About four months ago we announced our plan to implement an incentive program on cryptonize.it utilizing colored coins. At that time, there was very little talk about potential token solutions on Bitcoin Cash and OP_GROUP seemed like the fastest way towards it, we were wrong.
After developing CashPay and adding the Spend and Replace feature, Cryptonized Cash (CC) is the next addition to our growing list of ‘firsts’. As of today, we’ve started the first iteration of the Cryptonized Cash (CC) incentive program on cryptonize.it Users get Cryptonized Cash (CC) accredited for buying any Bitcoin Cash merchandise. Receivers of Cryptonized Cash can use it to get discounts or buy CC exclusive products. Further utility will be added as cryptonize.it grows. There will be a total of 1 billion CC, without the ability to add more in the future. The tokens are always redeemable on cryptonize.it
The Colored Coins protocol
The Colored Coins protocol started in 2013 as a method to push metadata to the Bitcoin blockchain, and evolved over the years to an ecosystem for digital tokens.
Colored Coins creates a framework for digital tokens on Bitcoin (Cash). It’s 100% open source, on-chain and ready to be used right now permissionless.
Use-cases
One of the most important questions to answer when proposing adoption of a certain framework is what are the use-cases? Luckily with colored coins, the answer is endless. Colored coins can represent vouchers, coupons, tokens, altcoins or other assets. You can tokenize whatever you want.
The first real-world use-case is Cryptonized Cash (CC), an incentive program on cryptonize.it which is live right now. It rewards customers with CC which can be redeemed to buy products at a discount the next time you order.
SPV friendly
The Colored Coins protocol is SPV friendly in the sense that most wallet providers will not have much difficulty implementing it. Wallets like Electron Cash already have most infrastructure in place. The CashPay wallet will enable colored coins to allow users to issue and store colored coins, but Colored Coins can also be used with a web wallet. Colored Coins are very easy to integrate into existing wallets and we expect that other wallets will start to support Bitcoin Cash tokens in the near future. More information on how to implement colored coins can be found here: https://github.com/Colored-Coins/Colored-Coins-Protocol-Specification/wiki/Benefits#support-for-thin-wallets
Testnet implementation
The Colored Coins protocol will be available on testnet within days. The implementation will have a wallet so anyone can try out coloring coins and will soon be followed by livenet including a wallet and explorer. Check out the Cryptonized Cash website for more information.
 

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Comments
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>SPV friendly How exactly can it be SPV friendly when miners do not enforce token rules? Or is it "light wallet friendly" in that you trust a connected node to do the verification like all other op_return based protocols?
Edit: Upon further reading of specs: "the one used by the new colored coin implementation is that of keeping full history only about transactions involving addresses owned by the wallet. The thin client will backtrack through blocks all the way to each asset issuance and keep only that data. In other words, the wallet just needs to know the subgraph of transactions that lead directly to the assets in the wallet."
This is... not SPV. It's easier to run than an entire full node, but it's not exactly light, in the same way that Neutrino is not. Interesting approach though, should make the burden of running a full node quite a bit lower.
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@im_uname This was true but we made some modifications making it possible for SPV to do quick verifications.
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Excellent stuff Ari. I think it's a no-brainer that this would naturally be a 'first' step in bringing tokens to BCH... It's permissionless and can be done now. No waiting or debating. You have the infrastructure to do it, and you're taking initiative. We need more of this.
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I didn't understand anything! I read this guide https://bitcoinbestbuy.com/what-is-bitcoin/ than came across this article. Really, how does bitcoin can be colored?!
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This is really awesome! I definitely want to play with this so I can make reward points for my business and help other businesses setup their own tokens! Bitcoin Cash really needs a token system because how can BCH compete with banks when you have Google and Apple backing them up by integrating Payments, Rewards, etc in their own apps. Tokens are an order of magnitude better than some permissioned app and opens the door to small businesses who want to basically create their own rewards systems on the cheap. With rewards, coupons, tickets, assets, and more possible with Bitcoin Cash, now we have a brand new selling point on getting businesses and regular users to adopt it. Thank you for all the work you've been doing on this. I'll be spreading the word! :)
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Will CashPay also be able to support other tokens when you release with Cryptonized Cash support?
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