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KUPKrush Single Use Paper Cup Circular Economy Recycling

This idea is a part of Circular Innovation City Challenge

March 17, 2021

The best way to understand the objectives and business model of the KUPKrush initiative is by watching this live video presentation that describes the problem, the business model and the solution;

"600 Billion Reasons Why", available on YouTube in English or German.

Making our Cities "Smart" means adopting more efficient management of services and turning cities into enablers of innovation, economic growth, and well-being. We can only do this by breaking the current vertical data silos, building solutions that provide a holistic picture of what is going on in the city. This project merges data from multiple verticals to provide an open-source, end-to-end, federated public data commons for recycling. 

Deposit schemes throughout the world have demonstrated the power of these programs to reduce post consumer waste. However, without vibrant markets for the waste materials that are collected, circular economies cannot thrive.

As the General Manager of Solid Waste Services for the City of Toronto, Matt Keliher, told CTV News, "Every material that is recyclable has to have someone who wants to purchase it or it’s not recyclable." - the KUPKrush project inverts the current waste management business model by focusing on creating a vibrant market for the waste cup feedstock for the benefit of the entire ecosystem. In the process we create massive amounts of useful data that are part of an open data commons and which belongs to the City and the community for complete transparency and insight. This inversion of the traditional business model is truly revolutionary.

Few food retailers are willing to fund the additional costs of purchasing single-use cups that incorporate paper stock with high levels of recycled fibre - refillable cup programs have generally only achieved modest acceptance and are not even possible with the existence of the Covid pandemic.

So-called Latte-Levies or extra charges for single-use paper cups do nothing to ensure that the used cups are collected so that they do not end up in landfill. These "taxes" hurt the consumer, the retailer and don't reduce the amount of waste destined for our shrinking landfill capacity.

The KUPKrush initiative uses the latest Distributed Ledger Technology embodied in the fee-less IOTA cryptocurrency to make each cup its own economic agent through the concept of a Digital Twin, rewarding every actor in the circular economy with a micro-reward as the cup moves through the recycling chain until it is ultimately recycled into a new cup. With no miners and no transaction fees this technology, designed for the Internet of Things is environmentally friendly due to the absence of the wasteful Proof of Work requirements of blockchains such as Bitcoin or Ethereum and without the need for "miners" or "validators"  there are no fees which makes the required micro-transactions possible in a way that older blockchain-based systems cannot match.

The system is funded through a value transfer (approximately 25 cents) that is transferred to the cup's unique Digital Twin account at the point of sale with rewards then paid out to every player as the cup moves through the circular economy from consumer, to waste-hauler, to pulp mill and finally back to the cup manufacturer, resulting in lower costs for recycled cup stock and therefore for cups containing high levels of post-consumer waste. It's important to note that rewards are only paid out to participants in the network as each cup moves to the next step in the circular economy. By acting "selfishly" each participant guarantees the movement of materials along the "reverse supply chain" towards their ultimate recycling back into new subsidized cupstock that can be sold to retailers for less than cups made from virgin fibre.

Data is collected at every stage, tracking the effectiveness of the program at the individual cup level, providing complete transparency via an Open-Source, Public Recycling Data Commons that will benefit all players. Fee-less Smart-Contracts release the embedded deposits for any cups not entering the recycling system within a predetermined period (nominally set at 30 days) with those funds being transferred directly to the municipality where the waste was created, and thus paying for the cleanup of the environmental waste created by the retail sale of the original product.

The collected data is self-auditing, immutable and open to public scrutiny directly via the public ledger or via APIs to ensure compatibility with Open Data Standards and Open Government initiatives. The collected data can be used as an input stream in data marketplaces and will be developed to comply with data standards being developed for the Industrial Internet of Things by groups like the Open Management Group (OMG) and the Eclipse Foundation.

Examples of the type of data that can be collected and shared in realtime by this system can seen in this slide image, however the data we can collect is by no means limited to just what is imagined here and will be enhanced and extended in cooperation and collaboration with the ecosystem partners.

The entire system is fully self-funding, generating significant revenues for cities (to the extent that adoption is below 100%) and will completely pay for itself within 12-24 months. This solution is only possible with a Distributed Ledger solution such as IOTA which does not rely on miners or transaction fees and is therefore free to operate for both micro-value and data-only transactions, unlike blockchain-based systems.

The solution is described in more detail in a video presentation called "600 Billion Reasons Why", available on the bIOTAsphere website or YouTube.

If your innovation is very technical, please explain it in layman’s terms

At Point of Sale, a cup of coffee or tea (or other hot/cold beverage sold in a paper cup) is scanned and a deposit of 25 cents/eurocents is transferred to the account of the cup via a QR Code printed on the bottom of the cup.

After drinking the contents, the cup's QR Code is scanned by a KUPKrush machine which ingests it and refunds a portion of the deposit to the consumer and the retailer. As the cup moves along the recycling chain the balance of the deposit is paid out to the various players.

Who are your competitors, and how do you differ from them?

Current "Deposit/Refund" schemes require massive investments in auditing and provide no transparency around what is actually happening to the items within the system or the proportion of items that are recycled. The KUPKrush solution is a fully digital and decentralized solution that provides an immutable public ledger showing the efficiency of the system at every stage - recycling rates by brand and store, proportion of cups that are recycled by consumers and their movement through the system.

Who are your customers or target group, and how are you planning to reach/engage them?

Retail Coffee Chains and vendors of hot/cold drinks. Retailers are unlikely to adopt this technology without Extended Producer Responsibility legislation from Cities looking to reduce the burden of consumer waste on the municipal and environmental landscape.

Today there is little demand for paper cup waste by pulp mills and cup manufacturers and so most cups end up in landfill. By using the cup deposits to subsidize pulp mills and cup makers we can create lucrative markets for used cup stock.

What are your most significant barriers for getting your innovation into the market?

Getting forward looking cities to see that using new technologies to solve old problems, we can turn a burden in to an opportunity to generate significant new revenue sources and provide significant sources of lucrative data that is accurate, and transparent while being completely privacy compliant.

This solution is fully self-funding & sustainable and turns the existing business models around waste upside down. The principles of this program can be extended to other areas of waste management.

How does your innovation relate to our Innovation Challenge?

The KUPKrush platform creates a self-funding, circular economy for paper cups and cup stock reducing the pressures on municipalities and mitigating the significant environmental burden of virgin cup-stock creation and use. It will have a big impact on consumer behavior and reduce the environmental waste that has attracted significant publicity in recent years. The technology that makes it all possible is available today and it can be rapidly implemented and scaled.

What positive impact will it have for cities and their citizens? Use specific data and numbers where possible

It is estimated that 600 Billion Single Use cups are sent to landfill globally each year and these numbers are growing. This project will be a significant Corporate Social Responsibility win for participating retailers and a significant source of revenue for municipalities who currently have to fund the disposal of cup refuse from taxes.

Our proposed pilot project using just 60 million cups in a major urban centre will fund the design and manufacture of 100 KUPkrush units and is anticipated to generate nearly $6 million or €6 million for the participating municipality assuming only a 20% participation rate. The system generates revenue for education and marketing and is completely self-funding.

The amount of data collected, that becomes part of a municipal data commons is simply staggering and provides self-auditing immutable records about its efficiencies and results. KUPkrush machines can additionally collect air quality and other metrics at no additional cost.

Who would be relevant collaboration partners in helping your innovation succeed?

Municipal Waste Management Departments, Retail Coffee Chains, Fast Food Restaurants, Pulp Mills, Cup Manufacturers, Waste Aggregators etc.

We envision a collaborative governance board consisting of an alliance of all players in the ecosystem as well as members of the public and city/regional government representatives (represented by the entity named FISC in the presentation) to determine the best way to make the system work for everyone.

What year was the innovation initiated?


Country of registration/origin?


Where is your current funding coming from and how long will it support activities?

The project will be crowd-funded by issuing Digital Assets as non-fungible tokens (NFTs) on the IOTA Tangle. Investors will buy the rights to future revenue streams generated by fractional ownership in KUPKrush units which should be cash-flow positive soon after deployment. We expect to receive grant funding from a variety of sources if KUPKrush is adopted and implemented in any Smart City initiatives.

The IOTA Foundation has also issued a Letter of Support for the project (see Public files).

What are your future plans for sales or funding?

The project is currently at the prototyping stage awaiting interest from one or more Smart City initiatives. Initial unit design has begun and alpha coding of the software platform and the associated applications has started - it will be relatively simple to ramp up this process as soon as we get interest from one or more participating cities and get feedback on the scope and speed required for an implementation.

What is the setup of your organisation and management/board?

The bIOTAsphere is currently established primarily as a think-tank with a core team of passionate executives. Once we obtain interest from one or more Smart Cities we will move forward with design and deployment of the machines in partnership with the waste-management departments of the cities that are interested in piloting the initiative.


Submitted by noahzuck on March 19, 2021

This seems to be one of the perfect uses for blockchain technology I have seen to date. This solution should be widespread and ubiquitous already and I can’t believe it hasn’t already been thought of and implemented! Having worked with the public sector in Canada, this is exactly the type of Mandate certain provinces are looking for to make an impact both on ESG mandates but also establish them as a leader in the technology and innovation space! Well done and I hope to see this implemented sometime soon!

Submitted by Holger Webel on March 19, 2021

I really enjoy reading the idea and seeing the presentations. This is how i can imagine sustainable cities will reach key goals in changing the current unproductive structures. I think the verification and connection of the cups in digital twins and the immutable open source and decentralized solution that the IOTA Foundations Tangle technology can provide here is not to be underestimated. It creates reliable revenue streams for the partners of the solution and provides data that can be trusted. And the possible total automatisation in the execution of the payouts through the solution will make it easy implementable without to much administrative work for the partners. Smart cities will be measured on how effective they keep resources cycles running and an innovative feeless solution that collects and stores those datas is key for innovation. Industries and the public sector are looking for such solutions. Myself seeing everyday the mismanagement that is going on regarding waste, single use cups, drink packs etc here in Indonesia and also being a professional diver that loves the ocean and sees where the plastic waste of the world ends up i have to say that every piece of plastic and waste that stays in circulation and not ends in our oceans and food-chains is worth to be saved. Innovative cities play a key role in developing this and waste management and resource circulation is key to that. Using a DLT based data driven solution that keeps track and provides revenue in a reliable immutable way is the only logical step forward for me. Congrats on the idea and hoping we can see this roll out in the partner cities and later in more and more parts of the world.

Submitted by Carpincho on March 20, 2021

I saw your presentation live and since then I was completely convinced about how needed these sorts of solutions are. The circular economy is about incentivizing people to behave in a way that is convenient to all parties involved. The path you propose is an extremely elegant solution to cope with the problem. And the best part is that the technology is already out there waiting to be used. I wonder who is going to be the first one giving this revolutionary step. Good luck with the challenge!

Submitted by rlloque on March 20, 2021

It is a road of thousands, millions of ideas, concepts and invention that lead all of us towards a brighter tomorrow. I believe that your idea can be on of those steps.
Easy to implement, elegant and with an incentive for every party in the circle.

Submitted by Mirnow on March 20, 2021

It's an incredible use case for making the world a better place. The KUPKrush project is a win-win situation for all participants in the cycle. In addition, this cycle principle could be transferred to other applications.

Submitted by Karlw on March 20, 2021

I come from Stuttgart / Germany, the country of the returnable bottle, and I have to say that the principle convinces me.
We mostly use the deposit system for glass and plastic bottles. The addition of coffee mugs optimally completes the approach to resource conservation. The effect that such a deposit system triggers should also not be underestimated. On the one hand, of course, it obviously contributes to better utilization of the cup. In addition, however, it ensured that society began to react more sensitively to the topic, which ultimately initiated a "learning process".
You no longer just throwing everything in the trash, but instead you look at how you can best recycle it (because you could get a reward).
The perfect system that can contribute to a clean environment in the long term and in combination with the IOTA technology, fits perfectly into the future area of ​​Smart city.

Submitted by JosephS on March 21, 2021

I live in South Australia, a state which leads our country in recovery, recycling and litter reduction of beverage containers (bottles and cans), with an overall return rate higher than 75%. This is with only a 10c refund (to the consumer). A 25c premium on cups / refund on recycle scheme (in the format described by KUPKrush) would likely result in an even higher % of returns as it will encourage more participants in the ecosystem to make it easier for consumers to do the right thing.

If it can be tracked through a distributed ledger, we can collect all sorts of other metadata that could increase transparency and help us understand where it is working, where it isn't working, where the system could do with tweaking, allowing stakeholders to adjust the program accordingly.

Given the incredible waste we are creating with single-use paper cups, I don't see this proposal as an 'idea', but more so an inevitability if we are going to play our part in maintaining this planet for future generations.

Submitted by Herbert on March 21, 2021

I'm always flabbergasted when I read how much of what we think is recycled is actually not at all recycled and becomes garbage/pollution. I live in Vancouver and a few years ago I read that on average the city's recycling waste (don't remember if it was a specific category) made 7 hops before it reaches it's destination. There is no real tracking as to what happens after hop 1 as the city is only responsible for the first hand off. From thereon we just need to trust that the industry does the right thing.

Looking forward to seeing the full lifecycle of waste/recycling being recorded in a DLT and love how every party along the recycling supply chain gets rewarded to do the right thing.

Submitted by al_scot on March 21, 2021

Whilst I'm not as technical as I would like to be, I'm delighted to see someone that has a vision and a practical solution to a global problem. I'm old enough to remember barcodes being an annoyance at the local supermarket, yet look how quickly they were adopted and adapted. The use of a DLT here makes perfect sense, and one can imagine how the same concept could be adopted by all recyclables in theory.

The incentive for each segment of the chain to participate is key, as is the permissionless nature of the project. If the cafe over the road can take part with an order of cups and a smart phone - they are in.

I remember watching the presentation last summer, and glad to recap some of it now.

Good luck Terry.

Submitted by Holger Köther on March 21, 2021

Terrys proposal - and its solution - it an extraordinary step towards tackling our societies challenges of daily waste management and environmental protection.

Albert Einstein once said "You can tell a really good idea by the fact that its realization seems impossible from the start" and when thinking about the amount of paper cups used everyday it looks like an overwhelming ant hill (or better ant mountain) of challenges that come with solving waste management issues on the last mile.

Through his practical approach and the clever use of modern technology Terry is able to close the gaps where others have failed before. His solution is not only a simple and efficient one, but most importantly it's not a dream castle in the cloud. This solution can be developed TODAY by combining a set of simple processes with the right technologies to enable a new type of micropayment incentivation with a device we already carry around - our smartphone - and thus convenient for the most lazy or hurried citizens as well. It's not only a "green" proposal for environmental sustainability in itself but utilizes "green" technologies from the bottom up.

KUPKrush is a strong and simple proposal for the betterment of our planet and should have started already "yesterday". I am looking forward to seeing it implemented in a growing number of hotspots, cities and regions.

Submitted by Chris_Mueller on March 21, 2021

As a long-time fan of Distributed Ledger Technology (DLT) and host of the weekly YouTube show called "HelloIOTA Roundup", I have to say that this is by far the most innovative Smart City solution I have come across yet.

It not only shows what cutting edge technology like IOTA is capable of due to its feeless nature in combination with its Digital-ID framework, but it especially makes environment-friendly solutions tangible for citizens and companies alike by incentivizing sustainable behavior.

If you want a nice solution limited to a single city which saves some costs here and there, go with any project you like.
If you want a solution which interconnects various companies and industries (theoretically worldwide) by means of the most advanced and soon to-be-standardized DLT at practically no transaction costs, but in a tamper-proof and extremely fast way, make sure to get in touch and learn how KUPKrush works - the idea is as brilliant as its inventor Terry Shane.

Once established, this could easily be used as a blueprint for many cities to follow - not because it is based on some nice tech, but because it offers - for the first time in the history of recycling- a win-win-solution for all the parties involved in the circular economy.

TL;DR: KUPCrush is ingenious - and you can start building it today, the tech is available for free!

Submitted by IgorNilsen on March 21, 2021

Smart cities are the future of our society. And Terrys proposal is a great idea how to solve everydays challenges with the use of cutting edge technology like IOTA.

Well done Terry!

Submitted by matthias_ on March 21, 2021

To live a more sustainable live, we should also think much more about circular economy and how we can improve there. There are certainly many approaches and we need much more of them, to incentivice everyone to be part of the circular economy. This project is a great example of how tech can be used to fairly distribute these incentives over the whole cirlce and therefore build an inclusive model of how to get more people into recycling and the cicular economy. Great Job.

Submitted by smartcity on March 22, 2021

As a civil engineer and senior leader working in a municipal environment for the past 20 years, I can attest to the absolute need to develop smarter cities. In my opinion the timing is urgent to ‘disrupt’ and ‘reformulate’ the business as usual approach to the delivery of city services in order to deliver improved level of service at lower cost to the tax and rate payers.

I have watched many municipalities set ‘aggressive’ recycling targets and either (1) miss these targets entirely, (2) plateau with limited gains even with significant public education and engagement programs, or (3) celebrate when 60% recycling targets are reached when we should troubled by the other 40% we’re missing.

So congrats to Terry on the development of the KUPKrush project. The use of distributed ledger technology to provide an incentivized program for all parties in the cup’s circular economy is brilliant. The use of IOTA as a feeless DLT is obvious as the only viable approach to manage these small transactions. The data collection opportunity and ability to analyze and adjust rewards to further improve recycling is another great benefit of using a feeless DLT that will be able to scale to a level that will handle the significant transactions.

Terry’s project now has me dreaming up a number of other use cases! Smart cities here we come!

Submitted by Kevin Young on March 22, 2021

What I love about this project is that it considers every step, from the manufacturing, sale, use, and recycling and finds a way to provide incentives to every user. It truly is a win, win, win, win solution. It seems modeled on nature, where the waste of one step feeds directly into another cycle.

This project seems very feasible and would be a flagship of just what is possible, benefiting the manufacturers, the users, the recyclers, and the planet.

Submitted by kristofvdj88 on March 22, 2021

This project beautifully illustrates the transformative potential that a feeless distributed ledger technology like IOTA brings to the table. its feeless and permissionless nature are at the base of this and enable current models to be redesigned, by learning the behavior of the model participants and introducing or optimizing new economic incentives.

I believe this project truly has a viable solution in that it can potentially change the behavior of the current ecosystem stakeholders via these new economic incentives that are introduced by using DLT at the heart of this solution. This would be transformative and would have a very positive impact on earths ecosystem to say the least.

I myself work as a software engineer for several companies, among other Fost Plus is one of these. They are the regulating body in the field of sorting & recycling in Belgium.

Submitted by RicardRoyo on March 22, 2021

Great project! Attaching a monetary redeemable value to by-products is a common way to incentivize recycling them, but this project does it in a much better and clever way. To me, the differential aspect is the use of a feeless, open DLT instead of a centralized system. This, not only incentivizes participants every step of the way, but it does so in a way that it promotes the development of open competitive markets throughout the whole chain. By using an open permissionless technology, new participants with more efficient processes can join the market and compete with less efficient players, leading to a better use of energy and resources over all. 

Submitted by Valerie Swatkow on March 22, 2021

I worked for years with the world's leading QSR and I can speak first hand about the toll discarded cups have on a brand's reputation. When gutters and ditches are filled with your logo, it angers people and they place the blame at the producer's feet. So, not only does KUPKrush solve a huge environmental issue, but it also provides a solution to the negative impact on brand perception that littering creates. A full closed circle is the only solution to correct this global issue and KUPKrush has nailed it. We need this in our world asap!

Submitted by petew on March 22, 2021

This is a fantastic showcase of the disruptive power of Distributed Ledger Technology, solving environmental problems by bringing together and incentivizing multiple stakeholders in one ecosystem.

I watched the video presentation and was amazed by how well thought out this idea is.
As a Dutch citizen I'd be really excited for this project to come to Amsterdam! I'm not a programmer but I would actually love to help out with the execution of this idea, promoting and presenting it to others here in the Netherlands. Feel free to reach out Terry!

Submitted by idontlikeusernames on March 22, 2021

The difficulty of trying to ''do good'' in a world that so highly values capital accumulation, these kind of solutions make the right thing the easy and profitable thing for all parties involved. That is the beauty of this kind of solution, it is pragmatic in nature and solves a political, ecological, social and financial need. The road of least resistance should be the road that builds towards a future, sustainable circular economies, not pollution and blind capital accumulation.

Submitted by BenRoyce on March 24, 2021

Many of us are motivated to do a simple common good simply because we are aware of the environmental and societal stakes. A project like KupKrush gives that little extra oomph to those who do not immediately appreciate nor are aware of the why and the how.

The costs of unsustainability are bourne outside our every day senses in typical city/ suburban life, the costs that are hidden from us. KupKrush uses microtransactions to make the usually hidden and unseen visible, quantifiable, appreciable. And incentivizes us to participate in an easy way to make a real difference en masse.

This is how you do good in the world!

Submitted by tempus on March 24, 2021

This is a great and detailed vision of how things need to be done in order to make the world a better place and make our habits a little less destructive and more sustainable. In order to improve the recycling process we definitely have to create economical incentives for the end consumer to do it and to make big companies take also more responsibility as the trash they produce can now actually be traced and get them into trouble in case they are not doing their part. For us, for the sake of our kids and the following generations, this sort of ideas need to be explored with the backup of our governments. Hats off to Terry for coming up with it and putting so much effort in making sure it is given a shot to make it work. Cheers from the Netherlands

Submitted by hamster on March 25, 2021

CUPKrush tackles an important issue of our times using advanced technology and game theoretical aspects that should work together great. The project has my full support. Good luck going forward.

Submitted by MarkAK on March 25, 2021

Really like the idea, there is a big snowball potential where other industries could follow and in result make our planet greener without sacrifice.

Submitted by ryan2580 on April 19, 2021

The amount of value this brings all involved parties is incredible.
Value for the involved parties but solving a real problem for the environment.
It's a massive selling point for a coffee chain to promote to an ever increasing environmentally conscious public.
Very impressed and I hope this gains traction.

Submitted by wadada on April 19, 2021

I like the idea to NOT Shoot at a fly with a missile. Using the most ecologic DLT is great.

Submitted by gman214 on April 21, 2021

Terry has worked through all aspects of why current programs don't work. The way to change behavior is to make recycling profitable for all constituents in the supplychain and ecosystem.

This may be the first recycling effort that truly solves the issues, the first to truly work. I fully endorse this initiative. Bravo!

Submitted by hassping on April 22, 2021

The circular economy is desperately needed and this project has it by definition. The proposed payment protocol makes totally sense because is permissionless and feeless, so the solution wouldn't be viable without this technological component.
Super excited to see it implemented.

Submitted by @_JeffR on April 22, 2021

KUPKrush is the very definition of Circular innovation.

The core tenets of capitalism dictate that companies must make a profit to sustain their operations. This fundamental concept applies everywhere, including recycling businesses. The unfortunate reality we face is that these recyclers opt out of processing paper cups because it is simply not profitable to recycle them. These cups typically forego recycling and end their life in a landfill, adding to the ever-growing mass of waste discarded by humanity. By incentivizing both people and businesses alike, KUPKrush makes it feasible to recycle these paper cups in a sustainable manner. This not only applies to the recyclers, but to every entity taking part in the lifecycle of the cup.

KUPKrush provides the exact incentive required to create a sustainable ecosystem. It is built upon a public, permissionless, and feeless ledger, where all parties have visibility and equality in the economic lifecycle. This idea is not limited to simply paper cups. While this specific project is brilliant in itself, the *framework* outlined here is the true value proposition. The potential impact to human society should not be overlooked.

Submitted by antonionardella on April 23, 2021

This project is the expression of a collaborative technical solution that aims to reach an equal proposition for the participants and an environmentally sustainable process and in my eyes this really stands out.

KUPKrush is in my opinion a prime example of what a creative and entrepreneurial mindset can bring to the table with a permissionless, open source and fee less technology like IOTA.