Comment on page
What is the purpose of Vow?
The purpose of VOW is to provide nodes on the network (e.g. businesses) the ability to issue fixed value tokenised currencies called Voucher Currencies. Merchants purchase a number of VOW tokens, representing 20% of their annual rewards budget. They then send this sum to a smart contract address on the blockchain - a process which currently results in creating Voucher Currencies worth 5x the deposit value, ready for distribution.
Consequently the business can issue their intended rewards to customers as they normally would, however this time denominated in Voucher Currencies as opposed to fiat cash.
Merchants can unlock their VOW and receive its full value back any time they return the same value of Voucher Currencies they have distributed to the smart contract. This strategy means businesses will have accepted back from their customers the same value of Voucher Currencies originally distributed, proving that they honoured their Vow.
In this way, VOW serves as a collateral in the process of replacing cash in any spend cycle. As such, VOW can be applied to any spend cycle as long as the distributor backs their distribution by vowing to accept them back against their goods and services and in addition locks up an additional deposit (20%) of Vow in the smart contract.