ICO Analysis: BridgeX Network
As it stands, the fiat currency and cryptocurrency worlds are two very separate realms with interoperability, or the ability of the two realms to interact with each other, severely limited.
For instance, although cryptocurrencies have emerged as an exciting new asset class in recent years, it’s still difficult to use crypto in the fiat currency system as cryptocurrencies are largely unrecognized by the mainstream financial world. Even crypto users who have amassed significant wealth through crypto are unable to access credit using their cryptowealth as collateral for things like loans.
Moreover, crypto to fiat conversions can be difficult, and while crypto could be used to solve the slow, bothersome, and expensive nature of cross-border fiat payments, it isn’t and many such payments are still in done in fiat currencies like the dollar and euro.
To give a concrete example, companies that hold ICOs often have to pay for marketing, PR, legal counsel, development, and so on – this is usually done in all fiat. Fiat is also usually required to pay day to day costs like rent for office space and more. However, getting fiat and making payments is a process that currently requires sending crypto from a wallet to an exchange, selling crypto for fiat on the exchange, and withdrawing to a bank account, all before making payments.
This entire process takes days and fees have to be paid along the way to various intermediaries. Moreover, crypto exchanges each have their own limitations and usually don’t support smaller markets. Thus, companies in these areas can’t always make fiat withdrawals in their home currencies, potentially adding yet another step to the crypto:fiat conversion process.
BridgeX Network aims to “bridge” this divide between fiat and crypto and enable the flawless interoperability between crypto and fiat with decentralized credit, conversion, and payment solutions, such as peer-to-peer (p2p) crypto-based lending and borrowing, easy crypto to fiat currency conversion, and crypto-powered cross-border payments.
The BridgeX Network will be comprised of three parts:
- BridgeX Core
- BridgeX Platform (Distributed Apps/Apps)
- Third Party Integrators (DApps/Apps/Service Providers)
The core technologies that make up BridgeX are Ethereum blockchain-based loan matching and loan tracking services as well as an oracle for collecting off-chain loan contract data (e.g. currency exchange rates) and a cash management module (BRIDGEPay) with off-chain solutions for crypto to fiat conversions and international payments.
- BridgeX’s platform of decentralized applications (DApps) and Apps feature the potential of BridgeX’s core technologies and give other DApp developers a glimpse at the types of DApps that could be built on BridgeX moving forward.
- BRIDGELoan (DApp) – BRIDGELoan is BridgeX’s decentralized p2p collateralized lending marketplace. Loans are crypto to crypto and blockchain-based. Lenders can earn fixed income from their crypto assets at favorable interest rates and diversify their crypto portfolio’s exposure while simultaneously reducing market exposure and the typical crypto portfolio volatility. On the other hand, borrowers can gain access to liquidity in the form of credit by putting up their crypto assets as collateral, all without credit checks but instead a simple and fast borrower:lender matching process.
- BRIDGEPay (App) – BRIDGEPay is a conversions and payments solution made up of BRIDGEConvert (crypto to fiat conversions) and BRIDGESend (international payments). It will also allow loans that originate on the blockchain to be localized in fiat for credit to be accessible and usable in the traditional finance world as well as allow for end-to-end cash management of users’ crypto asset portfolios. Using BRIDGEPay, users can send fiat or crypto to multiple people around the world using their crypto assets, convert crypto to more than 30 major fiat currencies, send fiat money to more than 180 countries using local channels or SWIFT, eliminate various middlemen (thus reducing cost), and save crucial time and money.
Third Party Integrators (DApps/Apps/Service Providers)
While BridgeX offers a few core technologies through its platform, BridgeX wants to create a true network for the new financial economy by allowing players from all kinds of financial backgrounds in both blockchain and traditional finance to create DApps/Apps on BridgeX or leverage BridgeX’s core to offer services on their own existing platforms.
BridgeX’s end goal, then, is to help create a future where everyone has access to credit, crypto assets are accepted as a legitimate form of collateral, and instead of crypto and fiat being at odds with each other, complement each other and work in tandem to provide democratized financial services worldwide.
BridgeX Network will use an ERC20 token known as BXN.
BXN has a number of legitimate uses:
- Access BridgeX Network – BXN is required to access BridgeX’s services, including BridgeX Platform and third party integration for DApps/Apps/Service Providers as well as their users
- Membership system – BridgeX will have a tiered membership system with a limited number of memberships and increasing membership incentives by tier like bigger discounts on network fees
- Discounted network fees – users who pay for BridgeX services using BXN will pay less network fees (non-discounted network fees can be paid in ETH and other accepted cryptocurrencies, as they are automatically converted to BXN). An example would be placing an offer or request for a loan – if a user adds BXN to a collateral portfolio and activates it, the placement fee for a loan offer or request is reduced. Activating enough BXN will lead to a full waiver of the placement fee
- Zero-fee lending – lenders who lend BXN will benefit from zero-fee lending
- Zero-fee borrowing – likewise, borrowers who use BXN benefit from zero-fee borrowing if BXN is used as the loan’s collateral. Using BXN as loan collateral will also increase the allowed loan-to-value (LTV) ratio by 5%, giving borrowers more liquidity for the same amount of collateral
- Lower interest rates – adding BXN to a collateral portfolio and activating it doesn’t just lead to reduced placement fees for loans but lower interest rates, too (for borrowers)
- Loan repayment – Loans can be repaid using BXN (or fiat or crypto collateral, including BXN – any remaining balances are refunded to BridgeX wallets)
- Rewards – as a means of gaining user adoption, BridgeX will reward points to users every time they use a BridgeX Network service, participate in community surveys, and refer new, active users to the network. Reward points can be used to redeem gift shop items like cryptocurrencies and network discount coupons
BXN fees collected by BridgeX are held and burnt periodically.
There will be 1 billion BXN tokens that will be distributed as follows.
- 40% token sale
- 15% liquidity pool
- 10% company reserves
- 15% partnerships/community
- 20% team and advisors
The token sale hard cap is 40,000 ETH and the token sale price is 0.0001 ETH
Token sale proceeds will be allocated in the following manner:
- 30% liquidity pool
- 20% network and platform development
- 10% marketing
- 15% business development
- 15% legal/compliance/tax/admin
- 10% operations
The BridgeX team brings a wealth of relevant experience in financial services and startups to BridgeX.
CEO Jody Ong – Ong brings over 10 years of experience in payments, derivatives, and FX trading. He is the Co-Founder and CEO of an international, licensed remittances and payments provider that counts among its clients DXRacer (gaming chair company that sponsors some of the biggest teams and events in the burgeoning eSports industry) and Singapore Jazz Festival. The payments company is also a portfolio company of 500 Startups’ Southeast Asian fund, 500 Durians.
CTO Joseph Lee – Lee was the trading lead at Kyber Network, a decentralized liquidity network that boasts the likes of Vitalik Buterin as an advisor and has liquidity partners like ICON, Request Network, Wanchain, Trust Wallet, and more. His expertise in building a large liquidity network should be especially useful in building a financial services platform, such as BridgeX Network, that needs substantial liquidity.
COO Hiroyuki Kiga – Kiga was Vice President of Investments for Yello Mobile, a South Korean tech startup holding company with a multi-billion dollar valuation that counts DAYLI Financial Group (Korean exchange Coinone and Korean blockchain project ICON) amongst its subsidiaries. Kiga oversaw investment and acquisition opportunities across Southeast Asia for Yello. He is also Co-Founder and COO of the remittances and payments provider that CEO Ong leads.
Head of Strategy and Partnerships Nicholas Foo – Foo was the Head of Business Development at Grab, Southeast Asia’s version of Uber valued at $6 billion and absolutely dominant in the industry. In November 2017, Grab achieved one billion booked rides and had 95% market share in the third-party taxi hailing market and 72% in the private vehicle hailing market. In fact, Grab acquired Uber’s Southeast Asian business.
Chief Risk Officer Mark Valath – Valath is Vice President of Global Markets at United Overseas Bank or UOB, a Singaporean multinational bank and Southeast Asia’s third largest bank by total assets.
Kai C Chng, CEO and Co-Founder of Digix – Chng worked at HSBC Securities and was Assistant Vice President of forex trading before he co-founded Digix, an Ethereum-based asset tokenization company that offers tokens backed by real assets like gold. He is also Co-Organizer of the Ethereum Singapore Meetup, the largest of its kind in Asia.
Shaun Djie, COO and Co-Founder of Digix – Djie co-founded Digix with Chng and is the Lead Coordinator of the Ethereum Singapore Meetup. He is also a Technical Committee Member for Blockchain and Distributed Ledger Technologies for Incomm Media Development Authority and Enterprise Singapore’s IT Standards Committee.
Chionh Chye Kit – Kit has a lot of experience in compliance, which is of course very useful for a financial services company like BridgeX. Kit is Co-Founder and Managing Director of Cynopsis Solutions, which is part of REGTECH100’s 2018 list of most innovative RegTech (regulatory technology) companies. He also advises Kyber Network, a crypto-based liquidity network that would definitely help a liquidity-demanding project like BridgeX.
Below is a breakdown of the risks and growth potential of BridgeX Network.
- Hype not quite there yet; however, the project is still in its early stages in terms of an ICO and hasn’t even announced a token sale yet. With such an ambitious idea and experienced team and advisors, this will probably change. Plus the team has been making the rounds in the Asian blockchain circuit (-0.5)
- Working product quite impressive – contact the BridgeX Network team via Telegram to schedule a private demo (@NickChiu is their chief marketing officer) (+2)
- An extremely experienced team with with relevant experience and relationships across Southeast Asia. The remittances and payments provider that many of them work at has licenses for things like banking services, cross-border payments, and remittances, which will be a huge help as getting those kinds of licenses can be a struggle. (+2)
- Platform with credit, conversion, and payment solutions that integrates both crypto and fiat doesn’t exist and could be huge, especially in parts of Southeast Asia where many people don’t have access to banking services (this kind of platform isn’t as revolutionary in countries with more developed financial systems unless crypto gains widespread adoption) (+2)
- Advisors are strong as well, with access to a wide network (e.g. Asia’s biggest Ethereum meetup organizers) and technical expertise (e.g. compliance and top RegTech company) (+1)
- More comprehensive than current offerings like SALT and ETHLend, which focus on loans (SALT is only crypto to fiat USD loans and ETHLend is crypto to crypto loans but also exploring crypto to fiat loans) (+0.5)
- Based out of Singapore, a leading crypto hub that’s also the financial hub for Southeast Asia, one of the world’s fastest growing regions (+0.5)
Though BridgeX Network is lacking in hype (for now), being well-positioned in Singapore with a great working product as well as strong team and advisors definitely makes BridgeX Network a project to keep tabs on. BridgeX Network receives a 7.5/10
- Type: ERC20 – Utility
- Symbol: BXN
- Platform: Ethereum
- Crowdsale: TBA
- Minimum Investment: Unspecified
- Price: 1 BXN = .0001 ETH
- Hard Cap: 40,000 ETH
- Payments Accepted: Unspecified, presumably ETH
- Restricted from Participating: Unspecified
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