers it to the vendor when the recipient makes a purchase. It removes the responsibility from managing the accounts from the vendor. It also allows a gift to be used at multiple vendors.
- The receiver requests money from the giver who then transfers it to the vendor. This requires action by the giver as part of the payment process or an agent making payments on their behalf. This is the model bartab uses where a credit card is kept on file and charged when a purchase is made.
I like the direct giving because of the control it gives to the receiver, but I think #3 is likely the way to go. This means setting up a bank of some sort.