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ICO Analysis: Gatcoin

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Blockchain has the potential to radically transform the merchant industry. This extends far beyond just accepting bitcoin and altcoins to include a system where merchants can actually issue their own digital tokens for use as discounts and other privileges.

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That’s the general concept behind Gatcoin, a blockchain-based shopping platform that transforms traditional discount coupons, gift cards and other promotions into tradable digital tokens. By joining the Gatcoin system, retailers can issue their own digital tokens to launch seamless discount and loyalty programs to a mass consumer audience. In the case of Gatcoin, this can be done in mere minutes via “targeted airdrop” technology that allows merchants to zero-in precise demographics.

As the company explains in its whitepaper, Gatcoin “seeks to create a controlled environment for enterprises to deploy digital tokens, thereby reducing traditional barriers to blockchain adoption faced by mainstream companies seeking to leverage blockchain innovation.”

The GAT System makes this process remarkably easy by allowing merchants to issue their own branded tokens, which are called Merchant Tokens. From there, these tokens can circulate on private consortia networks and be used to redeem tangible products and services from participating merchants.

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Customers can use GAT-inspired digital tokens to buy products and services, receive discounts or claim rewards. The Gatcoin system also allows tokens from multiple merchants to be stored in one mobile app for instant purchase. Unlike traditional coupons and gift cards, the tokens are tradable on major exchanges and deliver immediate value to customers, regardless of who issues them.

At the time of writing, Gatcoin’s developers have identified five uses for Merchant Tokens. They include:

  • Cash tokens, which are used as pre-paid cash
  • Discount tokens, which are used to subsidize the regular cash price of an item
  • Loyalty tokens, which are used to replace loyalty points
  • Gift tokens, which replace gift vouchers
  • Travel tokens, which are used as portable currency to spend globally

Beyond that, the Gatcoin ecosystem features five key components:

  • GAT Wallet: a mobile token wallet
  • GAT Marketplace: online market of participating retailers
  • GAT Exchange: a cryptocurrency exchange where members can trade Merchant Tokens against GAT Coin
  • GAT Network: private networks where Merchant Tokens are circulated
  • Targeted A-Drop Delivery System: a proprietary system that allows retailers to target specific consumer demographics within minutes

Gatcoin is no small project, and it isn’t just popping up out of nowhere, either. The company has a very strong business case, as it prepares to roll out services across 60,000 retail stores and 21 brands throughout Asia.

GAT Coin

In pursuit of its objectives, Gatcoin has launched an ERC20 token called GAT. It is the main cryptocurrency transacted on the GAT Exchange, which enables customers to trade and acquire Merchant Tokens. Consumers can use their GAT Coins to purchase Merchant Tokens or vice versa. The main differences between GAT coins and Merchant Tokens are outlined in the chart below.

GAT Coins Merchant Tokens
 Available during token raise  Not available during token raise
 Limited supply  Unlimited supply
 Will circulate on the Ethereum public   network  Will circulate on private GAT networks
 Freely transferable  Not available on Ethereum public   network
 Storable in all major wallets  Storable only in GAT wallet
May be exchanged for Merchant Token May be exchanged for GAT Coins

Gatcoin’s public pre-sale will launch Oct. 28 and last for one month. A total of 15 million GAT Coins will be available during the pre-sale at a rate of $0.20 US per unit. Investors who participate in it are eligible for a 20% bonus.

A total of 115 million tokens will be available during the public sale beginning Dec. 15 and lasting through Jan. 15, 2018.

Investors participating in the crowdsale receive their GAT Coins immediately upon purchase. GAT tokens are transferable upon conclusion of the public token sale in January.

The minimum funding goal for the project is $20 million USD, with a hard cap of $35,870,370.

The Team

Let’s just get this out of the way: Gatcoin’s team is nothing short of remarkable. We can literally spend pages talking about their skills and professional experience, but let’s just say the token project has managed to attract blockchain experts, Swiss bankers, professors, tech geniuses and cryptocurrency investors. A total of 16 people are part of the core team, according to the main website.

Simon Cheong is the main architect behind Gatcoin. As a blockchain entrepreneur and former World Bank lawyer, Cheong has an outstanding track record for a project of this nature. Other notable team members include Emeritus Professor Wei-Tek Tsai, marketing heavyweight Anthony Huang and tech entrepreneur James Kong.

Samson Lee, who is the co-founder of the Ethereum Organization for South China and South Asia, is also on the team. It should be noted that Ethereum founder Vitalik Buterin has endorsed the regional organization. Blockchain investor Ross Stokes and Swiss banker Michael Blake are also part of the project.

The technical team includes programmers, retail web developers, token program designers and graphic illustrators.

Verdict

When it comes to the world of retail, Gatcoin is a potential game changer, and falls under a narrow splice of ICOs that can bring real disruption to the market. The author would place it in a similar category as Spectre and Polkadot, albeit for entirely different reasons.

Risks

  • The company cites immaturity of the Ethereum network as a primary risk. This is not entirely unfounded, given the long-standing challenges facing Ethereum’s mainstream development. The Ethereum network has already been prone to significant processing delays due to extremely high volumes. It seems like Gatcoin’s success would exacerbate processing delays on the network, especially if mass adoption is achieved. To date, it is unclear how or if the Ethereum community can resolve these issues. -3
  • Although the author is a believer in the GAT protocol, and argues for its adoption below, a project of this nature relies heavily on mass adoption. While the conditions are certainly ripe for this to occur, retailer adoption rates are a huge unknown at the moment. -3
  • Gatcoin isn’t the only startup using blockchain technology to disrupt the consumer industry. The competition for merchant processing will only grow as the blockchain revolution intensified. -3

Growth Potential

  • When it comes to star studded lineups, only a few ICOs can compete with Gatcoin. It’s not just who they have on board, but the diverse cross-section of talent that is represented. Blockchain entrepreneurs, cryptocurrency investors, Ethereum champions and investment bankers make up a highly competitive team of people. +5 
  • If you haven’t noticed, traditional retail is struggling to stay alive. That means discounts, loyalty programs and other incentives are becoming more vital than ever to attract and retain customers. Gatcoin is in a position of strength to capitalize on this demand. If Groupon is a crude proxy for what Gatcoin can do, then the future looks very bright. +4
  • A-Drop is essentially real-time target marketing that allows retailers to narrow in on their ideal demographic within minutes. This technology, which is currently patent-pending, could be an extremely powerful draw for retailers. +3
  • From the perspective of consumer adoption, Gatcoin has a unique opportunity to consolidate loyalty programs all in one place. Token liquidity also gives consumers full utilization of shopping incentives. In other words, the author sees plenty of reasons for consumer adoption. +4

Disposition

Having considered all the above, we settle on a score of 7 out of 10 for Gatcoin. Since many ICO concepts are unproven, arriving at a score higher than this is often difficult to justify.

Make no mistake – Gatcoin is a potential game changer. Its success will depend largely on mass merchant adoption. The incentive is certainly there. Now it’s time to get the word out.

Investment Details

  • Type: Crowdsale
  • Symbol: GAT
  • Public Pre-Sale: Oct. 28 – Nov. 28, 2017
  • Opening Sale: Dec. 15, 2017 – Jan. 15, 2018
  • Platform: Ethereum (ETH)
  • Total Supply: 1 billion GAT
  • Future Distributions: 60% over three-year period (2018-2021)
  • Payments Accepted: Ethereum (ETH)

Featured image courtesy of Shutterstock.

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1 Comment

1 Comment

  1. Akinz11

    November 28, 2017 at 5:15 am

    Hi Sam.

    It seems GAT has not been able to get any funds in the private sale. How does this effect the rating of the coin/ICO?

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ICO

ICO Analysis: Gimmer Token

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The impeccable rise of algorithmic trading has ushered in a new wave of do-it-yourself (DIY) algorithmic trading bots. With the success of these DIY bots in traditional financial markets, it was only a matter of time until they entered the cryptocurrency market.

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For algorithmic trading, volatility creates opportunity sets. And with cryptocurrencies still trading in an inefficient market, volatility runs rampant. This level of volatility creates an ideal environment for even the most rudimentary algorithmic trading strategies. However, there is a lack of DIY automated trading bots that are available for use by amatuer cryptocurrency traders. With this in mind, Gimmer is looking to take advantage of this need.

According to the company’s website, “Gimmer offers easy-to-use advanced algorithmic trading bots that require no programming skills, no previous trading experience and no in-depth knowledge of cryptocurrencies.”  

Essentially, Gimmer is hoping to position itself as the leading DIY algorithmic trading bots for individual cryptocurrency traders. While the company may never be the “Quantopian” of the cryptocurrency space, Gimmer does provide a novel solution for amateur traders.  

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Token

The Gimmer token (GMR) will be implemented using the Ethereum ERC20. While GMR tokens will be visible in participants’ ERC20 wallet, the tokens will not be tradable until the close of the public sale on January 31, 2018. GMR tokens will issued starting from January 3, 2018. GMR holders generate value from the token as a form of payment for the rental cost of Gimmer’s trading bots. For users, the rental cost scales proportionately to the level of sophistication desired – more sophistication equals higher return (at least in theory).

According to the whitepaper, 45% of the funds raised will go towards development and operations, 35% towards marketing and acquisition, 15% towards the founders and team, with the remainder of the pot (5%) going to legal and compliance.

Gimmer Tokens are valued at 1 Ether (ETH) per 1,000 GMR (plus applicable bonuses). The total amount of tokens to be sold is capped at 100,000,000 GMR. However, an additional 6,000,000 GMR will be created for advisors, reserves, and the team, with another 4,000,000 GMR created for bounties.

The company has not yet stated its intention to list the GMR tokens on any major crypto exchanges.

Team

Gimmer’s core team consists of two senior developers, a global macro hedge fund manager, and a creative design veteran. As compared with the majority of ICOs, Gimmer’s team is in-line with the relative standard – the quality of team meets basic expectations.  

The company’s CEO, Philipe Comini, is a senior-level UX/UI designer who is also balancing two other jobs (according to LinkedIn) – typically, not a good sign. The company’s CTO, Persio Flexa, is also a senior developer who recently launched 2 other start-ups – again, not a good sign. The company’s COO, Paul Lindsell, is a creative design veteran with over 12 years experience that is seemingly committed to his role – not balancing multiple jobs. The company’s CIO, Masaichi Hasegawa, is currently a global macro hedge fund manager and an executive of a shoe manufacturing company – the third C-suite executive of Gimmer to balance two other jobs.

The rest of Gimmer’s team consists of a marketing director, a user experience director, two developers, a customer researcher, a commercial director, and a journalist.

Verdict

Gimmer presents a highly speculative buying opportunity for investors interested in short-term capital appreciation.

Creating profitable algorithmic trading strategies is incredibly difficult. Hedge funds typically employ a large staff of mathematicians, experienced machine learning engineers, data scientists, and the like – Wall Street refers to them as “quants.” Quants typically hold a PhD in finance or quantitative mathematics and have years of hands-on experience with both statistical analysis and engineering (Python and C++). Does Gimmer employ any quants? No, not even by the slightest measure.

Overall, Gimmer’s DIY algorithmic trading bots are likely just a novel tool-kit for amatuer cryptocurrency traders, nothing more, nothing less.

Risks

Gimmer provides no data on slippage modeling, meaning users have no idea of all the transaction costs that are associated with a higher frequency of trading (including: fees, commission, and slippage). These costs can be significant and add up quickly. -1

Gimmer’s core team does not seem to be dedicated (balancing multiple jobs) or qualified in any sense. With Gimmer’s team lacking any real trading platform experience, unforeseen issues with their algorithms may lead to sizable losses for users. -1.5

Gimmer provides no data on latency, meaning users do not know if the company’s algorithms are deployed to proximity-based execution servers in attempt to achieve low-latency performance no matter where the user is located. For all trading strategies, latency must be measured and managed in order to maximize the probability of success. -1

Growth Opportunity

Provided that Gimmer’s trading bots run successfully without any technical glitches, users could benefit from enhanced risk management protocols, thereby insuring their principal investment through more downside protection. +2

Copy trading techniques could benefit novice traders, as they can publicly see high level information such as start date, running period, currency pairs and percent gained. Based on the public information, users can copy seemingly successful trading strategies and rent the same bots. +3

Automated trading strategies will allow a larger pool of traders to invest in cryptocurrencies. Since the market is still subject to large, volatile price swings, more passive traders could use Gimmer’s platform to execute automated trades (based on pre-set parameters) without having to monitor the market on a day-to-day basis. +2.5

Disposition

While algorithmic trading in the cryptocurrency space is a smart strategy, Gimmer lacks the sophistication of even the most basic trading platforms. The biggest concern beyond Gimmer’s lack of sophistication, is the pedigree of the core team. With no quants on staff and a couple UI/UX designers creating the algorithms, technical issues are likely to occur. And with that in mind, faulty algorithms or platform glitches could easily lead to the loss of principal investment for users.

For amateur traders interested in novel tool to play around with, Gimmer is a great choice. For veteran traders with solid programming and statistical skills, move on to a better platform.

Against this backdrop, we believe that a score of 4.0 out of 10 is warranted.

Investment Details

  • Type: Crowdsale
  • Symbol: GMR
  • Pre-ICO Sale: November 24, 2017
  • Public Sale: January 3, 2018
  • Payments Accepted: ETH

Disclaimer: no position in Gimmer at the time of writing.

Featured image courtesy of Shutterstock.

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ICO

ICO Analysis: Lendoit

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Lendoit is a next-generation peer to peer decentralized lending platform based on Ethereum, which connects lenders and borrowers all over the world using the advantages of smart contracts.

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The Lendoit platform provides professional scoring and verification, APIS for each country, a loan marketplace where lenders set rates on loan applications, a default market where failed loans can be traded, syndicated loans, and the ability to sell a loan to another lender if needed. Lendoit will be the only lending platform on the market that does not take collaterals. The company believes that, “in a world of crypto micro-loans, managing collaterals is not sensible.” In their view, this is “like lending USD by using EUR as collateral.”

Because there are no collaterals, the Lendoit platform combines four methods to mitigate the chances of lenders losing money: Smart Compensation Fund, Syndicated Loans, 3rd party scoring/verification from local companies, and a collectors market where debts can be sold.

The following is a simplified guide to Lendoit’s loan process.

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  1. The borrower applies for a loan by filling out an application. This takes about three minutes.
  2. The borrower uploads any relevant verification (i.e. government-issued photo ID) according to their particular country’s regulations.
  3. Lendoit sends the loan app and verified information to verified scoring providers to receive a score for the current loan.
  4. Lendoit will publish each smart loan contract in the blockchain and marketplace.
  5. Lenders Tender is a process of raising loans for funds requested by the borrower.
  6. The borrower can now withdraw the funds using his or her wallet.
  7. When the date to pay back the loan arrives, the borrower receives a notification.
  8. The borrower now repays the funds with interest to the smart contract.
  9. The lender withdraws his money in the same currency he loaned it.
  10. The lender receives interest in the form of LOAN tokens, the amount based on an automatic conversion algorithm put in place by the Smart Conversion Contract.
  11. The Smart Compensation Fund Contract helps lenders recover a small portion of their money, if the borrower fails to pay. The amount is not confirmed, but it seems like it will be around 20-30%.
  12. If the borrower fails to pay the interest and the loan becomes defaulted, the smart loan contract is offered to a collectors tender. The collector who wins the tender buys the debt, which minimizes the loss of funds for the lenders.

Lendoit has an alpha version of its platform available here. It is not very impressive yet. The real technology (smart contracts) has yet to be created.

They plan to release the beta in Q1 of 2018, and the fully operational version Q3 of 2018.

The Token

  • Symbol: LOAN
  • Platform: Ethereum
  • Presale: Dec. 13 – December 27, 2017 (125 million for sale. 1 ETH = 13,000 LOAN). Must register for whitelist in order to contribute.
  • Token sale: Jan. 18 – Feb. 18, 2018 (475 million for sale. sale starts at 1 ETH = 12,000 LOAN)
  • Total Supply: 1 billion
  • Hard Cap: 50,000 Eth (currently $22 million USD)

The LOAN token plays several roles. Here are a few of the most important:

  1. Lenders can use any ERC20 currency to loan, but must hold 10% of whatever amount they loan in LOAN tokens. For example, a lender wants to loan someone $1,000 ETH must hold $100 worth of LOAN in his account.
  2. Borrower must use LOAN to publish the Smart Loan Contract.
  3. All the fees charged on the platform are paid in LOANs.
  4. All the interest payments will be paid to the lenders in LOANs. This will take place automatically via the Smart Conversion Contract.

The Team

The company is located in Israel but incorporated in Gibraltar. The company maintains a large global team that extends far beyond its in-house operation. However, after researching the four co-founders of the company, nothing particularly striking stands out. One would have expected a more impressive track record for those launching a platform of this magnitude.

Seven advisers are signed on to the project, including Richard Titus and Michael Terpin. They also have eight developers, which is fantastic, as it shows they really are trying.

The team picture (above) leaves a lot to be desired, as it is not very professional.

The Verdict

This project has great long-term potential. Its biggest challenge is going to be whether or not it can successfully build the various forms of smart contracts it proposes to launch. There are no known smart contracts in existence that can do what Lendoit promises its contracts will be able to do.

Risks

  • The concept of not needing collateral to receive loans could be a disaster. Why would lenders want to use this platform when the possibility of getting stiffed is so high? They can just use one of Lendoit’s competitors to guarantee their returns. -2
  • The project faces legal hurdles galore. Sure, the plan is to be decentralized, which could reduce certain regulations, but the company is going to be verifying borrowers’ identities in great detail. I could see governments clamping down on projects such as this one if enough lenders start getting ripped off. -2
  • The technology required to run this platform does not exist yet. The demo/alpha provided as an example of is extremely basic. It’s a strong possibility the team fails, and this never gets off the ground.  -2

Growth Potential

  • The company has several partners, including Bloom, Hive, RSK, and Wings. I tried to dig deeper into these partnerships but didn’t find anything substantial. These seem to be decent projects, and LOAN can use each to grow.+2
  • Some of these other new lending ICOs have done pretty well so far on the markets. SALT token, for example, is extremely hyped. One of the main differences between SALT and LOAN is that SALT requires borrowers to put up collateral, while LOAN does not. One would think this would bring more borrowers to the platform +2
  • If they do what they claim to be able to do – build these genius smart contracts – they can change the lending game permanently. In this way, the sky is the limit. +4
  • The team has put a great deal of emphasis on development, as evidenced by the number of developers they have on board. +2

Disposition

As previously stated, the most important aspect of this project is the technology. Can they build these contracts? According to the roadmap, we won’t see the beta version for two or three months, and we won’t be able to judge if the contracts are fully functional for at least six months. This has long-term potential, but a rocky short-term.  Against this backdrop, we assign a score of 4 out of 10.

Token Details

Learn more/sign up for whitelist here.

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ICO

ICO Analysis: CanYa

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CanYa is offering a platform for the exchange of peer-to-peer services.

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Users can load their CanYa wallets with the ERC20 CanYaCoin token, in addition to several support fiat currencies.

Users will be able to instantly pay for services on a global and local level. The platform supports peer-to-peer services and relies on users to self-curate and verify new types of services and providers.

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Providers can earn CanYaCoins for their services, and can spend these coins within the app, or convert and send them to their Bitcoin or Ethereum wallet using CanYa’s network of zero-fee exchanges. Once users are verified, they can withdraw immediately to a fiat bank account without having to pay fees or transaction limits.

The CanYa platform also claims to help the best providers rise to the top and get more exposure and work.

**It’s important to note that the CanYa ICO cannot accept participation from US citizens unless you qualify as “accredited investors.”

The Team

CanYa was founded in 2015 with the goal of created a true peer-to-peer platform with no intermediary, based on meritocracy, and a seamless interface connecting the digital world with the real one.

The whitepaper claims the project moved from concept in 2015 to development in 2016 and then a successful soft-launch in 2017 in a small Australian market.

There are currently 3,400 provider listings with roughly 7,600 user engaging on the platform, with monthly growth in double digits.

Based in Australia, the founding team includes Rowan Willson, Christopher McLoughlin, JP Thor, Jet Yap, and a handful of other promising team members and advisors. Their work thus far is promising, although I do naturally have my hesitations about tackling a project of this scope and creating significant traction out of Australia.

Tokens and Distribution

CanYa is aiming to raise 29,333 ETH by offering 34,000,000 CanYaCoins for public sale.

These funds are being used to integrate the cryptocurrency payment layer, provide liquidity for the hedged escrow contract, expand features and “undertake an aggressive global launch with marketing, translations and infrastructure.”

There will be around 100,000,000 tokens in circulation, with a hard cap of 60,000,000 CanYaCoins for sale. A total of 26,000,000 CanYaCoins are going to be sold privately to “strategic investors who bring long-term value to the project”. These private investors incur vesting schedules from three months to 12 months. A total of 34,000,000 CanYaCoins will be sold during the public sale that started in November.

The token offering will only accept ECH.

Risks

  • Onboarding new crypto-enabled merchants poses a substantial bottleneck. Freelancers and workers-for-hire flock to where the money is, and if CanYa has any shortage of jobs available, they will stick to traditional methods. Onboarding new crypto-enabled merchants will require substantial marketing work and is hindered by the learning curve that comes with acquiring and spending cryptocurrencies. -2
  • Competitors in the digital service industry could pose a substantial threat to user acquisition. While CanYa poses a huge benefit of much lower transaction fees, platforms such as UpWork and Fiverr have already dumped a ton of resources and money to grow, and it might be difficult to catch up without an extensive marketing plan. -3

Growth Potential

  • Peer-to-peer networks at scale have always been burdened with some sort of third-party making a commission off the transaction, and this is a very applicable use of smart contracts to replace those intermediaries. The intermediary commissions (from the platforms to the payment services) add up to the tune of billions globally. +3
  • CanYa resonates with its ideal user base. This project also happens to target the same userbase that is perhaps the most crypto-savvy segment of the world: Internet entrepreneurs. This seems like an easy target to launch an active user-base. +2
  • The value add the CanYa platform offers over other services such as UpWork is pretty attractive. UpWork, for example, charges freelancers 20% of their total contract price up to $500 and then 10% up to $10,000. A freelancer seeing the option to work on a similar platform and essentially make 20% more money is an easy sell. +3
  • The platform is incredibly detailed and well-thought out in the whitepaper. This is one of the few ICO products I can actually see myself using on a daily basis, provided the CanYa team is able to attract a significant amount of users on both ends. +2
  • The CanYa team shows a willingness to stick with the project long-term, and even champions the cause with a “CanYa HODL club” by rewarding holders of more than 5000 CAN tokens at the ICO with perks of being in the HODL club. +2

Disposition

As someone that has done freelance work and hired multiple freelancers for various projects, I can appreciate a project like CanYa. I also think it’s cool how the CanYa platform also works for real-life services.

We arrive at a score of 7 out of 10 for the CanYa ICO.

Overall, the whitepaper and marketing materials for CanYa are very thorough and easy to go through, showing a much appreciated effort by the CanYa team to make their ICO easier to understand and palatable for average investors.

Investment Details

You can find more details about the CanYa ICO here.

**It’s important to note that the CanYa ICO cannot accept participation from US citizens unless you qualify as “accredited investors.”

You can find the ICO whitepaper here. The sale opened Nov. 26, 2017 and will run through Dec. 26. 

Featured image courtesy of Shutterstock. 

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