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Blockchain has hurdles to jump before being suitable, large scale fraud prevention solution

Tony Zerucha

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Among the problems established financial services companies are looking to the blockchain to solve is the issue of card skimming at ATMs and other points of sale which is estimated to pilfer $2 billion each year.

MasterCard is developing a public blockchain they believe will address this by encoding a payment card’s image onto a blockchain before encrypting it with public and private keys. When a payment is made the system will access the private keys to decrypt the card image so the payment can be processed.

The concept is a noble one which faces some possible stumbling blocks on the road to maximizing its potential, Arran Stewart believes. Mr. Stewart is the co-owner of Job.com, a blockchain-based recruitment platform employing blockchain technology to improve the efficiency of the job recruitment process. Through technology, Job.com reduces the hiring company’s cost to six per cent of the starting salary, with five of that six per cent provided to the successful candidate as a signing bonus after 90 days.

Arran Stewart

“I am interested to see how the vast amount of information will be publicly stored on the blockchain,” Mr. Stewart began. “We’re talking about millions of blocks.”

That amount of information can bog systems down and slow transaction speed, which is a deal killer in financial services. Effective systems need to quickly correlate information in order to verify transactions, and at the high volume required by companies like MasterCard industries are struggling to scale solutions which initially showed promise.

“There are a lot more challenges to face, but the technology isn’t there in my opinion,” Mr. Stewart said. “But it will get there.”

Job.com just completed their pre-ICO period with encouraging signs. While most ICOs pitch a dream, Job.com has an established concept and track record of success. Established 20 years ago, Job.com said it has registered 60 million clients in the United States. It has existing clients and revenue streams, and operates five offices around the world.

Technology enables his company to offer an attractive value proposition, Mr. Stewart said.

“Normally staffing agencies charge a percentage of a candidate’s salary. We are looking at how to utilize existing technologies and pair them with the blockchain to replace the human element.”

The process begins like any other, with candidates sending in their resumes and companies submitting job vacancies, But then the technology takes over, as technology produces matches for vacancies, while maintaining applicant privacy. The company then contacts candidates to arrange interviews.

Then blockchain and ERC20 smart contract technology take over by rewarding interviewees with tokens, listing contract stipulations, and paying agreed upon fees to all parties. At the end of the 90 days, and only then, does the company pay anything, Mr. Stewart said.

“If the company hires, they don’t spend a penny. If they keep the the employee for 90 days we charge six per cent. With the industry average fee at 20 per cent, it means we are massively cheaper than what’s out there.”

The reward tokens incentivize candidates to stay in touch with Job.com and promote it within their groups, Mr. Stewart explained. When someone gets a friend to sign up, they earn tokens. Get a company to sign up, earn tokens.

“It’s a fluid ecosystem where we’re rewarding people for providing the right information for the job and companies for putting the right job in front of the right person,” Mr. Stewart said.

“We’re in the digital economy where everybody becomes the recruiter.”

The material is not to be construed as an offer or a recommendation to buy or sell a security. See full Terms of Service.

Tony Zerucha

Tony Zerucha is an alternative finance journalist with more than seven years experience in the space. The author of more than 1,000 articles, Tony was named LendIt's 2018 Journalist of the Year.

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