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E-commerce worldwide sales in 2014 were USD 1.33 trillion and are projected to increase to USD 4.058 trillion by 2020. E-commerce share of retail sales is expected to increase from 7.4% in 2015 to 14.6% in 2020. Furthermore, according to Statista, the number of people buying goods or services online will increase from 1.46 billion in 2015 to above 2 billion in 2020.
Despite the explosive growth, three major problems still exist:

1. Trust and reputation : Building trust is difficult, and it is centrally governed by big marketplaces. There is an inability to transfer trust from one centralized service to another, and thus a need to establish relationship with each merchant separately. Moreover, a merchant’s history is not recorded, so there is no ability to punish fraudulent buyers or merchants. Huge efforts and advertising budgets are needed to create trust if a merchant is not a part of a centralized marketplace.
2. Expensive and long payment process: There are 16(!) different steps to settle the transaction and up to 15(!) different fees to pay for payment gateways. Transaction fees range from 2% + 0.1 to 6% + 0.7. Chargeback fees of USD 15. Moreover, existing payment gateways rarely offer a simple solution for a merchant to accept mobile payments on their website or point of sale terminals.
3. An inability to reach the growing ethereum economy: Today, merchants cannot accept payments in Ether, which has reached a market cap of USD 36bn as of June 14th. Moreover, a totally new digital asset class is being created: tokens of products that are built on the Ethereum platform. The rise of a new kind of digital assets enables the creation of a token-based digital asset economy. It is expected that 10% of global GDP will be generated on blockchains by 2025. Merchants will definitely want to participate in the blockchain created economy.
   Monetha is creating a universal decentralized trust and reputation solution working flawlessly together with mobile payments processing on the Ethereum blockchain leveraging smart contract technology.
4. Universal/Transferable trust and reputation system: Every time a transaction is made the blockchain will record the time of the transaction, both receiving and sending wallet addresses, warranty conditions, delivery time,
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   and all other information that is typically needed to ensure trust. All the sensitive information will be hashed and only available to authorized users in a beautifully designed user interface. Based on that information, clients and merchants will be able to file/solve a claim, rate each other, etc. Every time a transaction is made, claim registered, solved or unsolved (according to the purchase details saved during the purchase), review written, etc., the smart contract will automatically change the trust level for each of the parties involved.
5. Mobile payments solution: With the help of the Ethereum blockchain, we are able to make payments with only 1 step and 1 fee, which results in accepting payments generally up to 5X cheaper and up to x10000 faster for merchants. After simple integration with Monetha, merchants will be able to: use our decentralized trust and reputation system, accept Ethereum based tokens, accept mobile payments, and easily convert cryptocurrency to their local fiat currency.
6. Enabling merchants to reach $10 trillion digital asset economy: By developing Monetha, we will not only allow merchants to participate in a trustful decentralized economy, but also reach the growing digital asset economy through our payment solution. The World Bank estimates that 10% of global GDP will be generated on blockchains by 2025. The GDP estimated for 2025 is $100T, thus the value generated through blockchain is expected to be $10T (10%).
   Mobile payments: According to Boston Consulting Group, the payment industry is about to experience a huge shift towards mobile payments: 1) In 2015 mobile payment volume was USD 8.6 billion in the US. It is expected to increase almost 32x by 2021 to reach $274bn in the US alone, 2) mobile share of total ecommerce is expected to increase to 48.5% of total e-commerce by 2020. It was 23.6% in 2015.
   Business model: Monetha will only have one fee – a 1.5% transaction fee for merchants.
   Token and token ecosystem: A 1⁄3 of Monetha’s revenue will be put in the “Voucher Smart Contract” in a form of MTH tokens to our token holders with an ability to claim for a voucher proportionately to the amount of MTH tokens they hold. Token holders will receive a voucher in MTH (Monetha’s currency) to use it as a discount when buying from Monetha’s merchants. This voucher would be proportional to the amount of the MTH tokens held.
   Loyalty program: In order to encourage a network effect and create an ecosystem for the Monetha token, we are going to introduce a loyalty program for merchants.
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   Every purchase made via the Monetha payment system will reward the client of the merchant with 0.2% (the exact percentage might change over time) of the value of the transaction in Monetha tokens from the Monetha loyalty pool.
7. Three significant problems that merchants face: trust and reputation, payments, and an inability to reach the growing Ethereum economy
   E-commerce has grown at an unprecedented rate and is projected to grow at an even higher rate over the coming years. According to “Statista”, retail e-commerce sales worldwide in 2014 were USD 1.33 trillion and are projected to increase to USD 4.058 trillion by 2020.
   The growth is perfectly illustrated by the number of shops created on the Shopify platform. They had 84,000 shops in 2013, 144,000 in 2014, 243,000 in 2015 and ended 2016 with almost 378,000 merchants on the platform - a growth of 450% over 3 years.
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   E-commerce is also gaining greater weight in total retail sales globally. It is expected to increase from 7.4% in 2015 to 14.6% in 2020. Furthermore, according to Statista, the number of people buying goods or services online will increase from 1.46 billion in 2015 to above 2 billion in 2020.
   Despite the super high growth of e-commerce, merchants face three major problems: 1) Trust and reputation, 2) Expensive and long payment process, and 3) An inability to reach the growing Ethereum ecosystem, with a market cap of ~36 billion and its corresponding Ethereum token economy.
   1.1 Trust and reputation problem in global e-commerce
   Building trust is difficult. It takes time and costs a lot of money. It’s even more difficult
   for new or small merchants.
   Trust and reputation are extremely important for participants of today's global commerce. People are more likely to buy from trusted merchants; therefore, merchants are striving to maximise their trust rating/reputation and build a loyal customer base.
   According to Econsultancy, 61% of customers read online reviews before making a purchase decision. Moreover, according to Reevo stats, 63% of customers are more likely to make a purchase from a site which has user reviews and a proven trust rating.
   Consumer reviews are significantly more trusted (nearly 12 times more) than descriptions that come from manufacturers, according to a survey of US internet users by the online video review site EXPO. Furthermore, Shopify, in one of their merchant blogs, emphasized that “showing that others trust you” is vital to a merchant’s success.
   There are, however, a few major problems regarding trust that merchants face in today's global e-commerce.
8. The trust and reputation system to facilitate commerce is only possible in closed marketplaces, which are controlled by a central authority. In order to build trust, you have to join one or a few of the closed marketplaces, such as: Amazon, Ebay, Alibaba, etc. By joining them, merchant must accept all their rules; for example, 20% commission from sales.
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9. Merchants have no ability to transfer their trust rate from one centralized service to another. For example, once you become trusted on Amazon, you still must build your trust on Ebay or another marketplace.
10. Merchants have to invest considerable effort and finance into their brand and advertising if they do not want to join the centralized marketplace that facilitates trust and reputation.
11. Buyers need to establish a relationship with each merchant separately. Moreover, a buyer’s history is not available for merchants to make decisions. Being trusted with one merchant doesn't mean you are trusted with another.
12. There is no ability to punish fraudulent buyers or merchants and reflect that in their history. Most fraud happens due to stolen cards or stolen credit card information. In 2015, card fraud reached $21.84 billion – a figure that is expected to rise to $31.67 billion by 2020. According to Advanced Payment Report 2016 conducted with the help of Wirecard.de, 92% of merchants say fraud will remain a prime concern for online payments. Large e-commerce and m-commerce merchants lose 1.4% and 1.7% of revenues respectively to fraud according to the 2015 True Cost of Fraud Study.
    There are millions of e-commerce merchants outside closed marketplaces that need a universal trust and reputation system in order to be trusted by their clients.
    In order to build global trust in e-commerce, we need a universal trust and reputation system . Payments and commerce using Monetha will be done directly between two unknown parties using a much-needed decentralized, smart contract based, trust and reputation system .
    1.2 Expensive and long payment process
    Despite having a wide variety of different payment gateways and processing
    companies, the following major problems still exist for merchants:
    ● Costly and complex transaction settlements with up to 16(!) steps to accept and settle transactions.
    ● Up to 15(!) different type of fees including a transaction fee of between 2% to 6%, and a chargeback fee of USD 20.
    ● Extremely high cross-border transaction fees.
    ● Long transaction times ranging from 2 days to several weeks to receive their
    money. E-commerce payment processors often hold merchants’ money for a week due to higher probability of chargebacks during first week after
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    purchase.
    ● Mobile payments. Mobile payment solutions are fragmented and not available
    universally or simply not easy to use despite a strong consumer appetite to leverage them. Payment processors rarely offer a simple solution for a merchant to accept mobile payments .
    1.2.1 Current payment process
    The picture below describes the payment confirmation or rejection in 8 steps at the time of payment regardless of it being in a physical store, e-commerce or m-commerce. The process is complex and includes 8 additional steps to settle the transaction. In total, you have 16 steps for money to be transferred from the client's bank account to the merchant's bank account.
    1.2.2 Merchant fees Merchants have to pay up to 15(!) different types of fees in order to accept
    payments from their customers.
    ● Transactional fees stand somewhere between 2% and 6% per transaction plus a fixed fee which is between USD 0.1 and USD 0.7. For example: every time someone makes a transaction for USD 10, the merchant on average pays => 10*((0.02+0.06)/2) + ((0.1+0.7)/2)) = USD 0.8 for banks, credit card associations, payment gateways and processors.
    ● Retrieval Request Fee and Chargeback Fee are paid when someone claims for a chargeback. The best-known payment gateways such as PayPal and Stripe charge merchants a USD 15 chargeback fee. In addition to the chargeback fee, there is work to be done by the retailer to prove the
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    transaction was done respecting the rules. This costs time and money. When the info is missing, the charge is reversed even if it was legit.
    ● Flat fees include: Terminal fees to buy the needed terminal for retail merchants, PCI fees paid to Payment Card industry for compliance OR noncompliance, and others, such as: Annual fees , Monthly fees , Monthly minimum fees , IRS reporting fees , network fees , etc.
    ● Incidental fees that consist of: Address Verification Service (AVS) , Voice Authorization Fee (VAF), Batch Fee, and NFS fee.
    ● Cross-border fees. PayPal, for example, charges the merchant a transaction fee of 4.4% + fixed fee (depends on the currency), instead of 2.9% + fixed fee (depends on the currency) if the funds the merchant is receiving comes from outside of the U.S.
    Finally, some payment gateways and/or processing companies like to keep their fee structure hidden or totally incomprehensible to the average merchant.
    1.2.3 Long fund transfer time
    As there are a lot of different parties involved in moving the money from one bank account to another (or from one country to another), it often takes up 3 days to settle the transaction . For international payments, it can take up to a week or even more . Moreover, payment gateways more often than not hold your money for a week.
    That often causes cash flow problems for small merchants. 1.2.4 Mobile payments
    According to StatCounter, October 2016 was the first ever month in the history when more users around the world accessed the internet from mobile devices than from desktop computers. Of all users, 51.3% used mobile devices while 48.7% used computers. Moreover, according to Statista, approximately 80% of internet usage will be mobile by 2018 . At the same time, mobile payments are projected to increase from USD 8.6bn in 2015 to USD 274bn in 2021.
    The problem is that most e-commerce and retail payment gateways and/or terminals were developed to accept and process payments using physical credit cards, and at their core, cards are not mobile-friendly. Payment gateways rarely offer a simple
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    solution for a merchant to accept mobile payments in their website or point of sale terminals.
    1.3 An inability to participate in token-enabled digital asset economy potentially worth $10T in 2025.
    The market cap of all the Ethereum tokens is growing extraordinarily fast. Ether reached a market cap of USD 36bn as of June 14th. But most importantly, a totally new market of digital assets is being created: tokens of projects that are built on Ethereum platform. The rise of new kind of digital assets enables the creation of a token-based digital asset economy .
    A correspondent of Bloomberg talks about it here , starting from 2:00.
    The World Bank estimates that 10% of global GDP will be generated on blockchains by 2025. The GDP estimated for 2025 is $100T, thus the value generated through blockchain is expected to be $10T (10%).
    Today, merchants don’t have an opportunity to access that money. They will have a considerable incentive to participate in the token economy within the next few years.
13. Monetha’s solution: a decentralized trust and reputation system working flawlessly together through a blockchain based payment gateway
    We are creating a decentralized payment and trust solution on the Ethereum blockchain leveraging smart contract technology. The payment solution works flawlessly together with our decentralized trust and reputation system. Merchants will be able to accept Ethereum based cryptocurrencies and exchange them with traditional (fiat) currencies. Merchants and customers will participate in global decentralized commerce with total trust.
    Monetha is on a mission to:
    ● Develop a global decentralized trust and reputation system for tomorrow's global e-commerce.
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    ● Make the payment process simple and efficient: only one step .
    ● Make accepting payments for merchants generally up to 5x cheaper and up
    to 10,000 times faster.
    ● Provide an opportunity for merchants to accept mobile payments.
    ● Bring the Ethereum-based token economy to the mainstream.
    ● Expand Ethereum real-world application infrastructure.
    In simple words: our mission is to develop and deploy the best transaction system that would be based on enforceable contracts without third party between consumer and merchants and a strong decentralised reputation management system. Transaction and fund transfer will be done in one step together with the enforceable sale contract. Transaction fees would be simplified from many to a simple transaction fee wherever the consumer and merchants are located on the planet.
    2.1 A Universal Decentralized Trust and Reputation System on the Ethereum blockchain. Ensuring trust in global commerce.
    Building trust is difficult because:
    ● Merchants need to become part of a centrally governed marketplace, like Amazon, Ebay, Alibaba, Etsy, etc, where they must pay a sales commission.
    ● Merchants cannot transfer their trust from one centralized service to another.
    ● Merchants need to invest huge efforts and budgets into brand and advertising if not being part of centralized marketplace.
    ● Complicated conflict management using existing system.
    ● Buyers need to establish a relationship with each merchant separately and
    their history is not transparent.
    ● There is no ability to punish fraudulent buyers or merchants and reflect that in
    their history.
    Monetha’s trust and reputation system will be universal, transparent, transferable, self-executing, not controlled by a central authority, and working flawlessly together with a payment solution.
    2.1.1 How it works
    Every time a transaction is made, no matter if it’s retail or e-commerce, the blockchain will save the time of the transaction, both the receiving and sending addresses, warranty conditions, delivery time, and all other information that is typically needed to ensure the trust. All the sensitive information will be hashed and only available to authorized users in a beautifully designed user interface. Based on
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    that information, clients and merchants will be able to file/solve a claim, rate each other, etc.
    Default trust rates will be created for both merchant and client using the Monetha ecosystem for the first time. A Trust rating will be assigned to a specific wallet address. Every time a transaction is made, claim registered, solved or unsolved (according to the purchase details saved during the purchase), review written, etc., the smart contract will automatically change the trust level for each of the parties involved.
    The merchant trust rating
    Once the merchant starts accepting mobile Ethereum based currency payments using Monetha, a default trust rating will be created. Smart contract will automatically change the trust rating according to the behavior of the merchant. For example:
    ● Does the merchant react to claims from clients?
    ● Does the merchant react quickly to claims from clients?
    ● Do clients rate the merchant for delivering products as promised: on time, as
    advertised and in good quality?
    ● Does the merchant have good reviews from clients?
    Different weights will be assigned to different actions.
    The trust rating will be visible to everyone in the most common and typical places, such as the footer of the merchant's website or mobile app. The only way the merchant can increase the trust rating is by providing products or services as advertised and in good condition.
    Trust client’s trust rating
    The main reason to create a trust rating for the client is to decrease the likelihood of
    fraudulent buyers and offer loyalty features for trustful buyers.
    Once a client buys something from a merchant using Monetha for the first time, the default trust rating for that client will be automatically created and linked to the wallet address of that client.
    The client trust rating will be updated automatically by the smart contract based on his or her behavior. Different weights will be assigned to different actions. For example:
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    ● What is the client’s claim history?
    ● How many claims has the user made? Are those claims being resolved?
    ● Have all the previous claims been solved with merchants?
    ● Purchase history: behavior, frequency, etc.
    The trust rate of the client will be available to see on the blockchain and visible in a user-friendly interface to merchants once the purchase is made.
    The client’s trust rating will be visible on the blockchain or in Monetha’s mobile app.
    In totally decentralized e-commerce, it is important that merchants have information about the client . The most important thing for a merchant is to avoid someone who does hazardous things on purpose. If that happens, the merchant will be able to decrease the client’s trust rating significantly. Based on that information, other merchants will be able to decide whether they want to sell products to a client with a low trust rating.
    Claims, reviews and conflict management.
    Every purchase will be saved on the blockchain together with the time of the transaction, both receiving and sending addresses, warranty conditions, estimated delivery date, the product that was bought and all other information that is typically needed to ensure trust.
    The following information will be available to both parties:
    ● The merchant will have all the information about every transaction with the above-mentioned details in his profile in the Monetha system.
    ● The client will be able to see all his purchases together with the above-mentioned details only in his profile within the Monetha mobile app.
    Based on that information, parties will have an opportunity to file/resolve claims, review, and rate each other in a transparent way. Smart contract will automatically decrease or increase the trust rating. That kind of management of conflict resolution through smart contracts will help each party to deal with the situation faster, easier and cheaper (no chargeback fees for the merchant).
    Examples :
14. Claim. Once the client makes a purchase, all the needed information is saved to the blockchain. In order to see that information, the client must download the Monetha app. Once he logs in, he sees all the purchases he made with a
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    particular wallet address anywhere using Monetha as a payment gateway . The client selects the particular purchase he is not happy about, and initiates a claim by providing the details of the claim, e.g., the product is broken. The merchant’s trust rating is immediately decreased, so the merchant is incentivized to solve the problem as quickly as possible. The merchant receives the notification about the claim, looks at the details and contacts the client off-chain. Client and merchant agree on the solution and one of the parties initiates a resolution by pressing the "Claim resolved" button in the mobile app or the merchant system. Details of how the situation was resolved (product changed, money returned, etc.) must be provided as well. The details are saved to the blockchain. The other party gets the notification, reads the details and agrees by pressing “Claim resolved”. Once the claim is resolved, trust rating is increased for both parties instantly.
15. Reviews . Clients and merchants will be able to write reviews about each other. Written reviews will have more weight on each other’s trust rating than just “silent” transactions without a review. For example, a client's review about a good product and customer service will increase the merchant's trust rating more than just a simple “silent” transaction without writing a review. Reviews about the merchant will be visible in the mobile app for a client. Merchants will see the reviews clients have written about them in their system. All reviews, good and bad, will be automatically reflected in the trust rating of the client and the merchant .
16. Sales contracts . A merchant can propose a 15 day return policy - no questions asked. This merchant will be in a better position to sell than the one who does not offer a return policy. These rules will be published by the merchant. Smart contract will ensure merchants and consumers are respecting their commitments to each other and the rating system will reflect that.
    2.1.2 How the likelihood of fraud is reduced with a global decentralized reputation and trust system
    The trust rate will be available and visible to everyone in the ecosystem so that parties are incentivized to increase their trust rating, which will enable better decision-making and a safer e-commerce environment. Moreover, we will offer incentives such as a reduced transaction fee, faster transaction times, etc., for those who hold higher ratings and proven history. This level of transparency could decrease fraud significantly or at least make it more difficult.