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ICO Analysis: Everex Capital Transfer System

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ICO Analysis: Everex Capital Transfer System

Introduction

This article was posted on Tuesday, 07:57, UTC.

Everex, whose token sale kicks off July 24th, is going back to an early digital asset use-case for its distributed endeavors. Blockchains have become known for quick transaction resolution times. For instance, Ethereum has offered transactions in under one minute. A new token sale looks to tap into this potential. The Everex capital transfer system seeks to “ease the financial inclusion of two billion unbanked, or underbanked adults around the world.”

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Everex has two years of experience developing blockchain applications. In its first year, it built a digital gold wallet under the moniker Midas Reserv. The Singapore-based project started developing on Ethereum in 2015 after first developing on the bitcoin-based Counterparty platform. After moving onto Ethereum and cash services, the company built out four products which have been tested: Chainy, Ethplorer, Cryptocash, and Everex Wallet.

Machine Learning Boosted Micro Lending

Incorporating Agrello “blockchain-based self-aware agents-assisted smart contracts” for its micro-lending contracts, Everex believes the combination of machine learning and artificial intelligence can fuel its distributed credit scoring algorithm. “…[T]hereby achieving more accurate results and higher degrees of automation that lower the cost of providing micro-lending [services].”

Already, Everex has been recognized by the Remittance Technology Awards (RemTECH), and was recently chosen to take part in a Bangkok Bank accelerator with the opportunity to present to institutional investors after the program’s completion, according to private communications with project team members.

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With the business model seemingly tapping into very promising markets, let’s see where the real value is in the Everex project, and whether or not it is enough to get you excited.

Value Proposition

Everex’s flagship product, Cryptocash, is “a fiat-pegged, fully reserved ‘stablecoin’ issued by a decentralized and federated network of cash custodians and underwriters.” Known for their consistent value, Cryptocash’s stablecoins are pegged to the value of fiat currencies.

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Built in the Ethereum native coding language, Solidity, the smart contract-powered Cryptocash is designed as digitized fiat currency. Via the system, borrowers can take out loans in national currencies and pay them back in others. Everex uses the example of a loan in blockchain-based Thai Baht (THBEX) and repaid in Russian Rubles (RUBEX).

Cryptocash units are named after the currencies of central banks. For instance, the Cryptocash version of the US Dollar is referred to as ‘USDEX’.

Cryptocash tokens are provably underwritten by balances held in accounts of financial entities, or other trusted third-party cash custodians (…) Cryptocash tokens can also be converted from one unit to another, e.g., cryptoUSD (USDEX) to cryptoBaht (THBEX).

Cryptocash can be deposited and redeemed via an “independent network of exchanges within a country using bank-to-bank transfers, an ATM network or in cash.” Everex says that “cash-in and wallet-to-wallet transactions” are free of charge. Accepting Cryptocash payments comes with a 1% fee. Withdrawal is free of charge. Generally speaking, the Cryptocash eco-system is largely made up of smart contracts based on the ERC20 token standard, according to the project’s white paper.

EVX Token

The publicly-traded EVX native token, unlike many tokens issued in the ‘ICO’ industry, has a utility. The token, which is currently being offered per a token sale, serves as “fuel of an internal reward system of the Everex eco-system.”

Employing blockchain technology and machine learning for microcredit and remittance services on mobile phones, Everex’s EVX token acts as the proof of EVX ownership required to access Everex’s advanced features, like immediate and on-demand credit.

The token also plays a key part of Everex’s capital transfer system’s governance model. Each Everex wallet, which holds a predefined amount of EVX, cannot be used without a minimum balance of the native token.

As part of our internal reward system, EVX tokens are used to improve user’s credit score. The more EVX a user posses, the better the offered loan conditions since the user owns a larger stake in the Everex system.

Everex users can vouch for each other with their own EVX. “…The borrower [then] receives improved lending conditions. In case the borrower pays back the loan as specified, both, the borrower and the vouching user, are rewarded with EVX tokens,” writes Everex. “…Lenders can earn EVX tokens by providing loans as a reward for their risk in addition to the paid interest rates.” EVX holdings allow low-rated individuals and small businesses to improve their credit score. EVX will be accepted as collateral on loans over the system so borrowers can access credit.

When users fail to fulfill their end of a loan agreement, EVX tokens are levied via pre-designed – and open-source – smart contracts. EVX tokens are just one part of establishing credit parameters in the EVX system, alongside other factors such as social media, etc. When users pay loans back on time, they are rewarded with an EVX bonus, increasing the credit score. Late payment results in an Everex levy.

According to a recent press release announcing an ongoing 48-hour pre-sale, Everex promised to share the company’s success with EVX token holders. “Surpluses from successful business activities will be used to launch quarterly buybacks, in which Everex will purchase EVX at market price from holders via a so-called ‘reverse ICO’,” reads the press release. “EVX tokens acquired this way are distributed among the community for free as a means of user acquisition.”

Use Case

More than 100 Myanmar migrant workers in Thailand – over 46 days – exchanged 1,100,00 Thai Baht ($31,000) using Everex wallets and Cryptocash.

The Myanmar migrant workers in Thailand elect a community leader who represents a group of workers and collects the transfer money,” explains Everex in its white paper. “In cooperation with Everex, the community leader [converted the] collected Thai Baht into the Cryptocash equivalent THBEX and [transferred] it instantly over the blockchain to a licensed currency exchange in Myanmar. In Myanmar, the Cryptocash THBEX [was] converted to the countries local currency Kyat and provided to the receiving families of the migrant workers. In order to transfer the Thai Baht-based Cryptocash back to Everex, the Myanmar financial institution uses the available funds to import goods and services from Thailand using Everex as a middle man.

Alongside the above-mentioned frontline tools, Everex also designed Chainy and Ethplorer. Chainy verifies proof of existence for documents, and Ethplorer allows individuals to follow token sales, token generation events, token distribution events, and initial coin offerings.

Everex Team

The Everex team is headed by CEO and founder Alexi Lane. According to the Everex website, Mr. Lane has more than 15 years of executive experience in capital markets including with Morgan Stanley and Wealth Strategies Group. Alexander Kakunov, co-founder and Chief Technical Officer, has more than 15 years developing enterprise level software, including Systems Architect and Product Manager for high load online services.

The Verdict

Everex’s simple yet novel approach warrants 5 points. Where others have aimed for far away galaxies, Everex stuck with the moon: using Ethereum for cash-transfer.

Risk

Ethereum could experience scaling issues similar to Bitcoin if it doesn’t change its consensus algorithm to proof of stake, as is stated in its roadmap. For this, we deduct .25 points.

Growth Potential

Everex clearly has the potential for growth. Its team has experience developing on multiple platforms. It has been recognized by RemTECH for its “Service Originality” (and at the United Nations, to boot) and will be entering into an incubator program with Bangkok Bank in the coming months.  That’s worth 1.5 points.

What’s more, the overall idea is simple and elegant. Ethereum as a medium for cash-transfer is not a common project. It is likely Everex is the only startup using Ethereum for cross-border transfers and remittances.  That’s worth 1 point. Its dedication to solving micro-lending via blockchain – largely in thanks to its strategic partnership with Agrello – could place it as a first mover in the cross-border crypto-fiat industry.

5 – .25 + 1.5 + 1 + .50 + .25= 7.50 out of 10. 

This high score can be attributed to the fact that Everex has been used to transfer cash with positive results, been recognized by global institutions, partnered with key strategic blockchain partners and financial institutions all with a comparably simple goal in mind: cash-transfer. Its microlending services would be a boon to disenfranchised people across the globe, as well as imbues EVX with the utility much of the crypto-community desires.

Investment Details

Everex’s token sale begins July 24th. It ended a recent presale in which its undisclosed cap was met within 48 hours. Buyers received a 20% bonus on top of their EVX purchase. While the Presale cap was undisclosed, the token sale is capped at $15 million.

Featured image from Shutterstock.

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Justin OConnell

Justin OConnell

http://www.cryptographicasset.com

Justin O'Connell is the founder of financial technology focused CryptographicAsset.com. Justin organized the launch of the largest Bitcoin ATM hardware and software provider in the world at the historical Hotel del Coronado in southern California. His works appear in the U.S.'s third largest weekly, the San Diego Reader, VICE and elsewhere.

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