A new cryptocurrency available without the internet represents one of the first examples of how to implement blockchain technology in the absence of a decent digital infrastructure.
Three billion people fit into 160 characters. Roughly, this is the number of people in the world with mobile communications but without internet access, according to data from the telecommunications association, GSMA. Until now, one of the most vibrant revolutions of our time has been unavailable to these people: blockchain and the world of ‘tokenomics’ or the crypto economy. SMS, which had been all but displaced by instant messaging systems like Telegram, WhatsApp, or Snapchat, has made entering the world of blockchain technology without the internet a possibility.
Currently the projects are few and far between, but they are out there. They are being talked about at major industry events, such as The World Blockchain Forum, held this year in Dubai. This was the event where the company ONEm chose to launch its initial coin offering, or ICO. The initial offering of its cryptocurrency, called mCoin, attracted more than 30,000 buyers in 150 countries, according to the company. The number of available mCoins is already defined and is limited to just under 31.5 billion.
The fundamental idea behind this cryptocurrency is summarized in its whitepaper: “Other cryptocurrencies rely on the internet, excluding those who are not connected. mCoin is inclusive because it works both on and off the internet. Billions of people will be able to access a Blockchain cryptocurrency for the first time.” The key technologies that ONEm has been developing since 2012 coincide in several ways with blockchain, but diverge radically in other ways.
On the one hand, one of its most characteristic features is pseudo-mining. Instead of allowing users to earn mCoins by becoming miners, they earn them by using services of the app itself, which has a “social and economic impact.” ONEm gives the following examples: “Language translation to remove communication barriers; internet encyclopedia wiki service to search for any topic; group messaging to foster collaborations.” To verify the block, there will always be a ONEm miner who can attest to who has used these applications.
Additionally, mCoin uses a blockchain structure in which the nodes can be online and offline. In case they are offline, all transaction data and executions are conducted over SMS.
ONEm is the most ambitious project of its kind, applying SMS communication functionality to blockchain, but it's not alone. With a budget of only 10 euros and 90 minutes, Pavol Rusnak, CTO of the Czech cybersecurity company, Satoshi Labs, developed a viable prototype that combines bitcoin and SMS. The whole mining and coding system follows the conventional process, but the transaction data is sent by SMS.
One of limitations that Rusnak found in developing the demo is the amount of text permitted in an SMS — a maximum of 160 alphanumeric characters — which requires segmenting the transaction across various successive messages. But this programmer and business executive doesn't hesitate to point out: “If this can be accomplished by one person in hardly any time at all, imagine what is possible with the right resources.” The code for the prototype, provisionally called SMSPushTX, is available in the world's most popular programming repository, Github.
Expectations for the marriage of SMS and blockchain seem to grow and grow in the headlines. Samurai Wallet has announced the launch of Pony Direct , a payment system that enables the sending of bitcoins over SMS, bypassing censorship or other Internet restrictions in countries like China or North Korea. The Russian startup SMSChain presented its project, called SMSChain, that lets anyone in the world, in exchange for an economic benefit, contribute their SMS for the purposes of creating a decentralized blockchain. The company, SMS Software Inc. has already launched an open beta version for a messaging-based bitcoin system in the following countries: The United States, The United Kingdom, Canada, Australia, South Africa, Switzerland, Sweden, and the Netherlands. It remains to be seen if the most critical aspect of the cryptos — regulation — doesn't dampen the budding euphoria for “offline blockchain” over SMS.