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ICO Analysis: BitClave

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A brief survey of the companies making the brunt of the bucks online yields Google as a primary result, and other search and data companies not far behind them – Facebook knows at least as much about a given person as does Google. “The people are the product,” goes the adage, and it’s less scary than it makes simple economic sense. Without some product to sell, companies would have no reason to offer such advanced and expensive services. In the ICO rush we’ve seen most industries undergo some form of attempted disruption, and now with the onset of BitClave we’re seeing perhaps a new zenith in terms of ambition: at heart, what they are trying to do is disrupt search, perhaps the pursuit of only the maddest technical idealist.

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The Shape of the Pie in the Sky

There are two main things we need keep in mind when considering the mission being presented here.

The first is that the search in and of itself is a nascent industry, and really we’re only seeing the first iteration of its established modes. The era which directly preceded this one in the 90s was marked by dozens of choices, the first of which were maintained by hand, of databases to hunt for information. In reality, access to information was far more democratized under such circumstances, but we’ll not delve too deeply into the cultural dangers of centralized information access. The era of Google has been marked by a single, growing dominant search engine, more automated than not, which knows more about the user than it does at least a few of the user’s queries. In fact, one could argue that 9 times out of 10 the search engine has more information about the user, by nature of using the search engine and its other resources, than it ever does provide about an individual topic to the user. From a fairness perspective, this seems like a bad deal: people act as data crops for a global, faceless data combine and truly do not even get the carrot they signed up for.

The second thing to keep in mind is that there is a great cultural awareness of data privacy, but much like climate change or world hunger, average consumers do not currently have adequate choices which would protect their privacy. The cost of entry is your privacy, people have grown to accept, but they’re more aware of it than ever.

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Studies have yielded conflicting results on the subject of how the current and next generation of decision makers actually view their data privacy. In one, we learned that millenials are largely indifferent. In another, they do care. Both situations only distract from the point the author is making, in any case: this generation is aware that their data is not private. Awareness is not enough. Someone could be aware that they are sitting on an oil well, but that awareness will not translate to action unless they are also aware of the value of the oil within it. This is the only type of catalyst that can lead to success for BitClave, which will allow users to monetize their own data.

Let’s see what the prospects of that particular industry are, that of voluntarily forfeiting private information. Short story: it’s growing, just like everything else online, exponentially. According to a Quora answer from someone who appears to know (Aaron Abram, founder of a survey company), online survey companies are extracting more and more from the economy, paying fractional amounts for people to answer long questionnaires.

The biggest fish in this industry makes $200M+ annually with 50% profit margins. And all the top venture capital firms are throwing money to the tune of $50M to $100M per company. With so much chum in the water, there is a feeding frenzy.

While the data that Google collects and the data that survey companies collect are two very different types of data, the point is that personal information is a huge and growing opportunity. So what does BitClave have to do with all this? Well, as you’ve probably guessed, they want to decentralize and monetize consumer search data and marketing information. At heart, their goal is to allow companies to directly market to consumers who are open to it, but at the tail end of their mission is a sizable disruption in the way people understand search.

BitClave proposes a system in which the intermediaries are eliminated and interactions are facilitated by the network itself. Instead of paying any “middlemen”, companies automatically make personalized offers directly to consumers who have opted in for the service.

The “intermediaries” referred to are the various advertising networks, including AdWords, which separate marketers from consumers. In the proposed system, companies will be able to find anyone who owns a dog, for instance, who is in the system, and offer them a product or service in the form of advertising. If the question has become why anyone would sign up for such a directory, then hopefully your familiarity with tokenization will help you understand: people will be motivated by money to be part of the network.

Incentivized Search Also Not New

What we’re talking about is not Bing Rewards or any of the myriad of search bars that share the advertising revenue with the user. Although at heart that is what we’re going to see happening in BitClave, we’re talking about something much more advanced. The Bing Rewards system, which allows people to earn “points” on their search data toward rewards, still uses the old model of throwing an ad up on a wall and hoping that passers by, who may or may not have a passing interest in the product, will take interest in it.

With BitClave we’re talking about something much more novel and innovative: a way to ensure that said ad only appears to those with a stated interest in it. This frees up capital to sweeten the products on offer, such as samples and trial offers, because when these programs are properly targeted they are scientifically proven to yield more sales.

The Future Is Unwritten

For the purpose of this article, both the author and the reader essentially need to suspend our understanding of the machinations and long tentacles of Google, Facebook, Baidu, and the rest of the aging pioneers who currently own the web for most intents and purposes. We must accept that disruption itself is the nature of technology, and so while it may be hard for us to imagine these companies losing market share in a significant way, we have to accept that it is both possible and reasonably achievable if the correct circumstances have arisen. As BitClave themselves put it:

Markets that stifle innovation are always susceptible to technology-based disruption.

The BitClave Network

BitClave is much broader in scope than mere search, but its first iteration will be directly associated with user activated search. The BitClave software itself is a blockchain layer that records user activities, in a way that the user assents to. The system used for this is called BASE, BitClave Activity Search Ecosystem. This is primarily for the advertisers and data aggregation outfits to interface with, so that they can find users who fit the profile they are looking for. Users who interact with the app are then presented with offers from advertisers who are looking for users that match their profile.

All of this will be operated using the CAT token, not to be confused with the BlockCAT token, which we will discuss a bit more in a moment.

BitClave does not mention the creation of their own search engine, which is a definite plus for the sanity of this project. Utilizing existing search engines, or allowing the user to decide the search engine, is a much smarter approach, removing it from the crosshairs of those firms themselves, but also putting it in a position that other networks can exactly mirror its functions and compete with it on grounds that are not based on their superiority, but instead simple virility and reach of existing ad contracts.

In short, BitClave’s first iteration places a shell over existing user search activities and gives advertisers a direct line to these users. The types of data that can be collected and stored in BASE are many, including physical information like building access, wifi connections, GPS information, and more. All of this data can be useful to advertisers trying to sell products, especially regional products. Through the use of cryptography, actual user personal information can be selectively protected and shared by the user, and the advertisers nor BitClave itself do not need actual personal details (name or e-mail address, for instance) to verify whether an offer actually converted or not.

For advertisers, this is what will be most attractive about BitClave: they are only paying for interactions which actually yield money, a radical and novel approach to advertising that couldn’t be successful in a centralized iteration. This is to say: exactly the type of disruption that blockchain and decentralization are meant to induce.

BitClave Token & Value

The CAT name for the BitClave token is unfortunate because there will be naming confusion between exchanges. In the case of BitClave, CAT stands for Consumer Activity Token. (BlockCat already calls its token the CAT, though.) Nevertheless, the value of the token as a member of the whole network needs to be established.

The high view is that advertisers will use the token to pay for listing on the platform and access to the BASE (along with later products BitClave will develop on the ecosystem) and customers will earn these tokens for their participation.

In design, then, the economics of this system are such that one party will continually be dumping onto the other. BitClave are aware that the system will take some time to develop value for both users and advertisers, and addresses this by saying:

While the true value of the ecosystem will take time to attain, reaching a sufficient number of retail contributors and user participants, we believe there is sufficient value for early adopters of the retail platform. Initial users can start to earn CATs by creating profile details, contributing preference and interest data, and posting recommendations for retailers or providers who have not yet joined the system (potentially earning tokens and reputation from other users in the process) similar to a recommendation or referral system. From the outset, the platform will support peer-to-peer contracts which will provide value in bootstrapping the retail marketplace.

Distribution

There will be 2 billion CAT tokens issued during the token generation event. For the purpose of the token, to be issued out as a token of reward by many different advertisers, we can see this distribution as being comfortably suited. Where Kik’s Kin token decided 1 trillion was an appropriate answer, BitClave apparently decided on an amount that humans can get their mind around.

It’s fun to play with numbers. We could make the following calculations based on some data that’s not available, for instance: if the market is 750 billion in 2025 and BitClave has just 1% of that in terms of advertising dollars, the total of the BitClave network’s value would be around 7.5 billion, and the cost of each token would justifiably be over a few dollars each. Let’s say this was a hugely positive outlook and say they only have acquired .1% of the network in that time – the token is still carrying value, so long as the network provides value to advertisers and advertisers are using it. Thus we find the true Achilles’ heel and metric to judge BitClave by: their speed of adoption and expansion and gathering of significant clients for the advertising services is crucial.

BitClave Team

BitClave have cleverly positioned themselves in Mountain View, California, the home of Google’s main campus. This puts them at the hub of the world’s search technology engineers, among a lot of other talent. Therefore we can safely say that if BitClave funds, CTO Patrick Tague’s odds of finding the engineers to get this thing on the road are pretty high. According to his LinkedIn profile, much of Tague’s professional experience has been as faculty at various educational institutions.

CEO Alex Bessonov formerly worked as a mentor for Tim Draper’s Draper University and has otherwise worked with a number of start-up accelerators. His real experience comes from his time as a software engineer working with eBay, Microsoft, and Informatica. Informatica was a pioneer in data analytics. Of his experience there, Bessonov claims:

Responsible for developing client/server data mining applications. Led the team to design a new generation of Informatica’s client suite.

Not hard to draw a straight line to today, where he is heading up a company which seeks to disrupt the very data mining revolution he took part in starting.

The Verdict

We are bullish on all plays which will disrupt digital advertising. We believe the Basic Attention Token is a few partnerships away from meteoric rises and that adChain will find a simultaneous place to operate from. Of adChain, we concluded that the verification of good providers is a valid play in the advertising space. We feel that BitClave takes this idea to the next level – giving businesses direct access to customers, and charging them when they succeed in making a sale. We figure this will probably go further and represents a more novel approach to the problems at hand.

Risk

  • Team are virtually unknown to us, their connections could be lacking, this could slow adoption even further than the next point. -3
  • Adoption will be slow. The firm will spend a lot of money getting both advertisers and customers on board. They may not raise enough to achieve the goal. -1
  • Will face attrition from other outfits which offer nearly identical product. -0.5

Growth Potential

  • Will be very attractive to the current and future generations, who are aware of their data privacy and will gradually become more aware of its monetary value. +4
  • Initially seeks to co-exist with other advertising solutions, instead of relying on any external activities to really initiate its existence. +3.25
  • The noted attrition in the Risk category is less when you consider that advertisers will only pay for what they actually profit from, which will incentivize them to keep CATs for the purpose of advertising on the network. That said, actual token value will rise slower the less that people use the product, and fall off whenever people move to a different product, so the attrition should not be understated either. +3

Disposition

Numerically, our rating of BitClave winds up being 5.75. AdToken received a 6.25, and they are up for a review soon. A rating of 5.75 should be used mostly in determining whether or not you’re going to invest initially, not the long-term success or profitability of the token. Short-term profitability is there: demand for the token will be immediately represented by firms which want to be on the cutting edge of marketing. Long-term profitability is questionable, since we’re sure that alternatives already exist and will continue to emerge, making a network effect difficult for BitClave to establish. As a general investment vehicle, it seems this one could yield some short-term profits, but has a lot of means testing to do before we can determine whether or not it’s a good long-term vehicle for money.

Investment Details

Details are a bit murky on everything. They’ve opened a pre-sale, which gives you access to a dashboard, which gives us some data on the cost and sales of the CAT tokens:

In the whitepaper, token sale details were marked down to “to be announced.”

Now in the dashboard we see that close to 75 million of the tokens have been sold already, raising around $1.9 million so far in the pre-sale, which is now over. The most recent cost of tokens is 7 cents.

This dashboard situation is a security attack vector. By creating an account there, you put the trust of buying these ICO tokens fully in their hands, and anyone sniffing packets in between, and any security misconfiguration that might lead to convenient problems. We urge the exercise of extreme caution in the establishment of an “ICO funding account” with BitClave or anyone else. A net loss of $0 through purchasing on exchanges later is superior to a net loss of 100% lost thanks to a compromise of the ICO’s accounts system.

The sale will open September 15th. Please manually check the website (https://www.bitclave.com/en/#fundraiser) and social media feeds of the project before sending money anywhere, instead of relying on anything sent to your e-mail inbox.

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ICO Analysis: Sharpe Capital

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Sharpe Capital is primarily an investment company whose core product is creating multiple approaches to understanding the market dynamics of both equities and blockchain assets. The multiple approaches to understanding market dynamics include sentiment analysis, quantitative trading, machine learning, AI and linguistic analysis.

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Analysts at existing hedge funds/investment funds rely on quantitative and fundamental trading models where the value of an asset is tied to its micro and macroeconomic performance. Analysts hope that the trading value of the asset will converge on its “intrinsic value” over time and earn them returns on undervalued assets. Intrinsic value is the value that the analysts calculate based on various economic indicators. Readers familiar with investment analysis will understand these concepts with ease.

However, generating returns based on the calculated search of intrinsic values of undervalued assets is not so easy. Investor sentiment plays a huge role in asset valuation resulting in asset prices consistently diverging from their intrinsic values. For example, Tesla has higher market capitalization than Ford, but does it deserve that high a valuation? In my opinion, no! But investor sentiment is very positive towards Tesla, resulting in its higher market cap.

So, how do you gauge investor sentiment? This is where Sharpe Capital comes in.

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From the perspective of a user who visits Sharpe Capital for the first time, the platform pays Ether for his views on a particular asset. The user is given recent updates about the assets and his opinion is asked. A user’s opinion carries weight based on his previous responses (a reputation system) and the amount of SHP token holding. The payouts on correct opinion will be given accordingly. Opinions of hundreds of thousands of users are evaluated to gauge the overall sentiment about the asset.

Sharpe Capital’s investment analysis methodology is not just sentiment analysis, but also takes into consideration a host of factors like fundamental analysis (macro, micro indicators), linguistic analysis (sentiments, emotions, contextual framing from blogs, twitter feeds, etc.), and machine learning (continuous learning from past experiences).

Sharpe Capital will feed this information into its proprietary investment fund, whose returns will be distributed among all token holders.

The data generated from sentiment analysis and the linguistic analysis will be sold to buyers like investment funds and researchers.

Sharpe Capital is also creating internal auditing tools and enterprise-grade blockchain solutions for hedge funds and corporate clients for transparency and accountability.

Token

The SHP token will serve several functions on Sharpe Capital’s platform. The SHP tokens will give access to the users to earn rewards in ether by voting on bullish versus bearish sentiment of an asset on the Sharpe Capital sentiment platform.

Hedge funds and institutional investors will be able to access information within Sharpe Capital’s Quantitative Trading Model through SHP fees. SHP tokens will help holders participate in governance for Sharpe Capital.

Looking ahead, as regulatory clarity emerges, Sharpe Capital will issue SCDs (Sharpe Crypto Derivatives), a cryptocurrency token that will be tied to the firm’s proprietary investment fund. Holders of SCDs will be entitled to receive dividends from the proprietary fund.

SCDs will have bi-annual Ethereum payouts and will be distributed 1:1 with SHP at a later date.

The ICO began on 13th November and will last until 5th February 2018. The minimum contribution will be $100. The SHP token is valued at 2000 SHPs for 1 ETH. For each 2,000 SHP issued, an additional 2,000 SHP will be held in reserve for future fundraising and an additional 1,000 will be distributed to Sharpe Capital founders and community members for coming platform development for a total distribution of 5,000 SHP for 1 ETH. There is a hard cap of $20 mn for the raise.

40% of the funds raised will be used for the investment fund, while 20% for development and operations.

The bonus structure begins only after $1,500 contributions. You can check out the details here.

Team

According to the company, “The Sharpe Capital team is comprised of a diverse group of experts across the fields of quantitative modeling, financial engineering, linguistic analysis, international law & regulatory requirements.”

There are five members of the core team. Chief Investment Officer James Butler has a Ph.D. in complex system modeling and is responsible for overseeing the development of the Sharpe Capital Investment Platform. This platform was conceived by Butler in collaboration with CEO Lewis M. Barber.

The development of novel approaches to linguistic analysis is supported by leading linguist and anthropologist Mieke Vandenbroucke Ph.D., a Fulbright Scholar and Visiting Researcher at the University of California, Berkeley who is also one of the advisers. There are five other advisers, prominent among them being Dimitri Chupryna, who is the co-founder of TaaS. TaaS will be used for extensive testing of the investment platform.

The team appears solid, with advisers from varied background. One aspect which I personally find somewhat negative is that most of the members, especially the ones developing the investment platform, belong to an academic background rather than one rooted in investment banking. I think this factor is quite relevant for this industry.

Verdict

Let me begin with how well the Whitepaper is written. The team has thought through the project well, with a detailed explanation of the Sharpe Investment Platform. Discussing the technicalities is beyond the scope of this review, but interested readers can go through the document for more information.

That being said, it is quite difficult to judge the quality of an Investment Platform or methodology without historical returns or a product version. The alpha will launch on 12th December with focus on the sentiment analysis part.

Cindicator can be considered the closest competitor, who have been working on the project since November 2014. They have an alpha version and are developing the product from insights coming in from a very active community. Sharpe Capital has some advantages in terms of product quality like the inclusion of linguistic analysis, governance; but then what is stopping a well-funded platform like Cindicator from including these in its product.
Of course, there is space for multiple competing companies, but a segment like sentiment analysis will hold value for only if the platform has thousands of users voting on the platform.

Risks

  • Sentiment analysis will not hold much value if Sharpe Capital is not able to attract enough users. Also, would hedge funds or investment funds find value in sentiments of retail speculators? -2
  • Along with Cindicator, many other companies are working on the same domain. -2
  • The investment analysis methodology although thoroughly developed is purely academic at this moment. -1
  • There are concerns whether the AI based portfolio manager can generate returns, especially in the crypto space where there is so much flux. -1

Growth Potential

  • The product is better than the competitors at this moment. +4
  • Rewards for prediction without the loss of stake is a massive incentive for users to participate on the platform. +3
  • The alpha version will be launching soon on 12th December. The alpha version launch will be a big credibility boost for the project. +2
  • Once the regulatory approvals for SCD tokens are obtained, Sharpe Capital can expand to other dividend based funds. +0.5
  • There will be demand for the enterprise-grade blockchain solutions for hedge funds and corporate clients once regulations demanding more transparency start getting hold. +1

Disposition

We arrive at a score of +4.5 out of 10 for Sharpe Capital. The score can improve +2 points depending on the reception of the alpha version once it launches on the 12th of December.

Investment Details

The ICO began on 13th November. Non-accredited US residents, Chinese and Singapore residents are restricted from the sale. You can participate in the ICO here.

Disclaimer: Writer does not hold an investment position in Sharpe Capital. 

Featured image courtesy of Shutterstock.

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ICO Update: Chimaera

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Online gaming and entertainment is a multi-trillion-dollar industry that is expected to grow manifold as developers push the boundaries with virtual reality, massively multiplayer online (MMO) and real-time strategy. Data crunched by Statista show that the global media and entertainment industry was valued at $1.72 trillion U.S. in 2015 – a figure that is expected to climb to $2.14 trillion by 2020.

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Naturally, any ICO that enters this space is expected to generate lots of attention. Chimaera (CHI) is certainly no different.

The Chimaera blockchain aims to provide a platform for developers to build futuristic games that leverage the latest advances in gaming technology. It does so by democratizing game development and allowing developers to issue their own cryptocurrency that can be traded for the CHI token.

From the perspective of gamers, Chimaera promises decentralized game worlds with 100% uptime and fair play rules.

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One of the main issues Chimaera aims to solve is that of scaling – namely, bringing to life massive game worlds with their comprehensive inventory of virtual assets. The company says it is overcoming these issues with “Trustless Off-chain Scaling for games (Game Channels) and Ephemeral Timestamps.” This essentially means games can be created on the blockchain without the need for a third party.

Token

Chimaera is a massive undertaking, and one that seeks to create novel infrastructure for the gaming community. To realize the vision, the company has issued a two-phase token sale (pre and public). Funds raised through the token sale will be allocated to the following:

  • Development, operational costs and legal: 33%
  • Marketing: 33%
  • Game developer on-boarding: 33%

The CHI utility token fuels the entire ecosystem and serves as the reserve currency of the Chimaera platform, including:

  • Account creation
  • Account transactions
  • Purchasing game
  • Renting game
  • CHI-powered crowdraises
  • Coin transactions

Chimaera will also enable a Token Exchange Period, which will allow users to exchange bitcoin for CHI tokens. Tokens can be redeemed once the genesis block is mined.

Team

The project is backed by one of the most experienced teams in the blockchain gaming industry. This includes CEO Andrew Colosimo, who has over 20 years of experience in IT and computer gaming . He is the founder of the Huntercoin experiment, which achieved the world’s first decentralized MMO game. When it comes to track records in the gaming industry, very few compare with Colosimo.

His team includes a stable of theoretical mathematicians, game developers, software engineers and business leaders. Andrew Gore is also on the team (he’s the guy who co-founded Soccer Manager, which has over 20 million downloads)

Overall, Chimaera’s core team consists of 13 people. It also retains the services of an advisory board made up of four experts in the field of blockchain technology.

Verdict

Chimaera certainly makes a compelling case for blockchain-based gaming. The promise of a fully decentralized, autonomous gaming platform backed by one of the brightest teams in the industry give the project a unique advantage in a nascent market with very few comparables.

Risks

  • Like any project of this stature, implementation and market buy-in is always an issue worth considering. The Chimaera whitepaper does a great job of setting the scene for a decentralized autonomous universe, but building a system that attracts both developers and gamers may prove tricky. In this vein, it’s worth asking if Chimaera is looking to adopt a similar model as Steam, a digital distribution platform for multiplayer gaming. To be fair, the whitepaper does include a detailed discussion about ecosystem, growth and revenue. Still, the author sees this one as a higher risk venture when compared to other ICOs in infrastructure or gaming. -2
  • Although the whitepaper identifies a detailed roadmap, there is no specific end date specified for the token sale. Additionally, there is no mention of how much was raised during the pre-sale or how much has accrued since the official launch. This isn’t necessarily a “con,” but it may echo some of the concerns mentioned in the first bullet point about buy-in. -2

Growth Opportunity

  • When it comes to growth opportunity, very few projects promise near infinite scalability. Chimaera makes it abundantly clear that this is the objective. It also details a precise way for reaching it (i.e., through Game Channels). +2
  • When it comes to project experience, Chimaera’s staff takes the cake. The brains behind this project successfully delivered the Huntercoin experiment, which reached a market cap of $6.3 million earlier this year. Chimaera’s CEO is not only the creator of Huntercoin, but a member of the Namecoin team. +4
  • Although adoption risks are plenty (as with any project of this nature), Chimaera provides gamers themselves with a unique value add. In addition to immersive game worlds, the platform offers a complete gaming universe. This is a strong value proposition for a project that requires buy-in on both sides of the aisle (gamers and developers). +2
  • One of the most unique aspects of Chimaera is the ability for developers to crowdfund their own projects with ICOs. This makes the Chimaera ecosystem truly multi-faceted with the promise of future growth. +2

Disposition

Chimaera is a highly ambitious project that actually promises something new for the gaming industry. If the project’s potential becomes actualized, we may be looking at a major draw for all segments of the gaming community. That being said, implementation could prove daunting given all the market participants that would need to be involved to make Chimaera a success. Against this backdrop, we give the crowdraise a score of 6 out of 10.

Investment Details

  • Type: Crowdsale
  • Symbol: CHI
  • Opening Sale: Oct. 23, 2017
  • Duration: TBD
  • Platform: Custom
  • Tokens Available: 1,100,000,000 CHI (plus unsold presale tokens)
  • Payments Accepted: BTC

Disclaimer: No position in Chimaera or other ICOs at the time of writing.

Featured Image courtesy of Shutterstock. 

 

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ICO Analysis: Pundi X

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Despite being the game-changing tech that it is, recent research shows less than .01% of the world owns cryptocurrency. This number is way lower in countries with mostly bankless populations. Pundi explains, There are 2 reasons crypto has yet to enter the mainstream:

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  1. Too complicated: Researching different exchanges, private keys, passwords, learning what it all means… people don’t have the time or patience to deal with this.
  2. Not relevant. Right now, basically the only thing you can buy with crypto, is more crypto. People need to be able to spend their crypto on real life things such as coffee, and a sandwich.

Pundi X is a Proof of Sale (POS) device that connects to the blockchain using Xplugins. Starting in Indonesia, these devices will be distributed to retail stores, convenient stores, and cafes. The device allows people to use their Pundi card to buy or sell cryptocurrency, as well as the goods/services that store offers. Buy anything in the store, then buy or sell bitcoin/other cryptos almost instantly!

Here’s a demo of how the device works.

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If all works to plan, PundiX will incentivize store owners by giving them a free POS device and allowing them to keep most of the fees. Customers will journey into a store that has PundiX. They will pay for crypto, and in return, get a fancy card with no private keys to worry about.  The card is then used at any location that uses Pundi. Any purchase of goods/services with your Pundi card allows rebates.

  • Black Card ( Ranked 1 – 50); 5% discount for 10 years;
  • Diamond Card ( Ranked 51 – 150); 5% discount for 5 years;
  • Platinum card ( Ranked 151 – 300); 5% discount for 3 years;
  • Gold card ( Ranked > 300; Contributed > 10 ETH); 5% discount for 1 year.

The Token

PXS  is a utility token within the Pundi ecosystem. Its used by developers and sellers to pay gas fees in order to sell their crypto and other goods, in convenience stores, cafes, and shops. Any company or customer that wants to access the ecosystem will have to pay a transaction fee in PXS. These PXS fees are then burned by the smart contract, lowering the total supply.

PXS is a proof of stake (POS) token for the first 3 years of its existence. Each month holders will be awarded PXS airdrops.

Year 1 = 40% extra tokens, year 2 = 20% extra, and year 3 = 10% extra.

The presale is already over. The token price was 650PXS/eth. They raised around $4 million.

The ICO starts Nov 20th, and will start at 575 PXS/eth.

Pundi X is trying to raise over $80 million during the ICO. That is A LOT of money. The reason it’s so much is they are using the money to build the POS devices which they are giving out for free to retail stores, as an incentive, in and around Indonesia. Depending on the amount they raise

Important to note: “If this ICO does not generate 35,000,000 PXS tokens in sales, the company reserves the right to use the remaining tokens for a second ICO. The token price for any second ICO would be greater than in this round, and the current token holders would also be rewarded. The management reserves the right to terminate this ICO and, if this decision is taken, all ETH invested will be returned to the original investors. ”

The Team

The Pundi X team is already 30 people deep, 15 of them (operations) are in Jakarta, Indonesia and the other 15 (R&D) located in Shen Zhen, China. They also already have a very large list of backers/advisors.

It looks like a very talented team, a few members that stood out during my research are:

  • Constantin Papadimitriou (Kiki) is their President Advisor Kiki has 17 years’ experience as Founder and CEO of two of the biggest Fintech companies in Indonesia – Infinetworks and E2Pay.
  • Zac Cheah,  their CEO, is the former W3C Chair of HTML5 Interest Group. He speaks english and can be found doing several different coin ico interviews on Youtube.
  • Huang Pu is the COO, only 25, the wiz kid already has several successful exits under his build, including a 200 person company

PundiX has a massive community. Their social media is extremely active.

Verdict

There are plenty of projects already in the space, somewhat, as they are crypto debit cards. However, most of these projects are running into serious legal problems, as Visa/Mastercard are shying away from letting them run debit cards on their system. Pundix need not worry about this. They have a technology/system in place that will never block users out. One that allows you to buy or sell crypto right there at the store without complications.

In January, the team launched Pundi Pundi (their mother app) already one of the most popular QR payment apps in Indonesia with over 100k downloads, and 20k active users. This app allows people to pay their utility and other bills with little effort, and now with crypto.

Risks

  • Jurisdiction risks. Will this device be legally allowed in retail stores? Pundi responds to this question, “The Indonesian authority has stated that cryptocurrency can be bought and sold as virtual goods. However, it is not allowed to be treated as currency. We will abide by this rule. We are in the final phrase of agreement to use an e-money license with a partnering company. According to Indonesian law, an e-money license is one of the essential licenses in the Fintech business in Indonesia, it allows the user to deposit, pay, withdraw and transfer money online. We are also actively seeking counsel from Indonesia’s Central Bank (BI) and Financial Service Authority (OJK). -1
  • The people don’t adopt it. 70% of the people in Southern Asia only deal with cash, no banks even. It could be rather challenging getting businesses and people to sign on. -1
  • If they dont sell enough tokens in the ICO , it is going to be a problem as the amount they raise funds the amount of devices they are able to make and distribute. And most ICOs the last couple months have underperformed big league -3
  • Security risks- I’m not techy enough to know what they are, but it seems like they are going to have a lot of bugs to work through.

Growth Potential

  • PundiX wants to start out by putting a POS device within 5 minutes of every spot in Jakarta. They estimate this will allow millions of new users the option to buy crypto. After Indonesia, they plan to start expanding to South Korea (could be huge). +4
  • They are currently identifying several channel partners to promote the Pundi X Platform and Pundi X Card. 1.Existing POS Device Manufacturers – both hardware and tablet based (ex. Verifone, mSwipe, Kounta, InHouse, etc.) 2. POS Software Developers 3. Crypto Exchanges (ex. Kraken, Bitrex, etc.) +4. Crypto Cards (ex. TenX) 5. Crypto Banks +3
  • PundiX predicts:
    • “In three years, Pundi X will be present in 100k stores in cities globally, giving over 100 million users access to buy cryptocurrency at their nearest shops, cafes, or convenience stores. If the ICO exceeds expectation, we will deliver faster with extra milestones. Pundi X and the blockchain ecosystem needs your support”   If the upcoming ICO reaches 35,000,000 tokens, our target for an installed base of Pundi X POS devices is 100,000 over 3 years. Since these devices constitute a big part of our cost, the amount raised during the ICO will determine device roll out numbers. For example, if we double the amount raised, our network will reach 220,000 Pundi X POS devices in three years, and so forth.”
  • In countries such as Indonesia, around 70% of the population is unbanked, making it impossible to track their credit ratings and give them bank loans. Pundi X plans to collaborate with local financial institutions to create an effective credit rating system. +2

Disposition

Word on the street is Pundi X is the “Indonesian Omisego”. This is a bold statement that could turn out to be a tremendous marketing campaign.

There’s so much to like about PundiX. It’s a great idea, huge community, solid team, working product(demo), and incentives. What stinks is if you do not live in Indonesia, you cannot use it, and don’t get a fancy card. What you do get for participating in the ICO is proof of stake for the first 3 years, and the hopes of your token value rising as the platform gets more and more popular.  6 out of 10

Investment Details

  • Symbol: PXS
  • Start Date: November 20, 2017
  • End Date: December 20, 2017
  • Platform: ETH
  • Conversion Ratio: 500 PXS/1 ETH +bonuses
  • Max ICO market cap: 280,000 ETH
  • Total Supply: 135 million

To sign up for the whitelist, click here.

Disclaimer: The writer owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock. 

 

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