In the last six months, HypeDrop has grown expansively. To ensure that our overhead costs are met, we need to make some important updates to our affiliate system.
In August, after considerable user feedback, we introduced crypto withdrawals to our business model. This feature has allowed multiple users to exchange their unboxed items for crypto currency. Yet, as of late, its rate of use has almost met an equivalent rate of deposits. After promotional costs have been deducted - including deposit bonuses, affiliate commission, daily free boxes and sign up bonuses - insufficient amounts are left to cover the vital costs of running the business.
Initially, HypeDrop was modelled after our sister company, CSGORoll. But the introduction of crypto deposits and withdrawals has proved the models to be entirely different. Unexpectedly, the rate of deposits and withdrawals has been vastly similar, meaning that our current rate of 10% commission for all deposits has eaten a huge chunk of our margin.
HypeDrop is a huge logistical operation; to ensure our survival and continual growth, we need to alter our strategy and affiliate system. Moving forward, we have no choice but to make the maximum affiliate tier commission 6%; the same relative changes have been made to all other tiers.
On top of this, we originally enabled unsupervised crypto withdrawals. However, this had many unforeseen consequences. A group of sophisticated users were able to exploit our RNG systems, and withdraw millions in crypto currency. This lead to huge financial expenses and created a highly stressful environment for HypeDrop management, who were forced to put their all in to data analysis and balance reconciliation.
From now on, we have enabled withdrawal approvals alongside our new card processor for added security measures. This tier 1 card processor has replaced G2A Pay; with much higher acceptance rates, users who were previously unable to deposit will now be able to. In turn, our affiliates have the opportunity to earn more commission than ever before.
Not only this; we've also made it possible to instantly withdraw affiliate commission via the exchange option. Now, your affiliate balance will count towards available credits which can be used to purchase items from our inventory, so long as you're in the maximum tier.
We're also planning on launching a new game, and improving our Daily Free Drops so that you can collect rewards faster than ever, without having to wait to reach the next high level. Stay tuned!
Implementing these updates has been an incredibly difficult decision to make. But it will have multiple benefits in the long run. It will rekindle a relaxed work environment for management, allowing us to put our efforts back into creativity. It will also ensure a continued deliverance of a high-standard service.
As always, thank you for your understanding in this update. And thank you for being part of our incredible community. We're happy to listen to any feedback or suggestions you have.