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Fintech Fridays 2/09: Blockchain Incentive Programs

The ability for any entity to build their own cryptocurrency through platforms like the Ethereum blockchain has made it a viable implementation within loyalty programs for many businesses, as opposed to the traditional arbitrary points used like Qantas’ ‘flybuys’ points in their frequent-flyer program. Cryptocurrency’s perceived advantage as a loyalty incentivisation tool is that it allows a business’ customers to accumulate a reward which functions more broadly as a means of exchange and investment within the economy, with this hopefully drawing more consumers to the business. Such a system works by having customers mine and earn a business’ cryptocurrency as they purchase from them, and then be able to spend this on the business’ or its partner companies’ products. These partner companies allow their products to be purchased with the business’ cryptocurrency due to the direct exposure it gives them to the business’ customers, who may have earned the cryptocurrency buying a product that is a complement to theirs, making them potentially valuable target consumers. Such a system thus means the cryptocurrency is accepted as a wider means of exchange, in a sense manufacturing its intrinsic value. Businesses then enable their cryptocurrency to be traded on crypto exchanges, making it a potentially viable investment vehicle that hopefully incentivises consumers to take part in their loyalty program.


SweatCoin is a mobile pedometer app that allows people to earn cryptocurrency based on their steps. The app works by having users mine a unit of SweatCoin’s cryptocurrency, not surprisingly called Sweatcoin, for every 1000 steps they take. This cryptocurrency can then be spent in SweatCoin’s marketplace on their partner companies, who are largely fitness related and thus view those who earn Sweatcoin as valuable marketing targets for their products and are willing to accept the cryptocurrency as payment. Sweatcoin can also be exchanged for other cryptocurrencies, or used to purchase NFTs, in effect allowing people to earn a variety of investments. While ‘move-to-earn’ cryptocurrency apps like SweatCoin can work to incentivise consumers to purchase from a business or partake in a desired behaviour, it remains to be seen whether they can attract enough interest to significantly disrupt the traditional points-based loyalty program systems, with their added set-up costs for blockchain and cryptocurrency development being potential drawbacks for many companies.

Singapore Airlines

In 2018, Singapore Airlines converted its loyalty rewards program into cryptocurrency, launching Krispay. The platform promises to give users access to purchases right from its digital wallet, with the ability to earn points from miles travelled and also purchasing from any of its partner outlets. In 2020, the airline expanded its services, producing the Kris+ app. Many merchants in Singapore accept payments from the Kris+ app, which can be used to offset or completely cover transactions. As of late 2020, there had been 130,000 downloads (the population of Singapore is about 5.7 million).

The sceptical person may question the necessity of a blockchain based loyalty system, and how this is different from what already exists, but there are some important features worth highlighting. Firstly, so-called ‘on-chain incentives’ are much more secure because they exist on the blockchain. Secondly, the aim of blockchain technologies is to be more decentralized and transparent, and thus it is more clear how users are being rewarded. However, this scepticism may still be valid, as our research seems to suggest there has been a lot of hype around this program, without necessarily having the results to back it up.


As examples of the blockchain based incentive programs continue to grow, it will be fascinating to see whether they make a meaningful difference to the world. For example, could it be something that the government one day adopts, maybe to incentivise people not to litter in public spaces. In our view, there is a lot more development which would have to be done in this space and in cryptocurrency more broadly before it is accepted as a much wider means of exchange. Moreover, the human fascination with collecting is nothing new. For example, one study found that Pokémon Go led to a significant increase in physical activity levels for new users. While there are clearly some benefits to the blockchain that have already been mentioned, as yet, there doesn’t seem to be anything particularly special about these incentive schemes that will lead to their widespread adoption in the near future.

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