Blockchain Payment: How They Work

Posted on 1/30/2018 by Jim Pickerell | Printable Version | Comments (0)

After publishing several stories on blockchain technology as it relates to image licensing, it has been unclear to me how customers with dollars in their pocket would conduct a transaction to license use of a photo and how the image creator would actually gets dollars they can use to buy groceries.

The answers to these questions appear to vary with each company operating a blockchain, but Marcus Schmitt, CEO of Copytrack has provided an explanation as to how it will work with Copytrack.

JP - I understand that tokens may be used to license images. Is there a separate operation that accepts dollar transfers or credit cards payments and converts them into tokens in the customer’s name?

MS -Each client will have a wallet at our system. Clients as well as opponents (rights infringing parties) will have the choice of payment by paypal, credit card, transfer or CPY-tokens. However one of the reasons why CPY-token makes sense is, that the payment will be faster and MAINLY we avoid fees. I.e. if we have a rights holder in the US and an infringer in Japan, the Japanese pays to Copytrack and the bank takes 20-30$ fees - then Copytrack pays to the rights holder and another 20-30$ bank fees apply. With CPY this is eliminated and the rights holder will receive more money!

JP - Is there a fee for conducting such a transaction? How much?

MS - The fees of crypto-coin transactions are minimal - only a few cents compared to 20-30$ for a bank transfer.

JP - Is that transaction instantaneous? (Bloomberg reported that due to Bitcoins popularity in December sellers had to wait hours and sometimes days for their transactions to go through, or pay an average $55 fee to jump the line.)

MS - The transfer will be almost instantaneous. Since we are not depending on the large blockchains like Ethereum or Bitcoin, we can control that pretty good and expect a transaction to take no longer than 1-5 minutes.

JP - If the fee for purchasing an image is $10 can the customer purchase tokens for exactly that amount, or is there some higher minimum purchase?

MS - The payment structure is not yet finalized. But as you know at Copytrack I always had a focus on easy to use, free to use and fair service. This will continue at the "Global Copyright Register". The register and the upload of images will remain free, just like our existing core business, Copytrack Image Search & Copyright Enforcement“. So I will take care that there is no minimum or maximum purchases.

JP - If the customer has purchased a token with a value of $100, but only wants to use $10 of that value to purchase an image is that possible?

MS - CPY-token is just like USD. If he has tokens of 100$ value and spends tokens of 10$ value he will have tokens left of 90$ value.

JP - Does the value of the tokens the customer has purchased, and is holding, vary from day to day?

MS - Yes. The CPY-Token is a currency, just like USD or EUR. The external exchange rate will be regulated by the market by the exchanges, we are listed. However we will take care, that within our platform the pricing of licenses will be bound to fiat currencies and be independent of maybe volatile crypto-currency.

JP - Does the cost of tokens vary from day to day?

MS - Yes. I think the previous answer already answers that. However, if a photographer sold several licenses and received CPY-tokens and now wants to change those into EUR or USD, he has to have a look at the external exchange rates. But its pretty much the same as if he would receive USD and now wants to exchange those into EUR. We even consider to integrate a direct exchange function into the photographers account in order to make it super comfortable for him.

JP - When the customers uses a token valued at $10 to purchase an image and transfers ownership of that token to the image creator can the image creator immediately exchange, or transfer that $10 to his bank account?

MS - This is answered above already - yes he can.

JP - Is there a service fee for such a transaction? How much?

MS - Service fees for crypto currency transfers or exchanging are quite low - a few cents.

JP - If the image creator leaves the token in his account before changing it to dollars will its value vary?  Is it possible for it to be worth more or less than $10 when the token is finally converted to dollars?

MS - Yes - just the same like with USD and EUR…if you convert USD into EUR today, the rate will be different than next week.

Copyright © 2018 Jim Pickerell. The above article may not be copied, reproduced, excerpted or distributed in any manner without written permission from the author. All requests should be submitted to Selling Stock at 10319 Westlake Drive, Suite 162, Bethesda, MD 20817, phone 301-461-7627, e-mail: wvz@fpcubgbf.pbz

Jim Pickerell is founder of, an online newsletter that publishes daily. He is also available for personal telephone consultations on pricing and other matters related to stock photography. He occasionally acts as an expert witness on matters related to stock photography. For his current curriculum vitae go to:  


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