How does Amp (AMP) help eliminate problems in online commerce?

These problems are especially acute for businesses that end up incurring higher costs. For example, according to statistics, fraud alone costs companies millions of dollars annually: the Association of Certified Fraud Examiners (ACFE) estimated the average loss for each of the 1,921 companies surveyed at $1.6 million. These problems are what Amp developers are trying to solve by taking advantage of blockchain technology.

What is Amp?

AMP is an ERC-20 token issued on the Ethereum blockchain in September 2020. Amp token developers aim to create a secure and efficient ecosystem for digital payments in online commerce.

Such shortcomings of the existing financial system, such as high fees, difficulties with transactions, long waiting times, and fraudulent payments, led in 2019 to the creation of Amp — an efficient payment solution based on decentralized blockchain technology and tokenomics. In September 2020, the project team released the AMP token itself. The creators of Amp seek to protect both companies and ordinary users — end consumers who need to pay for goods and services.

The token appeared at the most opportune time — during the heyday of the decentralized finance (DeFi) market, which contributed to the rapid growth of the ecosystem of this project. As a result, at the end of 2020, the value of the AMP token began to grow rapidly and, in January 2021, reached its all-time high (ATH) at $0.12.

As of December 2024, the value of the AMP token is $0.0099, which is almost 92% lower than ATH. The reason for this decline was the general negative dynamics in the crypto market, which was exacerbated by several events, such as the Terra blockchain ecosystem collapse and the distribution of funds to affected investors of the Mt. Gox crypto exchange that went bankrupt in 2014.

Nevertheless, the price of the AMP token has risen 165% over the past year amid the crypto market's recovery. AMP ranks 129th in the overall cryptocurrency ranking by capitalization, which is $807 million.

How does Amp work, and what is the token used for?

Amp is part of the Flexa blockchain ecosystem, a decentralized payment network that enables fast and secure cryptocurrency payments worldwide.

The developers of Amp and Flexa are trying to eliminate several problems common in online commerce, such as:

1. Lengthy transaction processing. Every online transaction goes through a chain of confirmations. It can take several days to process, for example, due to a delay on the side of any of the intermediaries, an error, or a system failure. All this can also lead to delays in order fulfillment, which negatively affects both companies and end consumers.
2. Intermediary commissions. Online payments go through various systems, such as Visa or Mastercard, which charge an intermediary commission. This commission can range from 1.5% to 3.5% or even more of the payment amount. This increases costs for businesses and ultimately affects the final price for consumers.
3. Fraud. Cases of payment fraud, including chargebacks, are prevalent and raise concerns for sellers and buyers. This ultimately leads to delays in the delivery of services and goods. According to Merchant Savvy analytics, card fraud losses worldwide are estimated at $35.8 billion.

Thus, the Flexa payment network allows merchants worldwide to accept online payments directly in cryptocurrencies, helping to solve the above problems. AMP is a native token integrated into Flexa's payment solution, but Flexa allows payments to be made in other cryptocurrencies, such as Bitcoin (BTC) and Ethereum (ETH).

Buyers and sellers can use AMP tokens to pay for goods and services and accept payments respectively but features such as:

• Stacking. Users can block a certain amount of AMP tokens and earn additional income from it;
• Lending. Buyers and sellers can use AMP tokens as collateral and receive credit for other digital assets.

Does Amp have any prospects?

In 2023, Crypto Payments Industry Research estimated the revenue of cryptocurrency payment providers at $338 billion with a compound annual growth rate of 10.3%. However, at the same time, according to Vantage Market Research, crypto payment applications are expected to grow at an average rate of 13.4% from 2022 to 2028.

According to data posted on Flexa's official website, more than 40,000 merchants worldwide use Flexa's payment solution, including major companies like GameStop and Nordstrom.

If Flexa survives the competition and maintains its position, it will positively impact this AMP ecosystem token in the long term. Of course, under favorable conditions in the crypto market as a whole.