InstaSupply: Guaranteeing B2B with Blockchain …

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is a platform that enables B2B payments to manage the exchange of all their business interactions. These interactions include placing purchase orders directly with those suppliers, documenting the receipt of goods delivered from the same suppliers and receiving all of the corresponding invoices.

InstaSupply already has over 2,000 businesses that use this platform every month. In the system’s current state, they summit approved invoices to buyers’ banks, accounting software and ERP systems.

InstaSupply was founded in 2014 by Lee Pruitt and Tim Huegdon with the aim of simplifying all buyer and supplier business interactions online; the company was born out of their prior experiences. InstaSupply has spent time building and refining a robust workflow that captures, digitizes and automates all of the back-and-forth interactions that proceed payment.

Funded through rounds of investor financing, the company has built a team of deeply experienced professionals who develop the platform, onboard and sustain thousands of businesses and have processed over $60 million in transactional value.

SMB and B2B

Small and mid-sized businesses (SMBs) are profoundly affected by the impact of lengthy credit terms upon sale, with traditional financial products failing to cater to them. This leaves SMBs with few options when looking to alleviate cash-flow problems. Having identified this problem, InstaSupply has introduced PayBlok, a token aimed at solving SMB cash-flow problems.

The business-to-business (B2B) payments landscape totaled $18.5 trillion for 2016 in the United States alone and relied heavily on credit (42-48% in most countries, according to Atradius Collection). Typically, SMBs lack the resources to run best-practice administrative tasks focused on payment and collection. They are in a weaker position to negotiate payment terms with their suppliers. These two factors result in SMBs depending on credit to survive, a dependence that is exacerbated by the fact that half of all sales on credit fail to be paid on their due date, creating demand for even more credit. Despite this, banks have been unable to offer any accessible solution for SMBs.

With this in mind, InstaSupply is looking to further increase their support for SMBs by offering an early payment function on top of their existing platform—which connects buyers and suppliers matching purchase orders, deliveries and invoices. This will enable the provision of de-risked financial products to SMBs.

The volume of transactions that goes through the platform exceeds $60 million per year. The new early payment function will enable hosting of over $200 million of operations in the first year of deployment.

The PayBlok Wallet

Every vendor on the InstaSupply platform will receive a virtual wallet to hold their PayBlok tokens.

The PayBlok wallet will be built as a centralized virtual wallet within the InstaSupply application, specific to each business vendor (buyer or supplier). Users will be able to transfer PayBlok into their wallets from external sources using standard blockchain, and will also be able to transfer PayBlok back out again.

Since PayBlok will be implemented as an ERC-20 token, the InstaSupply PayBlok Wallet will also be able to store ETH in order to allow gas payments for transfers on the Ethereum blockchain.

Centralized Vs. Decentralized

InstaSupply has chosen to implement the PayBlok wallet centralized within the application in order to provide the most straightforward interface to users. An excellent example of a centralized architecture within the current cryptocurrency ecosystem would be Coinbase, where a user logs into a cloud-based account and can transfer funds into and
out of an online wallet.

Currently, most of our users are not deeply technical, nor should they be required to be. Enforcing a decentralized architecture for wallets would require an understanding of token storage in some form of separate application, browser extension, or hardware wallet. Examples of decentralized wallets in the current ecosystem are MetaMask, MyEtherWallet, Exodus, Jaxx, and Mist. In these examples, a user can only manage and transfer funds from the specific physical hardware that stores the cryptographic keys for these wallets. We have agreed that this kind of expectation of technical know-how on our users, at time of writing, would be unfair and a severe disadvantage to the platform as a whole. However, it should be noted that the decision to implement centralized wallets over decentralized wallets will be continuously re-evaluated and, should the implementation of a decentralized architecture become more viable, there is nothing that would prevent us prioritizing the upgrade.

PayBlok Tokens

PayBlok is a crypto-asset (token) that gives its owners/holders exclusive benefits on the InstaSupply platform. It will be developed under the ERC20 Token Standard. As an asset, the initial sale of tokens will be subject to sales taxes according to the market where it is sold. Following this, a token belongs to its owner and can be traded without restriction or the need for consent or participation from InstaSupply.

The creation of the PayBlok token enables InstaSupply to offer a range of products:
• Integrated Payment Solution
• Supply Chain Financing
• Asset-Based Lending

Any business within the InstaSupply platform may purchase PayBlok at any point, by way of internal integrations with third-party cryptocurrency exchanges.

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