ICO Analysis: Kinesis Velocity Token

A Big Mac used to cost 27 Venezuelan Bolivars only two years ago, yet today you have to pay more than 25,000 bolivars. The Big Mac Index, a quite reliable way to measure purchasing power, shows that this national currency has lost 99% of its value over the course of last two years. Obviously, this is a quite rare case, but almost every history national currency lost its value at some point and devalued expectedly.

Yet this is not the only problem with fiat currencies. Central banks have the right to print money out of thin air, creating price inflation and devaluation. Since the gold standard, which defines the value of a currency in terms of gold, was abandoned in the 20th century, it is hard to have a precise guess on the real value of any currency. People also lose money even when they deposit their money in banks since almost in every case price inflation is higher than interest.

But this is not to say that it is all good with cryptocurrencies. Although in many cases a maximum number of coins or tokens are determined to exist, so no more coins or tokens can be created once the maximum supply is hit, the extreme volatility of the market proves that cryptocurrencies are not good at storing value. The decrease in Bitcoin’s value from its ATH to today’s value, approximately 70% in USD, proves this fact.

Kinesis aims to provide an alternative to both fiat currncy markets and thee cryptocurrency market by creating an efficient, secure and fair monetary system. Although it will have many components such as Kinesis Currency Exchange, Kinesis Financial Network and Kinesis Commercial Centre, four cryptocurrencies which shall be launched on the platform will be pegged to gold and silver and this will bring considerable price stability.

The first cryptocurrency that will be minted by the Kinesis team, namely Kinesis Velocity Token, is not backed by a physical asset, but it is reasonable to conceive that it is backed by the whole monetary system. As 20% of transaction fees from the whole monetary system will be proportionally distributed to KVT holders when stored in the Kinesis wallet, it provides an opportunity for passive income. As the more progress the platform makes towards its goals, the higher the total transaction fees will be; meaning that KVT holders will get even higher returns on their investments.

The investor should note that even though accepted cryptocurrencies for KVT ICO are Bitcoin and Ethereum, the Kinesis team uses a blockchain forked off Stellar thanks to Stellar’s architecture, higher transaction speeds, and security.

Token

20% of transaction fees within the platform will be proportionally distributed to token holders. As KVT is going to be the first cryptocurrency minted by Kinesis and the platform is intended to act as a whole monetary ecosystem, both an increase in KVT price and in total transaction fees can be expected. Also, the participation in KVT ICO is a pre-requisite for latter Kinesis ICOs.

Kinesis also has a token buy-back program. As the history shows that tokens with buy-back programs tend to attract more investors, this is a great way to incentivize people to participate in the ICO and build hype before buy-back periods. 5% or more of transaction fees will be used to buy tokens presumably periodically and when the token price goes 5% lower than the listing price, the number of buy-back tokens will increase to 20%. This mechanism should mitigate further losses and set the investor’s mind at ease. The ICO investor should also note that the highest bonus offered to any investor is 25%.

The initial total supply of KVT is 300,000 tokens with the following token distribution:

  1. 70% kinetic community
  2. 5% advisors
  3. 9% founders and management
  4. 3% bounty campaign
  5. 10% reserve
  6. 3% ICO marketing

The team is planning to use the token sale proceeds as follows.

  1. 38% strategic investment
  2. 24% trading and operations
  3. 20% technology and development
  4. 10% sales and management
  5. 8% licensing

Team

CEO Thomas Coughlin: Coughlin is the CEO at Allocated Bullion Exchange, an exchange for allocated physical precious metals.

CSO Eric Maine: Maine is the chief strategy officer at Allocated Bullion Exchange.

Soumya Reddy: Reddy has worked as a senior software engineer at SLK for four years, a technology and consulting company.

Partners

The Allocated Bullion Exchange: ABX is a gold exchange which allows investors to buy and sell precious metals since 2013. Many Kinesis team members have worked or have been working for ABX.

Verdict

Below is a breakdown of the risks and growth potential of Kinesis Velocity Token.

Risks

  • A hard-cap of $300,000,000 might be justifiable for a project with ambitious goals such as Kinesis, yet together with sequel ICOs planned for the future, the amount raised will be even higher when all is said and done. This might leave less room for token appreciation. (-1.5)

Growth Potential

  • Due to the mechanism of the buy-back program, token holders’ further possible losses shall be mitigated to some degree. (+1.5)
  • Distributing 20% of transaction fees to KVT tokens creates a truly great incentive to hold tokens. (+3)
  • Kinesis is planned to be a whole monetary ecosystem at the end and the team seems capable to deliver. (+2)
  • Backed by ABX, adoption to a certain degree can be expected. If the distribution of transaction fees goes without any problem, even higher adoption can be expected. (+1.5)

Disposition

Central banks hold the right to print money as much as they like which creates devaluation of national currencies. Even if people deposit their money in order to mitigate losses, usually interest rates offered by banks are lower than price inflation. The Kinesis team thinks that this can be solved by a platform backed by traditional stores of value such as gold and silver. Aiming to create a complete monetary ecosystem, the first cryptocurrency the team introduces is Kinetic Velocity Token. The buy-back program and the distribution of transaction fees create huge incentives to hold KVT tokens even in the presence of great price volatility. Still, the investor should note that the platform is looking to raise $300,000,000 which can deter investors planning to participate in the ICO. Kinesis Velocity Token receives a 6.5/10.

Investment Details

  • Type: ERC20 – Utility
  • Symbol: KVT
  • Platform: Ethereum
  • Crowdsale: September 10th
  • Minimum Investment: $1,000
  • Price: $1,000
  • Hard Cap: $300,000,000
  • Payments Accepted: ETH, BTC, AUD, USD
  • Restricted from Participating: Unspecified

For More Information

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