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ICO Analysis: Propy

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Doesn’t matter how innovative things get, the blockchain can’t move the levers of the government. The blockchain can’t move deeds and property titles, it just can’t. There’s no solving this. In anything related to real estate, you’re going to have multiple levels of government interference. In a sense, in some respects, government is really a primitive form of blockchain which acts as a ledger for property titles, fiat currency, social norms in the form of laws, and more. We have to establish this before we talk about Propy, because otherwise people may get distracted and forget this basic fact or they may think it’s a fatal flaw we’ve missed.

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As the blogger Luke Stokes reminds us, people would get off track and forget to care about whether this thing is legally possible or not.

Right now, I think the answer is obvious. Very few people care. Many don’t even read a white paper before jumping into an ICO. It’s all about quick gains. Who can blame them. Rationality can’t stand up against reality when the reality of returns is real in this speculative, quickly growing ecosystem.

We basically rated Eros.Vision as a scam on those grounds, but we’re not predicting anything close to that level of negativity here. It’s just that when you talk about property swaps, you’re not talking about something that I can actually give to you, even though it’s mine. I can grant you access and everything, vacate the place, let you occupy it, et cetera, but it’s not really your property until the government has registered it as yours, and at that point, it becomes your liability. So when we’re talking about Propy, which proports to make property swapping all the easier through the miracle of the blockchain, we’ve got to be cognizant of this fact.

Yet, we must start out on a positive note: the disruption of the property market is going to be a lucrative endeavor, anyway you look at it. We don’t mean, through this statement, to imply, necessarily at least, that Propy will be doing that. But we do mean to imply that property-related ICOs are the kind to be on the lookout for, and as such, we’re covering a few this week.

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Propy begins their whitepaper with some fairly obvious statements that justify our previous paragraph but do nothing to establish what Propy is. A whitepaper is meant to describe something that will be created or is being noticed as a trend, among other purposes, but it’s not meant to be a literary elucidation of historical fact like this:

Today, the global real estate market is worth $217 trillion and makes up more than half the value of all mainstream assets worldwide3. One great differentiator between real estate and other major asset classes is liquidity. Compared to exchange-traded securities such as equities and government bonds, real estate markets are not as organized or efficient as other markets, with incredibly slow transaction times and less efficient price discovery mechanisms. As a result, substantial capital is trapped in less liquid investments, often concentrated in certain geographic areas devoid of domestic investment opportunities. While many investors with excess liquidity would welcome the opportunity to invest in foreign real estate assets, there are currently substantial impediments to such investment activity.

We infer from the above that what we’re getting into is in fact international real estate, in some cases at least. Well, again, this can be problematic on many levels, and a monumental task in legal terms. We have to have a very healthy skepticism of the project as a result.

We can hope that investors will keep the thing afloat until it succeeds – because we believe that such a thing can succeed – but we don’t have a lot of faith in our fellow funders. Everyone’s looking to cash out as soon as it’s profitable to do so, after all, which is why we seek ideas that have incredibly high ceilings on their profit, so everyone can make something. And while we may have that in Propy, in a sense, what we don’t have, on the face, is something that we can envision actually happening. But let’s look a bit deeper into how it works, then into the token, and deliver a verdict on Propy.

Propy aims to solve the problems facing international real estate transactions by creating a novel unified property store and asset transfer platform for the global real estate industry. Initially the Propy Registry will mirror official land registry records in which transfers of real estate are recorded. Ultimately, however, Propy’s vision is that jurisdictions will adopt the Propy Registry as their official ledger of record such that the transfer of a property on the Propy Registry constitutes the legal transfer of the property and the legal registration of that transfer. By leveraging Propy Registry and Propy’s smart contracts platform, unnecessary delays and impediments inherent to legacy property rights registrations systems could be eliminated. The Propy platform seeks to enhance the security of transactions while reducing inefficiencies through its innovative use of mobile, cloud and blockchain technologies linking buyers, sellers, investors and registries around the world.

Let’s repeat a piece of the above before moving forward: Propy’s vision is that jurisdictions will adopt the Propy Registry as their official ledger of record such that the transfer of a property on the Propy Registry constitutes the legal transfer of the property and the legal registration of that transfer.

In short, Propy wants to become the de facto deliverer of governments from the woes of legacy controls. Controls that they establish and have full dominion over. Is there some inherent benefit to governments from increased transparency? Of course there isn’t. The opaque nature of governmental operations is what allows them to extract as much from the populace in the form of taxation as they wish, and to waste the funds as freely as they wish. While it would benefit said populace to bring transparency to government land registries, it would benefit the governments very little, for the most part, although there is an efficiency argument which is astutely made in the selfsame whitepaper:

Propy’s engineering team has designed a real estate transaction tool powered by smart contracts, combining solutions from the legal, blockchain and payments industries. Using blockchain technology, Propy has prototyped some of the core technology that will become the Propy Registry as a DApp that allows each party to a real estate transaction — including the broker, buyer, seller and title agent/notary—to sign off on a transaction for properties located in California, which is Propy’s intended first market.

There’s more to be said on the transparency in government angle, which is that there are political gains to be made from promoting transparency. That they’re targeting California seems legitimate, but again, we have huge doubts about this whole thing.

It should be noted that Propy already has a working application.

Now let’s examine what the token does and deliver a verdict.

Propy Token (PRO)

The PRO token has an interesting value proposition that means this token will have real value if the platform actually gains traction. This is to say, if a jurisdiction actually were to adopt the Propy platform (imagine that!), then this token will have significant value because it will be required to actually sell property – it will therefore become built into real estate costs, and will be extremely affordable since through the real estate platforms that can be built on top of Propy, we will see a reduction in the need for middlemen such as real estate agents, and with their fees disappearing plenty of market room will be made for the cost of the PRO token. But all of this, again, depends on a jurisdiction somewhere actually adoption this platform and not one brought in through some manner of cronyism.

The PRO tokens are designed to be used to unlock a smart contract for title transfer in the Propy Registry. PRO tokens are built on the ERC-20 token standard, which allows for simple integration into users‘ wallets. The essential and obligatory steps for a real estate acquisition on Propy Registry includes the execution of the Deed Contract and Title Contract, which are necessary for the transfer of property title and the recording of the change of ownership. The Propy Registry, will require the use of PROs to pay the associated “Registry Fees” to record these modification on blockchain.

The Verdict

We feel that any potential adoption of the Propy platform will be mired down in numerous legal hurdles, including security audits. Additionally, the cronyist nature of governments means that competing platforms will have a leg-up depending on the jurisdiction. This is to say that even if Propy takes off, it will never be the only such platform for property transfer. That the whole thing relies so heavily on government movement really makes the thing unattractive to us.

Risk

  • Relying on governments and regulators to eventually choose Propy as the default platform. -3
  • Cronyism creates impossible competition in various places, displacing Propy significantly enough to lower the token’s value. -0.5
  • Unlikely to have real-world value in the short-term. -0.25
  • HUGE AMOUNT OF TOKENS NOT ON MARKET IMMEDIATELY. -0.25

Growth Potential

  • Could disrupt real estate market, and free up lots of cash currently going to broker fees for a marketplace of such tokens. However, very unlikely to be the first major player or the only player, ever. +5
  • Identifies a great opportunity on a global level in the ability to swap real estate and other assets over the blockchain. Successful execution will be incredibly lucrative. +2

Disposition

We come upon a 4 (7-4) as far as numerical dispositions go with Propy. It’s got a long-term value proposition that depends on a lot of factors which are hard to predict, so we’ll say you’ve got a 40% chance of really making a huge buck on it. Hype around it has been positive and copious, however, so getting in at ICO prices might yield short-term profits.

Investment Details

100 million tokens are currently being generated, with 65% being held away from sale. The rather confusing and slanted distribution looks like this:

It appears that funds will be raised until September 15th, and the amount raised will be dispersed among the 35 million tokens in terms of how much they are valued.

Visit https://tokensale.propy.com before then if you are interested in participating in the PRO ICO.

Important: Never invest money you can't afford to lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here.



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1 Comment

1 Comment

  1. jusdavi

    August 24, 2017 at 1:18 am

    Check out CPROP https://cprop.io

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Analysis

Bitcoin’s Record-Breaking Rally Continues as Prices Cross $8,100

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Bitcoin surged to new highs on Sunday, as the world’s largest crypto by market cap continued to generate bids following the cancellation of Segwit2x.

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BTC/USD Price Levels

The value of a single bitcoin reached a daily high of $8,110.59, its best level on record. At press time, BTC/USD was valued at around $8,002 for a gain of 4%.

With the gain, bitcoin’s market cap now exceeds $133 billion. That’s roughly $100 billion greater than Ethereum, the market’s second most valuable cryptocurrency.

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Bitcoin has added more than $1,100 over the past five sessions. It was down around $5,600 just one week ago.

Bitcoin Cash (BCH), a digital currency alternative that broke away from the original blockchain Aug. 1, was down 5.1% at $1,185. BTC and BCH locked horns earlier this month after the Segwit2x hard fork was abandoned.

$10,000 and Beyond?

Institutional clearing platform LedgerX has initiated its first long-term bitcoin futures option, which is set to expire Dec. 28, 2018. In setting up the option, LedgerX is assuming a price of $10,000 at the time of expiration. That’s a 25% premium on current levels.

Investors who buy the option are essentially saying they believe prices will exceed $10,000 by the time of expiration.

Bitcoin is being helped by growing institutional demand for the digital currency, as hedge funds, day traders and other mainstream investment outfits look to access this burgeoning asset class. CBOE and CME Group have each announced plans to integrate bitcoin into more conventional investment vehicles in the coming months.

The rush of institutional money into bitcoin is a sure sign that the digital asset class is becoming too big to ignore. The value of all cryptocurrencies in circulation has already exceeded $230 billion, with more than a dozen coins valued at $1 billion or more. Nine others have a market cap of $500 million or greater.

Coinbase Responds

The rise of institutional capital has also compelled Coinbase to introduce a custodial service targeted at account holders with more than $10 million in assets. This service targets hedge funds and other institutions that have remained largely on the sidelines of the crypto revolution.

In a recent blog post, Coinbase CEO Brian Armstrong announced that the new service will launch sometime next year.

“When we speak with these institutions, they tell us that the number one thing preventing them from getting started is the existence of a digital asset custodian that they can trust to store client funds securely,” Armstrong wrote.

In addition to maintaining the minimum $10 million asset requirement, institutions must pay a $100,000 setup fee to gain access tot he Custodial program. In response, institutional investors will receive assurance that their assets are secure.

The Coinbase Custody website lists broad support for bitcoin, Ethereum (ETH) and Litecoin (LTC), as well as ERC20 tokens. The ERC20 protocol has emerged as the favorite for startups launching initial coin offerings (ICOs), a controversial crowdfunding model that has already overtaken early stage venture capital.

Disclaimer: The author 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. 

Important: Never invest money you can't afford to lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here.



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Cryptocurrencies

Is Ethereum Ready to Play Catch Up With Bitcoin?

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In mid-June of this year, the difference between the market capitalization of bitcoin and Ethereum had narrowed down to less than $8 billion. This had many market participants excited. They expected Ethereum to dethrone bitcoin as the leader, a move popularly termed as flippening.

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Key observations

  1. Ethereum has hugely underperformed bitcoin
  2. The chart pattern suggests that Ethereum is likely to play catch up in the next few months
  3. Stay on the long side of Ethereum to benefit from the bullish setup

However, fast forward five months and the difference in the market capitalization of the top two cryptocurrencies has increased to about $96 billion. This shows that while bitcoin has raced ahead in the past few months, Ethereum has hugely lagged behind.

However, is the underperformance about to end?

The chart pattern shows that Ethereum is likely to embark on a rally of its own that can carry it to $645 to $670 levels in the next few months. Let’s see how we arrived at these levels.

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Ethereum opened trading at $8.16 on January 1, 2017. It started its rally in March and by June 12, it reached a high of $420, an astronomical rally of about 5047%. Thereafter, it entered a period of consolidation, digesting the gains.

On the charts, Ethereum has formed a large symmetrical triangle, which usually acts as a continuation pattern. The breakout is generally in the direction of the long-term trend, or the trend that was prevailing before the pattern formed. In this case, the sharp move from January to June confirms that the cryptocurrency was in an uptrend before forming the triangle.

However, this is not a fool proof trade because sometimes the symmetrical triangle acts as a reversal pattern. Therefore, the best way to play this trade is to wait for a breakout of the triangle before initiating any trade.

Where can we take an entry?

Currently, the resistance line of the triangle is at about $378 levels, a level close to today’s intraday highs. The bears are likely to strongly defend this level. However, if the bulls breakout of $378 and manage to close above the resistance line, the trade on the long side will set up.

Different traders use different methods to confirm whether the breakout is valid or not. Some wait until price moves 3% above the breakout level, others wait for three consecutive closes above the resistance level.

However, we have observed that the best breakouts never look back, hence, waiting for three days may lead to a missed opportunity. Therefore, we can wait for a closing above the resistance line of the triangle and initiate the long positions on the following day.

The breakout can face resistance at $400 and $420. However, we expect the virtual currency to scale both these resistances and rally towards its pattern target zone of $645 to $670.

Notwithstanding, even the most reliable patterns can fail. Therefore, our stop loss will be kept at $340. We don’t want to hang on to the trade if it falls back into the triangle. We shall raise our stops to breakeven as soon as Ethereum breaks out to new lifetime highs. From thereon, we shall trail the stops higher to protect our paper profits.

Note

The chart pattern suggests a resumption of the long-term uptrend in Ethereum. However, this will not get confirmed until the cryptocurrency breaks out and sustains above $380. Therefore, please initiate positions only on a breakout and close above the triangle. Entering presumptive trades may result in losses.

Featured image courtesy of Shutterstock. 

 

 

 

 

 

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Analysis

Long-Term Cryptocurrency Analysis: Bitcoin Flirts with $8000 as Altcoin Bull Persists

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Bitcoin’s swift recovery was the main topic of the week, as the most valuable coin not just regained its steep losses, but hit a marginal new high towards the end of the period. The entire segment is experiencing capital inflows as the total value of the coins climbed above $230 billion for the first time ever after finally leaving the vicinity of the $200 billion mark.

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BTC breached the $8000 level before turning slightly lower on Friday, but despite the severely overbought daily chart, it is still trading near its all-time highs. As the long-term picture still suggests a deeper correction, investors should wait with opening new positions and traders should also control position sizes here. Key support levels are found at $7700, $7000, and $6700, while the recent key break-out level at $5000 still hasn’t been re-tested.

BTC/USD, Daily Chart Analysis

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Dash is still the most bullish altcoin from a technical standpoint, despite this week’s short-term correction, as the coin is trading above its prior all-time high, and this weekend, it looks ready to test the break-out high near $500. Support levels are still found at $400, $360, and $330, and as the long-term picture is approaching overbought territory, investors should only hold on to their positions here.

DASH/USD, Daily Chart Analysis

The other major altcoins are also mostly in bullish setups, with some of them already in the latter stages of this cycle, like Monero and IOTA, but elsewhere in the segment, there are still opportunities for both traders and investors. Let’s see the detailed long-term view.

(more…)

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