Winding Tree – Decentralizing Travel Distribution

Winding Tree Overview

Winding Tree provides a decentralized travel distribution platform specifically built to provide a free and competitive market for buyers and sellers. Suppliers such as airlines and hotels are able to connect directly with travel operators without the high costs and inefficiencies currently associated with existing centralized platforms.

 

The Problem

Global travel and tourism are one of the world’s largest industries, with a direct economic impact amounting to $2.3 trillion in 2016. Despite the size of the travel industry, it is currently dominated by a small number of established companies who have completely monopolized the market creating high barriers to entry. This has stifled innovation within the industry even though the main Online Travel Agencies (OTAs) and Global Distribution Systems (GDSs) have recorded year on year growth and profits. Ultimately it is the consumer who loses out through increased costs as a result of double marginalization due to markups and fees added by distributors and suppliers at every level of the travel supply chain.

 

Winding Tree Value Proposition

Winding Tree aims to make travel cheaper for users, while also making it profitable for suppliers by providing a free decentralized open source platform. This ensures there is no centralized single point of failure or single entity to charge extortionate transaction fees as inventory distributors are directly connected with customers within the platform.

Winding Tree enables travel distribution in all forms and implicitly encourages new businesses to compete within their ecosystem at a cheaper, faster, and easier route than conventional methods. This opportunity brings competitiveness back into the market to compete with established companies and help facilitate competitive pricing and innovation. Suppliers put information surrounding services and price into the marketplace where it is easily discoverable and accessible to sellers who will, in turn, have the ability to buy that inventory and pay for it instantly. All these interactions are designed to be performed without any human intervention to the benefit of the travel industry and end user.

The Winding Tree team has secured some high-profile partnerships with Lufthansa and Air New Zealand to name a few in advance of their Token Generation Event which has added weight to their value proposition and Business-to-Business (B2B) target. The platform is initially positioned to target B2B transactions to help incentivize suppliers and distributors to consistently contribute and drive mainstream adoption. The beauty of the Blockchain ensures that anyone will also be able to book directly through the Blockchain to take advantage of available prices. This would initially open up additional benefits for tech-savvy end users familiar with Blockchain initially, but you would expect would benefit all users once the system matures going forwards.

 

Líf Token

The Líf token is at the core of the Winding Tree ecosystem and facilitates transactions on the platform. The token has been expanded to handle more data than a typical ERC20 token whilst still remaining ERC20 compliant. Líf has two main purposes within the platform:

Payments

For suppliers or distributors to book anything on the Winding Tree platform they will have to use Líf. For anyone to access the platform and list inventory they will have to use Líf.

Transactions

Líf facilitates transactions on the Winding Tree platform and makes transactions between users without the need for intermediaries.

 

Winding Tree ICO Team

The founder of Winding Tree is Maxim Mizmaylov and has experience as a leader in the travel tech industry. Maxim and Winding Tree CTO Jakub Vysoky are also the co-founders of a travel services company called Roomstorm that offer last minute hotels in the event of overbooking and cancellations. The fact they have taken a travel company from startup to successful business and are now turning their hand at another venture within the same space together strengthens their working relationship and ability to see this through to completion. Winding Tree COO and Co-founder Pedro Renaud Anderson is in charge of securing partnerships and has already secured some high profile names and partnerships as mentioned earlier in this article. The advising team is diverse and varied as you would expect for such a large platform and include industry and founders alike such as Willian Niejadlik, Co-founder and former CTO of Vayama, one of the largest travel inventory distributors in the market.

Token Generation Event (TGE)

Token Name: Líf

Blockchain Platform: Ethereum (ERC-20 Standard)

Issue Amount: Decided by market

TGE Price: 1000 LIF/ETH (Week one) 900 LIF/ETH (Week two)

TGE Start Date: 1 Feb 2018

TGE Duration: 2 weeks, until 15 Feb 2018

Funds received by Winding Tree Team: USD $10m

 

The Winding Tree token sale is different to the Initial Coin Offerings that are common within the crypto space. The team are adopting a Market Validation Mechanism  which increases uncertainty around the number of tokens generated as this is determined by the market. The team will receive a maximum of $10 million regardless of how much is raised in the TGE. The remainder goes into a smart contract which buys back tokens that provides investor protection. So If token holders return their Líf for ETH, the contract will send back a portion of the cost and if this returns to $0 the team will receive nothing. The advantages of this TGE structure gives everyone time to participate because there is no cap but also means the final cap and token supply in the short term are unknown, which creates a relatively high level of uncertainty for initial investors.

Winding Tree Strengths

The secured partnerships and progress of work are the main strengths for Winding Tree. Having already secured strategic partners the team are also working with these partners to test the platform and pilot parts of their work in real-world scenarios to determine its validity. This will go some way to providing seamless integration for other large companies who may be resistant to change. Benefits to the stakeholders can be found below:

 

Suppliers:

  • Removes fees paid to intermediaries in current centralized system
  • Display entire inventory direct on the Winding Tree platform
  • Reach wider range of users
  • Use Líf tokens to pay for services, no FX rates

 

Sellers of Travel:

  • Ability to access inventory across all suppliers
  • Single Winding Tree platform to view everything
  • No markup fees
  • Use Líf tokens to pay for services, no FX rates

 

Travelers:

  • Competitive prices across market
  • Use Líf tokens to pay for services, no FX rates
  • Ability to access Winding Tree Platform to view everything

 

Winding Tree Weaknesses

Scalability of the Ethereum network will become a problem if huge amounts of data are witnessed on the platform, the Winding Tree team will need to ensure this is built into future iterations to ensure it congestion does not impact the stakeholders within the system. Weaknesses to the stakeholders can be found below:

 

Suppliers:

  • Necessary to integrate all proprietary data into the Winding Tree platform
  • There will be additional costs associated with this setup

 

Sellers of Travel:

  • Integration costs onto platform may be high

 

Travelers:

  • Platform not initially set for travelers, Winding Tree team focusing on B2B target

 

CryptoLingo Verdict

The Winding Tree project is a fascinating attempt to tackle an existing current centralized use case in a decentralized way. The project aims to bring benefits to all stakeholders within global travel and tourism’s trillion-dollar industry. If executed correctly this project can revolutionize the way stakeholders engage with one for the better and CryptoLingo feels Winding Tree is definitely one to watch as they challenge and force the industry to innovate and rethink in a decentralized way for the better.

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