Vlad Costea

Vlad Costea

Vlad says that he's a political science graduate with a fascination for Bitcoin and free markets. His profs say he's a crazy anarchist who probably doesn't deserve his degrees. His parents say he's wasting his potential on a pipe dream.

December 20, 2019
Payments

Video: StormX CEO Simon Yu on Micro Rewards and Sats Back in Bitcoin

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StormX allows people from all around the world to earn satoshis for playing video games, testing applications, completing surveys and fulfilling other types of microtasks. Launched in January 2014 as Storm Play, the platform has managed to pay out more than 249 BTC (about $1,784,000 at the time of writing) to users in less than six years. And, thanks to a recent expansion called StormShop, U.S. residents can now get bitcoin as sats-back for their purchases (as well as ether or other cryptocurrency).

In a recent interview, StormX CEO and co-founder Simon Yu (who was also behind blockchain-based payments company CakeCodes) told Bitcoin Magazine that, with the new launch, the project hopes to pay out thousands of bitcoin to users by the end of 2020.

How Sats Back With StormShop Works

StormShop is not the only sats-back option available. There are other options, like Fold and Lolli, but each of these offer slightly different options for users.

In order for shoppers to take advantage of the sats-back shopping with StormShop, they have to download the StormShop browser extension (available on Google Chrome, Firefox, Brave and Microsoft Edge) and sign up with some basic personal information and a Bitcoin address. Once installed, the extension will automatically notify users when they are visiting the website of a retail partner that is eligible to provide BTC rewards. 

For safety reasons, the sats only get sent once it becomes clear that product returns are unlikely to happen. 

“After you are done shopping, you will receive a notification which confirms your purchase,” said Yu. “Once it’s sure that you won’t be making any returns, the satoshis will be delivered in your account.”

Withdrawals can be made directly to a Bitcoin address or a Coinbase account. The latter option is designed for newbies who aren’t ready to fully embrace their financial sovereignty and would rather enjoy an experience that resembles one they might have with more mainstream digital payment processors. 

“You can withdraw the funds to your own wallet by pasting an address, but we have also added a Coinbase integration for convenience. New users will experience it just like PayPal, as they only have to type in their email address,” explained Yu.

StormShop Privacy and Expansion

Yu clarified that privacy is a priority for his project and even cited Facebook’s Cambridge Analytica scandal as a significant paradigm shift in handling user data. 

“We will only collect the minimum information,” he said before pointing to the EU’s General Data Protection Regulation (GDPR) as a data management model of choice. 

Yu also pointed to Bitcoin as a privacy-friendly medium for making payments, as unbanked people are able to use both StormX as a platform to earn satoshis for their tasks and StormShop as a cash-back solution. 

“Privacy is also one of the reasons why we support Bitcoin: our users can make transactions without giving out as much information,” said Yu.

Currently, StormShop offers sats back from retailers such as eBay, Newegg, Groupon and Microsoft. More than 300 brands have been made available in less than a month, and the plan is to continuously expand, with 2020 bringing the service to European and Asian shoppers. Consequently, more local brands will be added to suit the specific preferences of customers across the Atlantic and the Pacific.

StormX is already available to users worldwide, and only a small fraction of its daily microtask enthusiasts are from the United States. 

“Interestingly, most of our StormPlay users who play games and complete surveys are international and less than 10 percent of the total user base consists of U.S. citizens,” clarified Yu. This metric might point to forthcoming success in the project’s international expansion, as existing StormX users are more likely to also sign up and receive BTC rewards each time they shop.

StormShop’s Bitcoin Business Model

StormX and StormShop are designed to be tools that increase traffic, sales and consumption for its retail partners. Users are paid by the companies that become partners of the sats-back program. And in order to sustain its operations and grow at scale, StormX charges a small fee for intermediating the process. 

“The companies pay us for getting them more traffic and increasing their sales. When users get paid, we just take a small transaction fee. So the more cash back we pay, the more revenue we have for StormX,” explained Yu.

In order to tackle BTC volatility and make sure that the satoshis are paid in amounts that correspond to the USD valuation on withdrawal day, StormX uses a proprietary token called bolts. Therefore, the bitcoin purchase for users doesn’t happen until the moment when the user manually solicits a withdrawal. If users have a trading strategy, they can leverage the system in their favor by maximizing the BTC amounts based on market movements.

StormShop is currently focused on building new features and adding new brands — and if you ask Yu about his hopes and expectations for the project, he will emphasize that he wants to enable sats-back rewards totaling thousands of bitcoin.