We previously wrote about the idea of using an energy backed crypto token. It is one of those ideas that take the idea of crypto beyond just the ‘virtual’ world and into the ‘real’ world. In addition, the idea of an energy backed crypto is appealing. It provides the advantages of a blockchain – an open, incorruptible ledger, combined with a token that’s backed by something that is useful in the real world – and what’s more useful to our civilization than energy?
Today, we discuss another such project – RED (Restart Energy Democracy). The RED team is also putting out an energy backed token, called the MWAT token. The company is more interesting though – they have an existing client base of over 3,000 businesses and 25,000 residences, and has an existing business in the EU. This greatly helps when it comes to trying to get others to adopt your ideas and product, since there’s a ready customer base already.
Also, the team is knowledgeable about the industry and therefore presumably have a higher probability of success.
We’ve heard some people trying to compare WePower and RED. We don’t take sides on projects we discuss. However, there’s this misconception that if there is one project in the space, then there’s no need for another one. This is completely false. The energy industry is a multi-trillion dollar industry. Innovation in this industry will drive the next trillions of dollars of value created. There is space for multiple projects.
In fact, the more projects in a niche, the better, since they are bound to take different approaches and methodologies, and after the dust settles, the market determines which approaches worked and which didn’t. We like to see such real world experiments run, especially in the crypto world. This reduces the learning curve for the next projects.
We are, of course, seeing an increasing trend towards crypto projects that combine multiple technology trends. In a similar vein, the RED project combines green energy with crypto.
So about the RED Platform itself, it can be used for a number of purposes. Firstly, the simple buying and selling of electricity in a peer to peer marketplace is enabled. This means if you have solar panels installed on your roof, you can sell this energy to your neighbor – no need to go the grid at all. A small community-driven power project can become feasible all of a sudden.
Also, energy-backed tokens are interesting in that they help finance a green energy project better than regular money. How? By promising to pay back not in USD or EUR but in KWh instead. This is more predictable and isn’t dependent on the market vagaries. This provides a higher incentive for entrepreneurs to start new projects and get them funded.
RED has the MWAT token backed by energy, with a maximum of up to 1 MWh, although it starts at 0.1 KWh.
Interested in participating in their token sale? Make sure you read the whitepaper.
Photo Credit: marian rodriguez