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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 (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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  1. jusdavi

    August 24, 2017 at 1:18 am

    Check out CPROP https://cprop.io

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Analysis

Crypto Update: Chinese Crackdown Triggers Next Leg of Correction

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The cryptocurrency segment is crashing again, with double-digit losses across the board, and with several coins shedding around 30% in one day amid the widespread and heavy selling. The sell-off was triggered by reports on a new set of measures by the Chinese authorities limiting crypto trading, which added to the still looming South Korea related regulation worries. Bitcoin tested the mini-crash lows at $11,300 today in early trading, dipping slightly below that level before a strong bounce started.

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The most valuable coin is now between two crucial support/resistance lines, with the other ahead at $13,000, and as the downtrend is entering its more mature phase the $10,000 and $9,200 levels could come in play, with a possible dip to the support zone near $7,650.

BTC/USD, Daily Chart Analysis

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Interestingly, the coin is still hovering within the daily range of the crash of December 22nd, and that points to a very active and volatile period ahead near the low at $11,300, as automatic orders will likely get triggered on both sides of the market.

The short-term setup is bearish, and although it’s possible that the primary support level will hold, odds still favor another leg lower, following the exponential run-up at the end of last year that pushed sentiment into bullish extremes.

BTC/USD, 4-Hour Chart Analysis

Altcoins

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Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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Analysis

Music: One Overlooked Use Case

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So far in this year, Ethereum has been the crypto star appreciating over 80% to a recent record of $1402. All this suggests that more and more applications are being created. We know this by the demand for Ether, the gas that drives the Ethereum network.

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The reason behind the explosion of Ether demand was confirmed by Ethereum co founder Steven Nerayoff in a CNBC interview where he claimed the number of Ethereum projects today is more than 10 times year ago levels.

One of those areas is the music business and there are several names appearing on the ICO list to add to your research agenda.

Why The Music Business Needs Help

Music may live forever but the business side has been in trouble for a long while. Over the last decade there have been only three years when the global value of music sales increased. The combination of digital music and outright pirating through peer-to-peer sharing has much to do with the long-term trend.

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Throughout the world there are 69 copyright and royalty societies given the responsibility of documenting, collecting and distributing music royalties. That means collecting a few pennies whenever a song is played on the radio, Internet or anywhere else. Four of the largest of these is in the US, followed by Japan, Germany and Britain. Their operations are truly byzantine.

Experts in the music-publishing field confirm the time between music usage and royalty payment can run close to 24 months. Even then not all royalties are distributed. According to my sources, there are often millions of dollars collected by royalty authorities everywhere that never make it to the entitled recipients. That sort of practice borders on criminal behavior but copyright and royalty societies operate in a sub-rosa manner making it difficult to understand their policies.

In the past just 4 major record labels controlled over 80% of the industry. These giants could afford a full time legal department to pursue royalty issues dominated the music industry. Today, however, independent labels represent almost one-third of the market. This means less democracy in the business with the young independent artist at a particular disadvantage.

Of course, musicians aren’t the only group of artists loosing out on their pay. There are writers, poets and painters that go largely unprotected.

The music business is just easier to track because it has more data. Yet in spite of all the information, the music industry is widely recognized for its lack of transparency. Blockchain technology has the ability to disrupt long-standing industry practices.

ICOs To The Rescue

The number of Ethereum based white knights is starting to appear on the horizon promising to rattle the industry and hopefully restore some democracy on behalf of the independent artist.

One simple business model comes from a startup SingularDTV who is attempting to build their ecosystem on top of Ethereum. Here is the basic value added proposal.

SingularDTV tokenizes the artist work. In doing so the artist is turning their music into a financial asset. Anyone who buys into an artist’s token owns a share of the creation and its income stream. The more people consume an artist creation, the higher goes the token price.

Only time will show if SingularDTV succeeds with this model. The consequence of this model is how it eliminates many of the middlemen and nefarious influences in the industry. Instead of singing on a street corner for bread, an artist could raise money upfront without relying on an advance from a record label.

According to SingularDTV, distributing content via blockchain would allow artists to skirt streaming platforms like Spotify to earn royalties on their own terms. Now that is true democracy.

SingularDTV may stand out a bit in the news due its recent ICO success in raising $8 million but they aren’t the only player in the music game. Names like Voise recently raised $1 million as well as Soundchain, Blokur and Opus to name a few.

I am no longer a registered investment advisor, which means I don’t go around making investment recommendations. So I will only suggest this group to put on your list of late night reading. Next time, I will take a closer look at more of these names.

Featured image courtesy of Shutterstock. 

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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Analysis

Technical Analysis: Cryptocurrencies Start Week on a Quiet Note as NEO Shines

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The broad Bitcoin-led correction continued to dominate trading in the crypto-segment throughout the weekend, as the most valuable coin drifted sideways above the key technical level at $13,000, with dwindling trading volumes.

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BTC remains in a declining short-term pattern, although the digital currency still holds well above the mini-crash lows from December, spending almost a month now in the daily range of the year-end plunge. We still expect the largest coin to complete the current cycle with a move below the crash lows and the $10,000 level after the stellar rally of the previous months. Key support is still found near $13,000, with further levels at $11,300, $10,000, $9000, and stronger levels at $8200 and $7700

BTC/USD, 4-Hour Chart Analysis

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Altcoins also settled down across the boards with only a few coins registering strong activity. Ethereum and NEO have been among the coins making headlines, as the second largest coin continued to grind, higher still trading near its recent all-time high today. The price of the ETH token is moving in a short-term uptrend, in the face of the stretched momentum indicators, but we expect a meaningful correction soon, and long-term investors should wait for a more favorable technical setup before entering new positions, with key support levels at $1000, $850, $740, $625, and near $575.

ETH/USD, 4-Hour Chart Analysis

Ripple remained under heavy selling pressure in the meanwhile, as the oversold bounce of the weekend faded away and the coin got close last week’s lows again. As the short-term downtrend is intact, traders should stay away from entering new positions, while investors should wait for short-term sell-offs towards the main support levels at $1.50, $1.25, and $0.85 to add to their holdings.

XRP/USDT, 4-Hour Chart Analysis

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Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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