ICO Review: Treon
Treon (TXO) is an Ethereum-based blockchain network for decentralized utility payment and wallet. Their goal is to simplify the utility payment and collection process by offering a more comprehensive and efficient payment gateway for telecom, electricity, and water.
The market Treon is approaching falls in line with the popular topic: what’s blockchain’s role in the future of smart cities?
If you’re not familiar, smart cities are places that try to be at the forefront of data and technology to improve the lives of its citizens. One hope is that blockchain can eventually streamline everyday processes that are otherwise outdated and archaic, which is why Treon’s network is an interesting project.
Treon aims to solve five problems they identify in the utility payment industry:
- A frustrating customer experience, especially for those without banks as there’s a gap between what utility companies promise versus what they deliver.
- Fragmented ways to keep up with your usage, including a variety of systems depending on the provider.
- Lack of consolidation for utilities, including billing cycle.
- No incentive for on-time payments.
- No reward for using eco-friendly utilities like solar-power or wind generation.
Treon is conducting an ICO fundraiser with a hard cap of $25 million. So far they’ve raised around $2.5 million and are looking to tackle an industry that affects nearly everyone reading this sentence. Here’s what we think:
Treon is an ambitious company and has a lot of positives in their approach. However, there are some questions about how they plan to manage certain aspects not included in their whitepaper. But first, let’s run down how exactly their system will work to understand.
How It Works
Treon starts with the wallet, which users will access via their smartphone. In their wallet, they’ll have a consolidated view of all their bills, as well as receive alerts on when payments are due. Users will have the choice of paying either with crypto or credit/debit card for TXO tokens, which will be the currency that’s sent to the utility provider.
Treon’s business model seems pretty straightforward: on the B2B end they charge a transaction and platform usage fee by different utility services, and for B2C, they aim to offer rewards programs. Furthermore, they list their total revenue streams as:
- Transaction fees (explained above)
- Distribution commission for mobile networks that sell mobile services.
- Token sale, where they want to work with utility companies on educating consumers about the Treon wallet and how to use it to pay their bills.
When you break it down, Treon offers some great benefits for both consumers and utility providers.
- Access to utility payments for the unbanked.
- Consolidated view, notifications, and management of different accounts.
- Change and optimize consumption from one dashboard.
- Loyalty points and program (although no specific mention of deliverables)
- Smart notifications to avoid any service suspension or interruption.
For Utility Companies
- Saving on transaction fees from current rates
- An incentive model of extra TXO tokens based upon their transaction volume.
- Education materials and consulting to get their customers onboard.
- Application support.
- Incentivizing green and renewable energy usage by offering zero fees for green energy providers.
On paper, Treon has covered a lot of the major talking points; however, it’s the point of detail that is what’s going to make or break them.
Items Of Note
Project Scale Development and Education
While the Treon team has experience in both the telecom and energy sectors, the scale of what they’re dealing with is quite frankly, unheard of. Although their white paper outlines the trillions in market potential, one point of concern is how adoption will work with current systems, as well as how the education process will work. Granted, Treon’s first market is Telecom, which makes sense given that out of all the utility users they’d most likely be the easiest to teach. Regardless, these are services that nearly everyone from the well-educated to the illiterate has to use, and if Treon is going to convince them to onboard, it’ll take quite a bit of effort over the long-term.
If Treon is going to be successful with utility companies, they’re going to have to onboard localities. The benefit of this is that if they land one, then they potentially just got hundreds, if not thousands of new users, however, the drawback is that they have to convince local governments, where each one has a different process on submitting a proposal like this. Furthermore, the private energy sector could potentially face the same risk, as many have partnerships with local or even state governments. And with you throw educating everyone involved in the mix on this new system, this is an uphill climb.
Incentives Don’t Affect Enough People In Time
Although Treon is looking to offer a pretty exceptional incentives package, there are some limitations, specifically with education and transaction fees. Even if a utility company was convinced to sign up, they’d still have to educate their consumers, which Treon will go through some trial and error on. Furthermore, the lowered transaction feature can be great, however, if customers can pay in debit/credit, then the utility company is still incurring that fee. Finally, the renewables incentive (while noble) requires a mass of infrastructure changes for a lot of energy providers.
Treon is after a lofty goal in putting utility payments on the blockchain but has the right team to do it. As a large part of their whitepaper is breaking down the size of each market segment, it’s understood there’s massive potential (especially with the inclusion of the unbanked), but their approach hits more of general ideas than specifics. I’ll note, however, that they appear to have the resources to land early partnerships, which if they can prove success there, then Treon has massive potential. And as the frontrunners in a sector many in the blockchain community are excited about, they might just be worth the risk.
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