Ico crowd magazine, issue one, september 2017 by Ico Crowd

www.icocrowd.com

PARIS HILTON AND

FLOYD MAYWEATHER

ISSUE #1, september 2017

ICODAO

DISTRIBUTED VISION FOR THE INITIAL COIN ECONOMY

WHO NEXT?

SOCIAL MEDIA

Thatâ&#x20AC;&#x2122;s Built To Deliver On The Next Economy

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FOREWORD

ISMAIL MALIK Editor-in-chief DONOVAN OBOSI Head Analyst

Unlocking value across the attention chain

ANNEMIEKE DIRKES Managing Editor PAM TATRO Content Editor TZVI SHISHLER Marketing Photo credit © Shutterstock

If you would like to advertise with us or have any other queries please get in touch at info@icocrowd.com Disclaimer. All opinions and views expressed in this publication are those of the author only and do not necessarily represent the views of ICO Crowd magazine, its Management or Advisors. All content of ICO Crowd Magazine, in particular but not exclusively, photographs, businessdetails, facts and figures, names, adresses and dates, historic details and offers, are the sole responsibility of the author of each artice. Copyright violations by the author are the sole responsibility of the author and ICO Crowd magazine can not be held liable, whether on the whole or on particulars. www.icocrowd.com

by ISMAIL MALIK Chairman & Executive Editor ICO Crowd

words, readers are emerging as a vanguard of distributed marketing by catalyzing plurality, diversity and virality across multiple streams of news, narratives and content.

Now, where do ICOs come in? The Basic Attention Token, or BAT, came into being to The power shift from content creators to address the invasiveness of digital ads that content consumers began more than a decade media consumers are now starting to block by ago, materializing into a landscape dominated paying an additional fee to the likes of YouTube by self-generated user content, crowdsourcing and Hulu. The ERC20 is surfacing as a token and crowdfunding. of value in an open source platform, which is fast becoming decentralized. Blockchain app Today, a hitherto uncharted model of platform Ethereum has made it significantly disruption is emerging on the radar of easier to create or obtain new tokens. There publishing ventures: the attention economy were roughly 6,073 ERC20 tokens to close out and with it the birth of ICOCROWD. August 2017, and that number is expected FUND. This model hinges on a collaborative grow manifold every month. and participatory approach, which elicits a sustained engagement from target In the September edition of ICO Crowd, the stakeholders and audiences. Club that trend theme of emphasis is how tokenized assets are with the influx of initial coin offerings, or drawing interest and curiousity not just from ICOs, seen at a broader level over the past six traditional investors but from mainstream months, and the possibility of a revolutionary consumers, too. This movement of neweconomy where audiences turn into content age token-based investing reflects a trend, evangelists becomes apparent. which reconfigures the publishing business to an efficient and interactive machine where So, how does this work? Consumers are publications can act as funds for readers, more wont to moving towards products and who then become investors. That means news outposts that they hear about from readers subscribing to such publications can “trust filters” like friends and other reliable get rewarded, based on the success of their sources, rather than brands that manifest on outreach to other potential readers and their computer and phone screens through stakeholders in their own networks. pervasive ads. In a transitioning publishing industry, where revenue is now driven more Engaged subscribers, who unleash previously by subscriber sign-ups than advertisements, unrealized value to further interact with readers are not only more directly part of the content and become a localized distributed content they consume but also increasingly evangelist for that content, are a large part of proactive in sharing the key messages of that a publishing industry as it continues to evolve content and their own perspective on those against a backdrop where crypto-currencies messages. are already growing as a destination for investment banks, lenders, and promoters This brings us to the multiplier effect. The of tech and social media enterprises. These wider a reader’s outreach of one or more subscribers, who create a virtuous circle of content forms to his/her own networks and value from publisher to content to reader, are communities, the greater the awareness the stray beads that will complete the link in and interest among newer audience groups. a chain of concatenating events of content And that outreach is exponential. In other creation and interaction.

CONTENTS 4 6 10 12 14 16 18 20 22 24 26 28

Advisory Board Social Media That’s Built to Deliver on The Next Economy ICODAO: Enter the Future of Trading with the Master Coin Investment Manager // ALEX APELDOORN

Investing in an ICO? // MARK MANNEY

WandX: Financial Instruments on ERC20 Tokens Using Smart Contracts The Crack in the ICO Shell: Security Issues Unmasked for ICO Projects // PRAKASH PRASAD Gitz: A Decentralised Referral Protocol // SADIQ ABBAS

Influencer Exchange: A Decentralized Influencer Marketing Platform // ALI AFZAL APPII: Transforming the Recruitment Sector by Verifying Candidate CVs via the Blockchain // GARY MCKAY Celsius: The Credit Coin // ALEX MASHINSKY

ICO: A Disruptive Decentralization of Capital Markets // MUKHTAR MUSSABETOV BlockEx: A Platform with a difference // ADAM LEONARD

30 32 33 34 36 38 40 44 45 46 49 50

Avalanchain. Blockchain of Data Streams // YURIY HABAROV

Ewaste.io: Getting Some of That Value Back from Your Old Electronics // JITESH VARSANI Snip: The Future of News Will Come from The Blockchain // RAN REICHMAN Fractional.io: Fractional Ownership and Value Creation in a Shared Economy // MIKE KESSLER

SocialCash: The Next Big “Unlock” For Social Media // PAUL TAYLOR Wrisx: World’s Risks and Research on the Blockchain // DR. VLADIMIR SHIPOV GIFTZ™ // AMETHYST PINES

Boule: Remote Voting Technology // CLAUDIO PERLINI

DomRaider: The pro-blockchain European leader in Drop Catching Crowdsourcing of ICO Reviews // PRIYABRATA DASH

Investing in Real Estate with Blockchain Technologies // ENRIQUE DUBOIS ICOFILTER.ORG: The Dapp-Based Community That Curates ICOs // DAVID MURRY

52 56 58 59 60 62 64 66 68 70 72 74 76 78 80 82 84

BABB: The New World Bank for The Micro-Economy // RUSH AVERROËS Ammbr: Democratizing Broadband Access Globally // DERICK SMITH

Paris Hilton

Floyd Mayweather

ICO Design and SEC Rulings // STEPHEN ROWLISON

Introducing Brickblock A First-of-its-kind Blockchain-based Investment Platform // CHRISTIAN NÄTHLER

NaPoleonX: A Decentralized Autonomous Fund, a Disruptive Investment Revolution // STEPHANE IFRAH

Logically Consistent Principles for Token Distribution // DAN LARIMER ICO Secured by a Land Asset: Sosnovkino LLC // EKATERINA MAKHNOVSKAYA Put Your Money Where Your Technology Is… // PAUL TATRO

Spectiv: Revolutionary Virtual Reality Streaming Platform Supported by the Blockchain // DYLAN SENTER Ekasi Bucks: Brings Financial Inclusion to Poor and Low-Income Townships, Households and Individuals // LUCKY KGWADI TenX: Bringing Crypto into the Real World // MICHAEL ANDREWS

SynchroLife: Building a Global Restaurant Recommendation Platform with Blockchain Technology // LAURA SYMBORSKI LakeBanker: Free Banking for the World and Cryptocurrencies for Billions // THOMAS XIE Anacoin. Promoting Peace with Blockchain Technology // ZEENA QURESHI Spheris: Decentralized Application Marketplace to Disrupt App Distribution // DAVID SHABUN

86 88 90 92 94 95 96 98 100 102 104

ETHLend: Decentralizing and Revolutionizing Lending Globally // MARTIN WICHMANN

Rockchain. Opening the Public Blockchain to Private Data // SÉBASTIEN JEHAN DentaCoin: The Future of Dental Care on The Blockchain // DONOVAN OBOSI ICON: The ICON Interchain Connects Every Blockchain in Existence // JH KIM

SPARC: The Research Platform of The Future

LAToken // DONOVAN OBOSI

Negotiating the ICO minefield Is ZILLA The New ‘Amazon for ICOS’? // ABASA PHILIPS

DENTALFIX: A Decentralized Blockchain Platform for Dental Clinics and the Supply Chain // SERGEY SAFRONOV RECoin: The Flagship of Charitable Cryptocurrencies is About to have ICO // ANTON SHMERKIN

ACT: Ready for World 2.0 // DWIGHT SPROULL

ICO UNIVERSITY: El modelo ICBM para invertir exitosamente en ICOs // ISMAEL SANTIAGO

Advisory Board SUSAN POOLE

BRYANT NIELSON

MATT ARMSTRONG

Founder, BlockBridge Advisory Co-Founder, Blockchain Training Institute

Executive Director at The Blockchain Academy & CapitalWave Inc. Speaker

CEO&Founder of Crypto Camp

SIMON COCKING

BRETT KING

MARC KENIGSBERG

Senior Editor at Irish Tech News Freelance for Sunday Business Post, Irish Times, The Southern Star, Dublin Glob

Speaker, Startup Founder, Bestselling Author, Radio Host, TV Commentator

Founder of BitcoinChaser.com

SEAD MUFTIC

SERGIO A. FERNANDEZ DE CORDOVA

ANDREY GOLUB, PhD

CEO at Blockchain Information Exchange Security Corp

Chairman – P3SmartCity Partners, Inc Private Sector Advisory Group, SDG-FUND, United Nations

Entrepreneur, CEO & Founder @ELSE Corp- a Virtual Retail company

MUKHTAR MUSSABETOV

EMMANUEL R. GOFFI, PhD

THEODOSIS MOUROUZIS, PhD

Blockchain Entrepreneur, Founder at BlockSpace Labs

Associate doctor with Science Po-CERI Research fellow with the Centre FrancoPaix, at the Université du Québec à Montréal

Program Director of MSc in Business Intelligence and Data Analytics at Cyprus International Institute of Management (CIIM) Research Fellow at UCL Centre of Blockchain Technologies (London,UK)

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Social Media That's Built to Deliver on The Next Economy 6

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The blockchain based transformation currently taking place in social media offers one of the most exciting opportunities in tech and is creating the perfect storm for new social media disruption, amidst an escalating attention economy. The attention economy is at an all-time premium high, as the blockchain seeks to decentralize how we pay attention in the next economy. Blockchain technology’s ability to replace centralized platforms with distributed systems is disrupting the status quo attention economy, by providing capability to spread both content and profit to users through cryptocurrency rewards, bolstered by community inter- for their attention. Nowhere else online by action on social media. is this more prevalent than on social CHRISTOPHER J. KRAMER media, however there is a growing unCEO, ongcoin.io THE GROWING PROBLEM ease with the current social landscape Social media giants have been able to that has consumers seeking alternative capitalize on all the rich content and solutions. user data, effectively earning massive profits at the expense of their users' pri- "Our reality is now digital,” says Derin vate information for far too long. At the Cag, Board Member at Humaniq. same time, these centralized social platforms, have become massive "control Cag says: centers" over people's online existence. Consumers of social media are seeking the highest value for their time and want to be in control of privacy, information and monetization. They do not want to be censored, nor do they want tricky algorithms manipulating them on social media. Consumers want to maintain the integrity of social channels without fear of being shut down by centralized control centers.

“Although the mainstream social media platforms make billions each year from advertising revenues, they do not reward their users financially. Blockchain technology is transforming this by paying people their fairshare to post things... The next frontier in terms of Blockchain technology developments in mass communications will most likely be in decentralization.”

Nawaf Abdullah, Founder of eBitcoinics believes that the immutability of data stored on the Blockchain is an essential benefit that the technology brings THE GAME CHANGER IS HERE to the social media industry. The market is ripe for a social media "game changer", but only one that ofAccording to Nawaf: fers consumers fair exchange for their “Any layman understands Blockchain basi- time, attention and complete control in cally as a ... path that can never be broken, the next economy. whatever it is that we have on the Blockchain can never be altered and this estab- Now, more than ever, consumers desire: lishes the concept of trust when it comes to • Data privacy data.” • Increased control over data and monetization He notes that social media is all about • Compensation for time, content and data and that Blockchain, therefore, imcontributions made to social media proves security and trust by assuring • Ability to filter through the "noise" users that content has not been manipI.E. fake news ulated. • Tools to access relevant information more quickly A TRANSITIONING ATTENTION • No tricky algorithms ECONOMY • No top down censorship The basic ideas behind the attention • Streamlined experience economy are simple. Such an economy facilitates an exchange where consum- Another factor to consider is that peoers agree to receive services in exchange ple are still accustomed to the status

quo social networks and won't immediately jump into a new system. The major social media giants have a significant share of the attention economy, so any disruptive platform should be thoughtful of the current environment and create an experience that allows people a simple transition into the next economy. In their book - Blockchain Revolution, How the Technology Behind Bitcoin Is Changing Money, Business, and The World -Father and son co-authors, Don and Alex Tapscott state,

"We believe that the economy works best when it works for everyone, and this new platform is an engine of inclusion." (p.25) "Sort of the ultimate Tamagotchi, the blockchain is a globally distributed nest egg" (p.35) Yes, the blockchain is poised to transform social media in the next economy by offering censorship resistant, global ledger technology that puts each person in control of their data and monetization without the requirement of top down control. As the blockchain continues to mature, further disruption appears inevitable. Sources: Forbes Perianne Boring October 6, 2016 Readwrite Alex Iskold March 1, 2017 CoinTelegraph Iyke Aru Aug 9, 2017

Blockchain Revolution Don & Alex Tapscott 2016 Humaniq Derin Cag, Board Member eBitcoinics Nawaf Abdullah, Founder

Pre-Pre ICO

SEPTEMBER 2017

ICODAO

Enter the Future of Trading with the Master Coin Investment Manager ICOs or Initial Coin Offerings have become a fast-growing way for small disruptive companies to gather funds. With the use of blockchain technology, ICOâ&#x20AC;&#x2122;s are being launched on an hourly basis and investors are rallying to invest in new ICOs. With the launch of each new ICO countless datasets are generated by supporters, these data sets can be very biased, creating a skewed view of the ICO and its future potential. 10

by ALEX APELDOORN ICODAO Project Lead

To make an educated investment deci- data to the investors. The platform sion, an investor needs to sift through has an integrated trading desk that all this data, understand also allows investors what the ICO is about to set up trades at any and how it has been regiven moment in time. Pre ICO ceived by the ICO comIn Addition, the platmunity. The ICODAO form will give support and ICO dates platform gives investors to companies that want TBA the tools to make eduto launch an ICO on the cated investment deciICODAO platform, givsions. The ICODAO fund ing investors the homewill include the option to participate in based advantage. our own algorithmic fund based on a machine learning core system that will ICODAO is based on the Avalanchain, invest your money for you. with its industry proven and de-facto standard JWT token. The value of ICODAO PLATFORM the tokens that are issued during the The ICODAO platform works as a hub ICODAO crowdsale will be based on that gathers data from various sourc- the performance of the investments es, to structure, clean and present the made by the ICODAO, as well as the

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possible to predict the behaviour of a market, given certain constraints. The proof of this is in the investment management sector where the use of algorithms, prediction models and high frequency trading has become the norm.

In Addition, the platform will give support to companies that want to launch an ICO on the ICODAO platform, giving investors the homebased advantage. The investments are made by A.I., that combines the large volumes of data on the ICODAO platform to make rapid decisions.

ICODAO reaches deep into the well of artificial intelligence, especially machine learning, natural language processing and data analysis algorithms to trade on the market of ICOs. Consider following this example as an illustration of one of the ICODAO solutions: By extracting relevant information from the white paper that introduces an ICO and putting it into context via data analysis we can extract precious data. For example, the reliability of authors can be estimated by relevant published work in the corresponding field. We can estimate the interest of the cryptocurrency community in the white paper based on the number of likes, follows and activity on relevant social networks. With deep learning algorithms beating humans in complex pattern recognition challenges, we are confident in the ability of this technology to accomplish the tasks set by the ICODAO. By using self-learning bots, we make the fund a constantly evolving, learning and improving system. This leads to more strategic investing and trading decisions backed by the knowledge collected all the way from the white paper to the launch.

We use blockchain technology for multiple reasons. Most importantly, we understand that when it comes to investments, trust is completely funWe use blockchain technology for multiple damental.

reasons. Most importantly, we understand that when it comes to investments, trust is completely fundamental. Thanks to blockchain technology all transactions are public. This gives investors real-time transparency, and creates the ability to see the performance of their investments. Moreover, the transaction costs are minimal and the processing time for transactions is extremely short.

classical supply and demand function. All ERC20 tokens, as well as ICODAO Tokens can be exchanged to Ether and other Ethereum-based assets via the ICODAO Ethereum Exchange Gateway service. Similar functionality for bitcoin based tokens will follow.

With ICOs being launched on an hourly basis, the task of predicting the future success is growing more and more difficult. Especially, because the predictions are based on numerous sources of information. Mainly on the author’s profiles, the social network data, the historical data, the aim of the project etc., this makes the human analysis more and more impossible and calls for an agile and scalable IT solution. ICODAO is fast and reliable; with the inspiration from people with financial expertise, ICODAO uses approaches that have been proven to be successful on the traditional financial markets and adapt them into the fast growing ICO market.

ICODAO FUND MECHANICS Members will receive profits based on the returns of the underlying investments in ICO’s. The investments are made by A.I., that combines the large volumes of data from the ICODAO platform to make rapid decisions. The A.I. will be maintained by the ICODAO team incorporating new and sophisticated algorithms and data sets. Each investor will have a dashboard with data and charts of ICOs and a suggestions feed Thanks to the recent boom in the field of on ICO’s that the ICODAO - A.I. is current- artificial intelligence, mathematical linly analysing. guistic and various prediction models, it is

BENEFITS FOR INVESTORS By using a unique fund structure, the investments are pooled to back the most relevant ICO’s. This gives investors the benefit of huge margins made by our A.I. trading system. Over time the accuracy of the A.I. will increase, which in turn will increase the returns on the investments over time whilst simultaneously reducing risk. Due to the automatic analysis and trading of the A.I. the ICODAO fund will have relatively low fees in comparison to traditional asset managers. ICODAO TOKEN (ICOX) DATA Supply during ICO 1 Billion ICOX Allocation: 50% Token Launch 15% Retained by ICODAO 15% R&D Fund 10% Founding Team 10% Early Backers 11

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Investing in an ICO?

To invest in an ICO (Initial Coin Offering) is to act as a venture capitalist. As such, you need a framework for evaluating the business venture. The purpose of an ICO is not for entrepreneurs to get rich; rather, to provide necessary startup funding. The ICO is a powerful crowd-funding mechanism that can bring a good idea to life. In return, investors are rewarded with something of great potential value: a digital by token. If an ICO is used for the purpose MARK MANNEY it was intended, everybody wins. Founder of I am by Infobeing

As a Blockchain entrepreneur planning an ICO, my venture is asking investors for only the amount of funding required to succeed. The legitimate way for an entrepreneur to earn great wealth is to create something that delivers value and revenue. That is my job. Don’t distract me by making me rich before I’ve earned it. There are 5 key questions to help investors evaluate an ICO.

5 Questions to Ask Before Sending Your Money

Why does the organization need funding? Do you understand what the funding is to be used for, who it will be going to, and for what purpose?

1) Is there is a need for the product in the marketplace? Do you understand the product? Do you know the market? What has the organization done to prove that there is a demand? Who is the customer? What problem is being solved for the customer? Would you use it or do you know someone who would? Will solving that problem change the world? Does the cause feel good and inspire passion? 2) Is there a legitimate requirement for capital? Why does the organization need funding? Do you understand what the funding is to be used for, who it will be going to, and for what purpose? Are you sure the purpose of the ICO is not to enrich the founders? Do they already have access to the funds they are seeking? If so, why are they asking for your money and not investing their own? I am the founder of a Blockchain Platform called “I am” by Infobeing (www. infobeing.com). Prior to our November ICO, we will be forthcoming about how

? much funding we need, exactly where it on the 20% of functionality that delivwill be going, and for what purpose. ers 80% of the value? 3) Is there a solid business plan and revenue model? Is this a paid product? Is the model based on advertising? Is the revenue model based on charging a transaction fee? Is it based on the speculative value of a digital asset?

5) Can the founders be trusted to do what they say they are going to do? Do you know the person’s character? As an investor, you are an essential partner in the success of a venture. Your role is as valuable as that of the CEO. Without you, nothing will happen. You should have access. Get to know the founders. Do you see signs of ego, rigidity, or greed? Is there anything you don’t trust about the person or any red flags? If so, find a different investment (there are plenty to choose from).

All these models are potentially profitable if there is inherent value in the offering, but make sure you understand what the revenue model is. What is the timeto-market? When will the venture begin generating a positive cash-flow? Does this seem acceptable? Before sending your money, ask yourself these 5 questions. Get to know the 4) Is the product design elegant and individuals. Follow your intuition and viable? logic, not your emotions. Successful inIt isn’t enough for startup founders to vestors are those who can see through say what they are doing and why, they hype and ignore the crowd. Consistent also need to explain how. As you con- profits are achieved by those who know sider the how, you should also consid- how to identify value, calmly make a er whether the scope is narrow enough. move, and then unemotionally stick to Does it sound doable? Are they focused a plan. Be that investor.

Are they focused on the 20% of functionality that delivers 80% of the value? Consistent profits are achieved by those who know how to identify value, calmly make a move, and then unemotionally stick to a plan. Be that investor.

SEPTEMBER 2017

The Blockchain Revolution is real. Despite the hype, the significance of this movement is still under-appreciated. Decentralization represents a fundamental shift—something far better than Capitalism as we know it. What is being created with these bold new ventures is a new economic system, beyond the reach of centralized institutions, capable of delivering unlimited abundance and freedom. It is not too late to be a first-mover. If you choose wisely, your upside is unlimited. While the movement is real, those who do not understand it will be scammed— not just by leeching hackers, but also by greedy entrepreneurs who are making hundreds of millions of dollars on ICOs backed by hype and empty promises alone. Use these 5 questions to achieve massive upside while mitigating unnecessary risk. Watch the 2-minute explainer video at www.infobeing.com. 13

SEPTEMBER 2017

WandX

Financial Instruments on ERC20 Tokens Using Smart Contracts One of the main functions of banking is to accept money from depositors and lend it to borrowers to grow their business or fund a project. Over the years, traditional lending by banks and financial institutions has been transformed by securitization and taken to the securities market, while the risk management function has been substantially aided by the growth of the derivatives market. 14

Financial instruments in the real world and trade in stocks. However, these exhelped increase the liquidity of assets changes are centralized services enaand hedge risk; this risk arose from bling you to trade in cryptocurrencies price volatility and credit risk. The rise that are designed to be decentralized, of fintech over the past decade has wit- hence the emergence of decentralized nessed the birth of several digital cur- exchanges such as 0x. Accurate price disrencies and a new asset class. With covery, sufficient liquidity, and hedging by the rapidly growinstruments on ICO CROWD ing cryptocurrencryptocurrencies ICO Dates TBA cy market, key sercould enable largvices such as proer participation in viding liquidity the crypto-marand hedging risk are being carried out ket. WandX is creating infrastructure by cryptocurrency exchanges and cryp- for decentralized creation, trade, and to-asset management platforms. settlement of derivatives and financial products on ERC20 tokens built on the The WandX platform aims to be the wall Ethereum blockchain. street for Ethereum. If you assume that all the tokens on Ethereum are stocks, The WandX platform provides users then exchanges such as Coinbase (anal- with the tools to create and trade finanogous to the NYSE) allows you to buy cial instruments (such as derivatives

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gives users information on what could be an optimum portfolio to create or trade based on the tokens that they wish to hold or the tokens that they wish to create a portfolio with. TECH ARCHITECTURE For enhanced security and ease of use, we have built APIs that are called from our front-end Dapp. These APIs connect with our smart contracts deployed to the Ethereum blockchain. Our token - the Wand token - allows users to use the features on our platform, as well as allowing external Dapps to use our APIs. Hence, all trades that happen through our APIs are charged a small trade fee in Wand tokens. Different types of users of our derivatives platform such as - market makers, sellers, buyers and raters, are given incentives through Wand tokens.

and token based ETF shares). Currently there are over 200 ERC20 tokens on Ethereum, with the list growing larger every day. To enable better price discovery and liquidity of ERC20 tokens, we’re creating smart contracts which can be called using our APIs to create, trade, and settle financial instruments on Ethereum. These instruments include ETFs, Derivatives, or OTC contracts. BETA Our initial product is a portfolio trading application built using smart contracts on the Ethereum blockchain. It allows users to create combinations of currencies (known as a portfolio) and trade this portfolio with a single transaction. This helps users reduce the risk of investing in volatile currencies, as well as enables easy transaction between relatively low liquid-

TOKENS One of the most common questions we get asked is, why release another token? The major reason is governance, but I’ll sum it up here: • Governance: Governance over updates to the software which is separate from the Ethereum ecosystem. Identity management through uPort or Civic, followed by a KYC/ AML for users. • Incentives: Incentive programs for various users, bounties for bug identification, and promoting the use of all the modules of our platform. • Future development: If we decide to integrate the tokens created on other blockchains (such as Tezos, NEO), we would need to be able to introduce protocols such as the COMIT protocol for interaction between the blockchains. It would be more secure and more efficient to do this if we have our own token. • Derivatives contracts: Collateral and margin can be posted in terms of a common currency whose movement is not directly dependent on Ether. • Developing the WandX protocol: The Wand token will be used to access any application on the WandX platform. The functionality in all applications is enabled by APIs. When external applications use any of the WandX APIs, they will be charged a certain fee in Wand; to use any of the applications on WandX, users will have to transact using ity tokens. All trades happen on the EthereWand. um blockchain using smart contracts which are called using our APIs. Aside from enabling creation, trade, and settlement of portfolios, we’ve ETFS built a portfolio optimization algorithm that After a successful launch of our portfolio trading application on the Ethereum Main net, we plan to build out smart contracts which can integrate with creation of portfolios to creating an ETF for which shares can be issued. This ETF would contain a group of ERC20 tokens in a certain ratio. A share in the ETF is equivalent of purchasing the same ratio of tokens for a These exchanges are centralized services much smaller amount. If the price of all tokens enabling you to trade in cryptocurrencies is 10ETH, and 1000 shares are issued, then each share is worth 0.01ETH. This share conthat are designed to be decentralized, tains the underlying tokens in the same ratio.

hence the emergence of decentralized exchanges such as 0x.

We’ve released our prototype on the Ethereum Test net; do check us out and www.wandx.co! 15

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The Crack in the ICO Shell: Security Issues Unmasked for ICO Projects A Starter Guide to Security Vulnerabilities & Illusions in ICO Projects “A great deal of intelligence can be invested in ignorance when the need for illusion is deep.” S. Bellow 16

by PRAKASH PRASAD Cyber Forensic Analyst, Blockchain Researcher

The new flavour of money is digital crypto-token currencies. Investors and crypto-currency enthusiasts place huge investments into ICOs. Some of these ICO projects are trustworthy while others are not. Why? Imagine someone cheating you with a faked token address. The chances of losing all investments are high.

their offering document, that they have a team of developers spending a lot of hours working to build the project. But remember, the appearance may be deceptive. Mostly the ideas are good, but the implementation is a nightmare. Investors put huge faith in these projects with an anticipation of a stable, sustainable platform and crypto-token that can be safely transferred or delivered Furthermore, some of the at the close of the ICO. The ICOs may even indicate in project must be built very pre-

cisely, and should be soundly tested by external security consultants or auditors. Security is often a pain area for ICO investments as there is no blueprint available on testing the security of smart contracts. Accordingly, it´s all about expertise and expert views. SECURITY RISKS: Creation Time token adjustment and change (Modification):

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An attacker can possibly adjust the creation ond social engineering attack can trick them tioned programming-bugs are still present. time before the token goes live. into giving up access to their crypto-token Therefore, the contract must be error-free based smart contracts funded by the ICOs. and secure. Hardware Based Attacks: PDoS (a Permanent denial of service attack) Permissive Timestamp: Blockchain Blocks In addition, a proper due diligence is recan cause a permanent hardware failure. can take any timestamp; i.e.; after or before quired to be conducted to ensure that every The processing power of the powered node the block. This leaves room for exploitation. ICO is safe. Legal, compliance and securican be disrupted. ty aspects must also be implemented to the Arbitrary Mining account. One should Replay Attacks: Replay Attacks are possi- Attacks: To prevent have a basic knowlble due to APIs showing the number of re- this attack, arbitrary edge of the ICO proquests remaining on the API account key, mining must not be cess and Crypto-curSecurity is often a pain area until it gets the desired random number key. allowed once an ICO rency functioning. for ICO investments as there has started. Key-based Attacks: The risk of API keys beKIND ADVICE is no blueprint available on ing leaked out can lead to repeated requests. Re-entrance atNever send funds to testing the security of smart The Key must be hashed. The Response API tacks: In this atan address posted on contracts. Key Hash must be checked with the stamped tack, you do somepublic networks or response to eliminate key exhaustion. thing, you are alforums while particready in the process ipating in ICOs. A proper due diligence is Chain-based Attacks: Any type of exter- of getting it done, required to be conducted to nal query to the remaining API Key must be and you do it again. A Bug Bounty problocked to prevent cross-chain attacks or The risk of the user gram must be ensure that every ICO is safe. chain-based attacks. losing tokens in the launched before the contract is highly ICO is placed for Leaking Decryption Key: An attacker can probable. subscription, to test exploit ICO contracts (servers) and take the security aspects over decryption keys. This has been proved Based on these of the project. to have a disastrous impact. grounds, the Poorly Programmed smart contract is vulnerable to cyber-attacks. The A legit ICO is a treasure for the token holdSocial Engineering Attack: Crypto users security of crypto-tokens can be breached ers as the potential upside can be very reare not necessarily crypto-literate. A 30 sec- by malicious cyber criminals if the men- warding. 17

SEPTEMBER 2017

Gitz

A Decentralised Referral Protocol THE PLATFORM The Gitz Platform is a decentralised referral protocol, initially focussed on the recruitment sector. Sourcing good people, products, and customers quickly and cost effectively is hard for companies. GITZ will enable compaby SADIQ ABBAS nies to tap into a large validated community of people from various fields, who can refer their networks and get rewarded quickly and easily in a smart contract enabled eco-system. The protocol will enable rapid sourcing with specialist communities able to join the platform, provide high quality referrals and receive rewards in a simple and quick manner. THE MARKET The global recruitment market is worth over $400bn+. The UK market alone is worth over £40bn, with the online recruitment market including jobs boards being worth over $3bn (at a conservative estimate). Recruitment is big business and finding the right staff is essential for every firm but is time consuming, expensive and competitive. CURRENT SITUATION Firms currently rely on either large internal recruiting/sourcing teams, spe18

cialist recruiters, hit and miss job GITZ will use Smart Contract techboards or internal referral programs nology to enable a protocol that will for the bulk of their hiring. Different create greater efficiencies within the combinations of these strategies work recruiting industry and many othdifferently from company to compa- er industries in the future. Offering ny. However, with about two thirds a new incentive structure for quality of the people withreferrals, on a trusin the job market tless platform which Pre-ICO token sale being passive, and is open to all. therefore the hardest opens in late August, to attract, the sourcOur protocol used registration is ing aspect is generalwithin the recruitavailable now. ly a long, expensive ment sector, rewards and frustrating provalidated people for cess. submitting high qualWhitepaper available ity candidates as well from mid-August. THE SOLUTION as for placement, Register to receive a GITZ is a validated, meaning referees recopy as soon as it is referral based proceive regular rewards, launched. tocol that will enremain engaged and able companies to spread the word to insource a short list crease the effectivePublic ICO in of qualified candiness of the commuSeptember 2017. dates, for a fraction nity. of the cost of a specialist recruiter and HOW IT WORKS: without the noise of a job board. Ena- • A sourcing specialist registers with bling recruiting teams to spend more GITZ detailing their background, time on interviewing, assessment skills and recent work history for and candidate experience and therevalidation by the community. fore fill jobs faster and more cost ef- • Candidate seeker posts a job and profectively. vides details of the bounty on offer.

SEPTEMBER 2017

• Relevant sourcing specialists are notified of the role and can quickly access their wider networks to invite people to apply. • All job applications are routed back via the sourcing specialist for validation before being forwarded to the candidate seeker. • The company receives resumes alongside the profile of the sourcing specialist. When a candidate is selected for interview, the appropriate reward is released to the referrer. WHY WILL THIS WORK? The recruitment market is a huge business, but hiring the right people is hard and seen as expensive and inefficient. Rewards end up in the pocket of many large dominant such as LinkedIn, Indeed, Monster and the multitude of recruitment firms that have grown to service increasingly specialist markets. The decentralisation of sourcing puts companies and networks directly in touch with each other reducing costs, distributing income to those introducing their network and providing validated applicants in a timely manner.

enabling mass participation in the platform. WHY THE BLOCKCHAIN AND WHY A TOKEN? TOKEN • The token will reward all contributions to the platform and is the only source of reward on the platform. • It is used for all bounties for successful submittals. • It will be used to reward the community for their participation in the growth of the community i.e. recommending people to join the platform, recommending companies who post jobs, rewarding developers, marketing, and product experts who develop the platform. • Tokens earned can be used to post jobs, highlight your submittals and buy internal advertising. • Tokens enable quick and simple international growth.

The GITZ platform has many network effects to enable user adoption, as well as provid- BLOCKCHAIN ing a platform for any engaged community to • Smart contracts enable compaprovide sourcing solutions to their industry. nies to easily set and monitor their budgets. It is a simple to use platform for all users, • Smart contracts also enable the utilising the best of blockchain technology immediate, trustless transfer of whilst maintaining an easy to use interface tokens for successful referrals.

GITZ will enable companies to tap into a large validated community of people from various fields, who can refer their networks and get rewarded quickly and easily in a smart contract enabled eco-system. The decentralisation of sourcing puts companies and networks directly in touch with each other reducing costs.

• Applications, success rates and therefore performance ranking points are recorded on the blockchain and used to distinguish sourcing specialists. • Rewards can be transferred to people instantly, in any location. • The terms of business are built into the contract and this takes away the need for procurement or accounts functions. This saves time and money. THE TIMELINE AND THE FUTURE Pre-ICO token sale opens in late August, registration is available now. Whitepaper available from mid-August, register to receive a copy as soon as it is launched. Public ICO in September 2017. The smart contract is written and functioning on a Beta app, which will be open to select companies from October. The full app will be live by the end of 2017 and additional features/markets will quickly appear in early 2018. To discuss your interest in the preSale please do not hesitate to contact will@gitz.io to arrange a time to speak/meet. 19

SEPTEMBER 2017

Influencer Exchange

A Decentralized Influencer Marketing Platform 20

SEPTEMBER 2017

In fact, the aggregated total following of the Top 10 Celebrities on Instagram is 1 billion followers. Although many of the followers will be the same individuals following all 10 celebrities, individually these people are able to elevate or demote brands by merely mentioning them on their social media channels, which is the key component of a rapidly growing advertising service known as ‘Influencer Marketing’. Global digital ‘ad’ sales will grow to $299 billion by 2021, making up 50 percent of the global advertising market according to a report by MAGNA, IPG Mediabrands' research arm. Influencer marketing is one of the fastest growing segments which is projected to become a $10bn market by 2020. Influencer Exchange (INEX) aims to capture a percentage of this market through their platform that allows advertisers to purchase tokenised outcomes as opposed to an advertising service. An algorithm converts ‘likes’, ‘shares’, and other types of engagements into a tokenised value, allowing brands and advertisers to purchase the end result instead of paying for marketing services. All of this is made possible using the Blockchain, Smart Contracts and AI Bots.

According to research by TapInfluence, 73% of marketers say that they have an allocated budget for Influencer Marketing. Brands and businesses have every reason to put their money behind Influencers, a 2016 IAB/YouGov study found that the use of ad blockers has increased to 47% of 18-24 year olds claiming to by ALI AFZAL use ad blockers to block out all advertising. Compare this to research by ION which states that 71% of consumers are more likely to make a purchase based on a social media reference. Additionally, 70% of teenage YouTube subscribers trust influencer opinions over traditional celebrities. The concept behind Influencer Coin was conceived in 2013 by Julian Sarokin, but the technology was not available to realise the idea. The development of Ethereum Smart Contracts has changed the landscape and the concept can now become a reality. Our goal is to provide a more efficient, intuitive and transparent influencer marketing platform. Heres how it works: 1. Influencers are aggregated onto INEX (Influencer Exchange) and their followers profiles categorised 2. Using an algorithm the platform creates a value of their various engagements such as Facebook ‘likes’, Instagram ‘shares’ etc

ICO Start Date: 1st November 2017 ICO End Date: 31st November 2017

Selena Gomez, Arianna Grande, and Taylor Swift, have nothing to do with Cryptocurrencies, but they are the number one, two and three most followed celebrities on Instagram boasting a total combined following of 320m followers according to Marie Claire. For example, a tourism board may want to promote their latest Beachfront development to drive tourism in the area. They create their account on INEX and purchase a sufficient amount of influencer tokens. On the exchange each outcome will have a variable value based on several factors, it may cost 50 influencer tokens to purchase 1m likes by celebrity status influencers as opposed to 25 tokens to purchase the same 1m likes from travel bloggers. Although under development the platform currently boasts over 100 influencers with a total market reach of 100m people. The technology has been developed over 2 years and is now going through integration with smart contracts and the blockchain.

3. These tokenised outcomes are then sold as packages through the exchange to brands, advertisers and businesses worldwide For example, a tourism board may want to promote their latest Beachfront development to drive tourism in the area. They create their account on INEX and purchase a sufficient amount of influencer tokens. On the exchange each outcome will have a variable value based on several factors, it may cost 50 influencer tokens to purchase 1m likes by celebrity status influencers as opposed to 25 tokens to purchase the same 1m likes from travel bloggers. A built-in supply and demand mechanism will control pricing on the platform. Once the relevant package is purchased the Influencer Marketing magic begins, through the use of Smart Contracts, the purchase activates a contract to fulfill 1000 likes and offers the opportunity to those influencers in the selected category, e.g. Influencers with a majority following in the West. The influencers are then required to fulfil the contract by following the contract requirement post a few pictures of the resort saying they plan to visit next year etc. Smart bots will record all engagement onto the blockchain and this will continue until the contract is completed or the expiry date is reached. All influencers will then receive their payments according to the percentage of the smart contract individually fulfilled. This means that mass marketing campaigns can be achieved easily through the collective following of many distributed influencers. On completion the data is presented to the advertiser through an intuitive dashboard with full analytics. Although under development the platform currently boasts over 100 influencers with a total market reach of 100m people. The technology has been developed over 2 years and is now going through integration with smart contracts and the blockchain. Influencer Coin will complement a host of ICOs that have been launched in the advertising space such as Adex, Adtoken and Basic Attention Token (BAT), all of which have been well received and performed exceptionally well. Influencer Coin will be launching its token exchange on the 1st of November 2017, and will be releasing its MVP in October 2017. To register for the opportunity to acquire Influencer Tokens please visit www.influencertoken.io and complete the registration process. 21

SEPTEMBER 2017

APPII

Transforming the Recruitment Sector by Verifying Candidate CVs via the Blockchain

Private Pre Sale in September

Career verification platform APPII is reducing the cost and time for employers to recruit talent by verifying candidate CVs via blockchain technology. 22

by GARY MCKAY Managing Director, APPII

APPII will launch their career verification and recruitment platform next month offering job candidates the opportunity to seek verification of their CVs, that is, verification of education, work experience, skills, certification, awards etc. Furthermore, the platform has a dynamic CV builder where candidates can create a verified Intelligent ProfileTM, a profile that can be put to

work in finding the best job opportunities available. The blockchain solution enables candidates to seek verification of CV assertions from educational institutions, employers, trainers, and others, in a trusted and simple process. A process that will reduce the administrative costs associated with candidate verification by

SEPTEMBER 2017

providing pre-verified candidates to employers right from the beginning of the hiring process. Using APPII, any employer can seek to view verified candidates at a fraction of the current standard industry cost. Organisations verifying candidate CVs will be rewarded for their efforts, and candidates will also be rewarded for allowing employers to view their profiles. Beyond cost reduction and accelerated hiring, employers will be able to specify the format and configuration of how they view candidates making the hiring process vastly more simple. “Finding a dream role and a dream employer should be quick and easy. Equally, finding top talent should be simple and inexpensive. However, it is challenging, time consuming, and costly finding that dream role and top talent”, says APPII Managing Director, Gary McKay. - “We believe that having the assertions of an individual’s CV verified by educators, accreditors, and employers will make an enormous difference to the recruitment process. Also, it is about time that the main parties involved in the process, namely candidates and employers, were rewarded for providing intermediaries with their data. We want to see candidates monetise the data they provide to APPII, as a custodian of CVs, and organisations rewarded for verifying candidate CVs”. APPII, Latin for farsighted, is a passion project for Gary and co-founder Adi Ben-Ari, a renowned blockchain expert. Having initiated the project in February 2016, Gary, Adi, and the APPII team have spent 18 months building a blockchain platform that can assist job seekers, in particular those with limited access to mentors and career coaches, in developing a professional, verified, CV that can vastly increase their employability.

The blockchain solution enables candidates to seek verification of CV assertions from educational institutions, employers, trainers, and others, in a trusted and simple process. Individuals often find that physical certificates and logs are susceptive to being misplaced. To address this, we’ve used blockchain and a wellknown technology in QR codes to securely capture and verify micro-accreditation and education, eradicating the incidence of loss or misplacement.

or misplacement. Combining these two Complimenting the blockchain expertechnologies streamlines CPD capture.” tise of Adi Ben-Ari and Gary McKay, the APPII board comprises of recruitment Organisations can upload or create mi- industry veterans in Sebastian Leslie cro-education and accreditation inven- (CEO, Wrightson Group) and Anthony tory in APPII. Each piece of inventory is Sherick (Managing Director, Technoassigned a QR code, including meta data jobs and Contractor UK) providing solid such as location, date, time etc. Organi- counsel in how the APPII Platform can sations, providing the likes of CPD, can revolutionise the recruitment sector. distribute the QR code at the end of a course or conference and APPII mem- APPII will undertake a private launch bers capture the QR code via the AP- next month, with a full public launch PII App, automatically logging it against coinciding with the launch of their totheir CV as a verified credential. ken sale soon after. Likewise, museums, art galleries, exhibitions, or youth award programmes, such as the Duke of Edinburgh awards, can utilise APPII to verify and certify the achievements and experiences of students and young adults.

Further information for candidates, verification partners, and employers can be found on the APPII website https://www.appii.io/.

Gary McKay is the Managing Director of APPII. Gary has worked in senior executive roles in multiple sectors including Media (News Corp) and Banking (Commonwealth Bank of Australia). Half of Gary’s career has been spent as a Management Consultant, most recently with Booz&Co., consulting across different industries and countries.

The co-founders are also looking to assist APPII members and organisations with the capture and verification of micro-accreditation and micro-education. “We hear time and time again that the capture and recording of Continuous Professional Development (CPD) is laborious and manually intensive. Individuals often find that physical certificates and logs are susceptive to being misplaced. To address this, we’ve used blockchain and a well-known technology in QR codes to securely capture and verify micro-accreditation and education, eradicating the incidence of loss 23

SEPTEMBER 2017

Celsius

The Credit Coin REVOLUTIONIZING PEER TO PEER CREDIT LENDING: BUILDING A NEW TRUST PROTOCOL The defining strength of blockchain is its decentralized model and distributed network that is capable of bringby ing about a paradigm shift to a more ALEX MASHINSKY “open world.” The operative word here is - “open” - because our world is currently governed or “closed off ” by centralized authorities such as governments, banks and dominant marketplaces. These centralized authorities first emerged as intermediaries to facilitate trade. In an ideal world, there would not be a need for intermediaries -- however, the high probabilities of human deceit and error necessitate it. Instead, we submit our as24

sets to these proxy “trustworthy corporations” where power and authority is localized. These behemoths have opened the door through their antiquated ways and non-accommodating terms.

cial institutions tend to prefer lending to individuals with established credit histories - which young adults lack due to rising student loan debt and the exorbitant cost of living in cities. Thus, the lucky few who qualify for credit cards from such institutions are THE CREDIT CRUX rewarded by paying very high interCurrently, $1.1T, the equivalent to est rates and fees, which make it even half of all consumer credit issued in harder for them to pay their bills. the US, is concentrated with the Young adults are six largest banks. marginalized into These behemoths an ever-increasICO are responsiing number of unMid-November ble for propagatderbanked peoing a biased credple in the U.S beit lending system cause of meagre that doesn’t suit savings and no the needs of the young adult popula- material increase in wages in the past tion, consisting primarily of millen- fifteen years. Hence, they remain unnials and Gen Z. Centralized finan- derserved and feel excluded from the

SEPTEMBER 2017

financial system for a significant portion of time. The lucky ones who do have a credit score and a credit card end up paying interest anywhere from the low 20’s to mid-30’s, which ends up consuming most of their disposable income.

Currently, $1.1T, the equivalent to half of all consumer credit issued in the US, is concentrated with the six largest banks. These behemoths are responsible for propagating a biased credit lending system that doesn’t suit the needs of the young adult population. At Celsius, we have engineered a new global platform to enable peer to peer credit lending. Individuals within the network can apply to receive instant credit from other trustworthy network members depending on their transaction history. Celsius will also enable borrowers to leverage guarantors who are willing to join their digital wallets to our smart contracts to expand a borrower’s credit limit and lower their interest payments.

al platform to enable peer to peer credit lending. Individuals within the network can apply to receive instant credit from other trustworthy network members depending on their transaction history and information attached to their digital identity profile. Additional certified validators can lend their credit to uncreditworthy new members.

CHALLENGING THE STATUS QUO In addition to the millennial plight, the antiquated banking systems’ red-tape and profit-mongering habits forced us to ask our- - Digital Credit Score selves some basic questions, such as: Celsius will assess each member’s credit- Why is it that most depositors get less worthiness based on their digital identity than 1% on their deposits but get charged score from partnerships with prominent as much as 28% when borrowing funds third-parties which provide KYC and AML from the same institution? regulatory verification. We will also incor- Why can't borrowers take loans from the porate user uploaded data, such as extersame people that the bank is borrowing nal FICO credit scores and past transaction from (their neighbours, colleagues, etc.) history on marketplaces like eBay, Amadirectly? zon, Uber, Facebook, etc. and implement it - Why can't these institutions do what is in into the algorithms to create a comprehenour best interest instead of maximizing sive Celsius network credit score. their own profits? - Who can ensure that if the borrower does - Re-distribution of Interest not pay, the lender will be able to recover Celsius will also enable borrowers to levertheir principal? age guarantors who are willing to join their digital wallets to our smart contracts to Banks are also an increasingly unpopular catexpand a borrower’s credit limit and lower alyst to business. The last credit crisis soliditheir interest payments. We provide lower fied the notion that too many banks had belevels of bad debt and higher interest paycome “too big to fail.” To ensure that the sements to lenders while enabling lenders to curity of an archaic system, monolithic instirecover bad debt via an insurance program tutions were bailed out that risked deposicovered by us. tors’ capital while enriching shareholders. Technology and opportunity have advanced, - Distribution of funds and today we can challenge the status-quo of Upon approval, members can use one of the broken lending system. the existing partners debit or credit cards The Celsius team has carefully studied these to immediately access the issued credit to problems and opportunities, and from our transact in the real world with fiat currendiscussions an idea was born: a peer-tocies or with participating banks such as peer lending network running on a universal SVB to access their accounts while paying Ethereum blockchain. lower interest rates than any major credit card. CELSIUS FOUNDATION - THE FUTURE OF CREDIT - Insuring the credit With blockchain in mind, with the use of Celsius issues the credit score and the an Ethereum-based smart contract marketcredit limits and it arranges for the pools place, we built The Celsius Foundation with of lenders who extend their digital assets the intention of providing an opportunity to borrowers and creates a smart contract for everyone to participate in an ecosystem between the parties which includes all the centred around a membership organization. terms and conditions. Celsius then enters The members approve the smart contract as a party to the transaction and provides and the algorithm based credit score. We insurance so if the borrower defaults, Celhave partnered with more than one dozen sius covers the principal loan amount. CelEthereum-based solution providers to create sius is then responsible to recover the sums an ecosystem that enables all aspects of the owed from the parties providing guaranprocess so an individual can join the memtees or the borrower themselves. bership and be issued a smart contract with a credit score and credit limit within minutes. THE NEW TRUST PROTOCOL AND THE Our platform will conduct the Know Your CREDIT COIN Customer (KYC) and Anti Money Laundering The decentralized nature of blockchain (AML) review, Digital identity verification, might be a stark contrast to the structured social media analysis, internet social scoring form of chaos right now. Although an indiand the collection of existing band and cred- vidual’s world seems to be increasingly broad it score information to create a new digital and even global, humans inherently strive for identity and a Celsius credit score that is ac- more personalized, curated experiences. We cepted by our partners. can think of no better way to solve an essential financial need than through a democraWe do this by: tized peer-to-peer lending platform, through - Peer-to-Peer Lending the installation of a new network of trust, At Celsius, we have engineered a new glob- and the creation of the first Credit Coin. 25

SEPTEMBER 2017

ICO: A Disruptive Decentralization of Capital Markets

by MUKHTAR MUSSABETOV Founder & CEO BlockSpace Labs Inc.

BACKGROUND • More than 50% of SMEs and even more start-ups globally, lack access to traditional funding sources which hinders their growth and ICOs may help to fuel much desired economic development; • Continuing economic and national currency instabilities in different parts of the world are already pushing people to convert their fiat currency assets into cryptocurrencies; • As the token market matures and digital assets provide higher returns and liquidity, ICOs can motivate people to re-define personal financial risks, re-think traditional, low interest investment options (savings accounts, mutual funds, etc.), and motivate them to invest more in ICOs; • Even if ICO restrictions are set within a specific jurisdiction, no national regulator can prevent citizens from investing elsewhere; • ICOs may go far beyond disrupting VC funding and will continue blockchain’s general disintermediation mission, especially in the financial and investment industries;

• The success of crowdfunding as an ear- organizations from private, NGO and ly stage project financing concept for public sectors. start-ups paved the way for the ICO. ICOs have a potential to spread beKEY DECENTRALIZATION FACTS yond ongoing replacement of venture ABOUT ICOS: capitalists with users in the block1. A token is a hard-to-regulate, supra- chain Start-up industry and may national, digital asset; simplify the whole corporate invest2. Instant funding accessible for start-ups ment ecosystem by introducing less right after completion of a token sale bureaucratic, more dynamic, goal or and higher liquidity for token holders; performance oriented models, using 3. More distributed ownership, where a static or a dynamic token supply traditional investors may not have and distribution, and even with open special privileges; funding stages. 4. Global fundraising. Most blockchain start-ups are global by definition, and TRADITIONAL with cryptocurrencies spread around (NON-BLOCKCHAIN) START-UPS the world, anyone can buy tokens; ICO's shouldn't be limited to the block5. Emerging and more supportive ju- chain start-up industry only. With risdictions. Some places around the blockchain's capacity to reshape so globe already have more favorable many industries, any start-up may conconditions for incorporation of block- sider tokenization as a funding source, chain businesses (Switzerland, Dubai, whether its business model may or may Singapore, Hong Kong, others), mak- not benefit from using blockchain as a ing traditional hubs less attractive or technology. defunct. PUBLIC FINANCES POTENTIAL EXPANSION, With some modifications and inteBEYOND BLOCKCHAIN AND VC gration with public blockchain elecICOs may serve as a basis for the crea- tronic voting, it may become a powtion of new funding models, including erful solution for approval of nation-

SEPTEMBER 2017

ICOs have a potential to spread beyond ongoing replacement of venture capitalists with users in the blockchain Start-up industry and may simplify the whole corporate investment ecosystem by introducing less bureaucratic, more dynamic, goal or performance oriented models, using a static or a dynamic token supply and distribution, and even with open funding stages. To prevent chaos, Ponzi schemes, scams, pump and dumps, it will require regulatory agencies to sync their activities with ICO investment communities to create and maintain a balanced and fair framework of a selfregulated system based on best practices and avoid excessive regulation.

al, regional and local budgets, including individual projects by relying on a collective wisdom and therefore delivering more rational decisions and preventing wasting of taxpayers' money by incompetent and corrupted officials.

vestment communities to create and maintain a balanced and fair framework of a self-regulated system based on best practices and avoid excessive regulation. However, the success of any national regulation may depend on geographical competition.

NGO SECTOR The UN is exploring opportunities on deploying blockchain and tokens in crowdfunding campaigns to mobilize funds for entrepreneurship development and community projects.

CONCLUSION The ICO market is currently a wild and mysterious place, where start-ups are funded almost instantly, by attracting millions of dollars in a matter of seconds or hours, bypassing an investment or financial intermediary, and offering more distributed ownership.

ICO REGULATION While Australia's securities watchdog doesnâ&#x20AC;&#x2122;t support ICO regulation, SEC has already issued a report concluding DAO tokens were securities, and other regulators continue investigating the actual application and use of tokens and ICOs, closely tracking the rapid growth in ICOs and may treat some types of crypto assets as securities, but in general, they may find it tough if not impossible to create the same, well-defined, regulative environment for tokens as for the mainstream investment world. ICOs have an extremely flexible and liquid concept.

The ICO is a radical disruption of a global capital market, and it solves the biggest problem faced by any start-up or innovative organization: where and how to get funding for an innovative idea before it becomes a viable product or service? ICOs can significantly speed up "idea to product" and later stages, by providing better and timely funding support for the innovation ecosystem in general.

To prevent chaos, Ponzi schemes, scams, ICOs have even greater potential to revolutionpump and dumps, it will require regulatory ize the way how we accumulate, invest, distribagencies to sync their activities with ICO in- ute wealth, and transfer value. 27

SEPTEMBER 2017

BlockEx

A Platform with a difference BlockEx will start its (Initial Coin Offering) ICO dates TBA ICO, Token Sales and Token Generating Event services starting in October and are partnering with ITIRIV to provide it full turnkey solutions for ICO issuers. The partnership has already created a new and innovative product we have called BlockEx is currently in the FCA ERiC. This is in the form of a tranche reverse equity convertible bond blended sandbox for the origination, issuance and secondary trading of priwith an ICO. Issuing an ICO in this form builds in corporate governance and investor protection, ensuring that funds are released when milestones are hit and therefore allowing large capital raises to occur while protecting investors capital from failing projects or tracby ADAM tion.

LEONARD CEO, BlockEx

For existing businesses wanting to develop Blockchain technology, BlockEx and ITIRIV have designed a unique pre-ICO debt financing structure to fund the buildout of the Blockchain solution. This debt financing is structured and digitized on BlockEx, whereby the debt funds the infrastructure and the ICO funds the marketing operations and management of the Blockchain company, with a strong utility token.

The brokerage software comes with a full trade room with both exchange and OTC trading, leverage trading, social trading and a robust back office. Currently BlockEx is building out product extensions to include licensable (securities, trade order, origination and deal flow) management tools as well as regulatory reporting functions for any asset originated on the platform.

vate placement bonds. This will provide ICO issuers an extra layer of good governance and best practice to ensure that token issuance is structured safely and can withstand close scrutiny. BlockEx has been building the platCurrently companies can use the BlockEx platform to create and issue bonds, ICOs and shortly we will roll out trade finance. All assets originated on the platform will be listed on its exchange, which gains liquidity through a network of distributed brokers around the world, including large and small financial institutions.

form since 2014 and is currently one of the few companies with production ready blockchain tools available. With 40 employees in 6 countries, (UK, Bulgaria, USA, Israel, Taiwan and Kazakhstan) BlockEx has global coverage. They are partnering with ITIRIV to provide a full turn key solution for the issuing of ICOs and deliver all projects under the best possible practices and governance. This will ensure that only the very best ICOs will be generated through BlockEx.

framework (Blockchain/DLT) agnostic. BlockEx also provides full turnkey solutions for companies looking to operate their own digital asset exchange via our white label brokerage software.

ITIRIVâ&#x20AC;&#x2122;s Gibraltar based multi-disciplinary consulting team are highly experienced in Blockchain Technology, ICO structuring, Whitepaper Audits, Token Utility Architecture, ICO project management, Marketing, Community Management and Legal support. ITIRIV provides ICO issuers with this bespoke end to end solution.

Currently companies can use the The exchange is HFT capable with in- BlockEx platform to create and issue stitutional connectivity via API and bonds, ICOs and shortly we will roll FIX protocols and is digital asset out trade finance. All assets originat-

This offering is unique in that it brings together an industry leader in good governance within the ICO market combined with the only digital as-

The BlockEx DAxP includes digital asset creation tools, exchange, clearing, settlement, registry and brokerage software. The BlockEx Digital Asset Exchange Platform manages the entire lifecycle of Blockchain based digital assets. This includes origination, issuance, exchange, settlement and redemption.

ed on the platform will be listed on its exchange, which gains liquidity through a network of distributed brokers around the world, including large and small financial institutions.

SEPTEMBER 2017

set platform currently inside the FCA sandbox. BlockEx is currently in the FCA sandbox for the origination, issuance and secondary trading of private placement bonds. This will provide ICO issuers an extra layer of good governance and best practice to ensure that token issuance is structured safely and can withstand close scrutiny. ITIRIV and BlockEx have already started working with a small number of ICO issuers, featuring some of the most established names in blue chip companies with the backing from well-known brands. Of particular interest are ICOs with teams that have a proven track record in addition to having a proposition that demonstrates a real and strong utility for tokenization within their technology. The Partnership will officially launch the ICO platform during the first week of October to coincide with The Blockchain Solutions Forum in Barcelona. Prospective ICO issuers are invited to apply now to be considered for launch on the platform.

ADAM LEONARD // CEO, BlockEx With 20 years of Payments, Ad-Tech and Fintech experience, Adam has had lead the build of several award-winning platforms in the AdTech and Gaming Space and has been solely focused on Fintech since 2011 after discovering Cryptocurrencies. ALEKS NOWAK // CIO, BlockEx Aleks is a former Army officer with broad multi-disciplinary management expertise. A founding member of the UKDCA, he regularly speaks on blockchain to both commercial and consumer audiences. He has been involved in the crypto-currency space since 2011 having worked on numerous alternative currency and blockchain projects ranging from payment solutions through mining to the exchange space.

Fund experience to Blockchain, Token Sales and ICO’s. Having started his financial career in the mid 80’s he has developed a deep and wide understanding of these markets and having been on the forefront of using qualitative strategies in capital markets at Deutsche Bank to quantitative asset management at BAR Rosenberg and with EIM building segregated Fund of hedge funds, it is natural that the development of blockchain and its role in capitalizing Blockchain companies via a utility token is a natural progression in his interest of building and financing new companies.

CHRIS EMMS // Co-Founder Director, ITIRIV Chris started his career at Apple, moving on to Google and then to Berlin where he worked in senior roles for some of Europe’s most exciting tech start-ups. This is also where Chris was first introduced to Blockchain, particularHILTON SUPRA // ly within the fintech space and went on to work Co-Founder Director, ITIRIV Hilton brings a wealth of Financial Capi- with Wave Crest in driving forward cryptocurtal Market, Asset Management and Hedge rency debit cards. 29

SEPTEMBER 2017

Avalanchain. The Blockchain of Data Streams

How On-Chain Streamed Workflows Can Help with Enterprise Blockchain Adoption Let’s talk about the issues Blockchain projects have when used by Enterprises. Despite the true potential for the technology to improve processes and vastly decrease inefficiencies, the ongoing PoC attempts done by many companies, keep reviling fundamental challenges Bitcoin and Ethereum-based solutions are currently straggling to overcome. Here are some basic examples:

by YURIY HABAROV Fintech serial entrepreneur

DATA PRIVACY Regardless of whether we are talking about small companies or big corporates, the data you deal with by itself can be sensitive to public sharing due to business, regulatory or legal reasons (The Data Protection Act is a good example here). Total flat data sharing with everyone, which is the mandate used by most blockchain platforms, doesn’t really suit this situation even in the case of a private chain, simply because the trust level between parties can be dynamic and change over time. In Avalanchain we create Trust Circles for each of those communications and nested chains specifically associated with the Circle. Nested chains derive their data from their parent chain based

on chain predefined automated func- To achieve this, Avalanchain follows the tion (which is our version of Smart Con- approach of message streams based on tracts) and carefully controlled by the the one that has been proven for decCircle’s Access Control List (ACL). ACL- ades in the telecommunications induss are designed to map to existing organ- try to build robust and fault tolerant isational structure consistent systems. easily and their memWe are dealing with bership and permissmall messages, but ICO Dates sions are controlled in we process them in TBA a centralized, hybrid the blockchain way. or fully-decentralized Our process is to sign way with the use of each message with Elwell proven industry and widely adopt- liptic Curve based signatures, encrypted ed x509 Digital Certificates. Optional if needed, on a message-by-message basession-based end-to-end encryption is sis chaining together related messages also supported on message level and it into dedicated chains. is based on the current strongest industry standards (AES256 and similar). An additional important factor when dealing with increasing volumes of data, SCALABILITY is the concept of Functionally Nested The world we know is already built on Chains. They provide the functionalidata. The volumes are increasing dai- ty of transaction aggregation and proly and having two, three, ten or even a cessing within the chain using our anhundred transactions per second for the alogue of Smart Contracts, effectively whole network is clearly not enough. creating workflows on chain and drasEven modern mobile phones can pro- tically reducing volumes. Nested Chains cess more than that. With the coming work well with Trust Circles, guarantees age of machine-to-machine communi- of immutability and the data protection cation (also called IoT) the volumes are that they provide. increasing pretty much exponentially. No doubt Blockchain networks need to Avalanchain’s ability to quickly decrease be able to deal with huge volumes and the volume passing through the netminimal latencies just to remain com- work using Nested Chains, allows natpetitive. Elastic scalability is the must ural sharding and an organic increase nowadays. of total network throughput, leading

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to elastic horizontal scaling where metrics like 10,000-100,000 tx/sec are not relevant anymore; in order to increase the volume, we only need to add more machines to the network and slightly adjust the Nested Chains topology. LAYERED DECENTRALISATION Networks with a permissioned component in them tend to create smaller independent subnetworks, primarily because of data privacy reasons. Additionally, not all the parties allowed to see the data in the subnetwork, naturally require write access and ability to post transactions into them. (All monitoring and reporting use cases belong to this category).

rithms may not be the best choice, especially for the case of free transactions support. Also, they do not provide any help with transferring JSON-represented (account, balance, etc.) state between the nodes. The JSON-friendly variation of the CRDT mechanism which serves as the main Consensus choice in Avalanchain allows better and lighter but still secure interactions in Trust Circles with great performance and usability. Once more, it also offers free transactions (or other monetisation shapes that are different from simple Eth pay-as-you-go, like monthly subscriptions, caps, etc.) are possible to implement in an Avalanchain network.

We decided not to ignore those facts and instead make a better use of them. Avalanchain networks benefit from splitting and controlling read and write access to the chain via Trust Circles and Functionally Nested chains. Each of those is optimised to deal with the smaller number of concurrent writes naturally and as a WHO DO YOU CALL? result is using a simple consensus mechanism. The first question any responsible manager usually asks before approvMESSAGE FORMAT, CONSENSUS AND ing a new IT system for production FEES use is â&#x20AC;&#x153;who shall I call if things go Data communication and data formats are cur- terribly wrong?â&#x20AC;? rently split into machine (binary) and humanly readable. JSON is the current de-facto stand- In the case of a centralized system ard for the later. It is perfectly supported by all the answer is obvious â&#x20AC;&#x201C; call the software platforms and stacks. More than that, 1st/2nd/3rd level support, wake there is a signed messages format called JWT them up if necessary, and let them (Json Web Tokens) which allows inter-platform deal with the issue. But in the case communication with cryptographically signed of a fully decentralized system this Json data. option is not easily available, as decentralization assumes differFor smaller groups of distributed writers in ent parts of the system to be consubnetworks established Proof of Stake algo- trolled by different entities from

a support perspective, with unavoidably required coordination between them, for system integrity level actions. Hard forks on Ethereum and the fork of Bitcoin have clearly shown a necessity to have platform support for graceful node upgrades and soft message format versioning. We deal with this issue by reinventing the concept of Network Administrators in a decentralised and semi-centralised manner, additionally supporting message versioning on the protocol layer. That allows nodes to only talk to the messages on chains they both support. The very same applies to the Circles. Additionally, the embedded concept of message-based Bi-Temporality allows Users and/or Administrators to apply logical corrections to practically unavoidable issues in audited history, in a graceful and controlled manner without braking consistency together with an all-the -waythrough audit provided by the chain approach. CONCLUSION In summary, Avalanchain is a Next Generation Blockchain platform built on fundamental streamed data processing principles targeting a hybrid approach in interoperability between public and private enterprise chains, bringing together the better of two worlds. 31

SEPTEMBER 2017

Ewaste.io

Getting Some of That Value Back from Your Old Electronics How do we bring sustainability to E waste? How do we ensure rare earth and other scarce elements used in modern electronic devices we take for granted are available for our children? This is a very important issue not being addressed by anyone! Except for now.

by JITESH VARSANI Independent Shipping, Chartering and International Trade Consultant

Imagine a world where you can get back some value from the electronic device you purchased a few years back? Or if you are a manufacturer, get back your old product for recycling, providing feedstock for your new technology, a fully circular life cycle. Or a trader / processor engaged in the E waste market buying and selling materials internationally simplifying this down to the push of a button, being able to take care of all the previously complex time-consuming tasks involved in physical trading i.e. counterparty risk, shipping, banking, customs both ends, taxes, currency movements and not to forget the highly skilled staff. E Waste coin is a cryptographic blockchain based technology. This will be the rock that provides stability throughout your global procurement process. No more complex calculations involved with various currencies for accounting profit and loss and no more currency hedging. The online portal will allow full management of the crypto currency and E waste procurement and management, giving the user the ability to supercharge business processes. The online marketplace allows for forward contract buying and selling, history of purchase and sales and naturally all commercially sensitive data will be fully controlled from the user interface.

post it to a company that would repair, All functions executed via a smart consell and/or recycle. However, this com- tract priced in E Waste currency. The pany would pay you very little for the online platform "E waste exchange" will item in question. This payment will be contract directly with the shipping lines nowhere near a second-hand market to streamline container booking, effectively operating as an price for the device or NVOCC (Non-Vessel the various rare earth Owning Common CarFor investors that materials inside the rier), issuing its own device. All that value want to get involved shipping documents would be lost! Now, at the beginning this to streamline customs if you were to dispose clearance and propre ICO, email of the phone through vide competitive pricthe E Waste online ico@ewaste.io for ing for the freight elplatform, it would further details. ement of the sale, as know all the materipricing will be based als that the phone was on a pre-negotiated made from and pay you accordingly. This would be a para- COA (contract of affreightment) with digm shift from the current state of af- various shipping lines & trade routes. All consignments will be delivered on a DDP fairs. (Delivered Duty Paid) basis. Providing traceability and accountability to materials and business processes, The online platform will have several is the key feature in cutting through the layers of function, with a suite of apps ever-changing global regulatory envi- for each function: ronment. Having the ability â&#x20AC;˘ Driver app - employment for the "man with a van", infinitely scalable to trace providing on demand in house road logistics. â&#x20AC;˘ Processor app - providing employment / materials for manual sorting and logging onto the system. Once inventoried and uploaded onto the exchange, the materials are available for purchase. Once a sale is executed, a container will arrive at the processor's location; the processor will be fully instructed on packaging and presentation of E waste in the container, including inspection and labelling.

the location of any E waste item in the real world, will allow data on this grey market to be compiled, leading to concrete figures on the amounts of various rare earth and scarce elements â&#x20AC;˘ E Waste database app - providing a comprehensive database of all E aboveground and in use. Thus, leading waste items including detailed inforto a solid market platform & transparmation on the material makeup of ent price discovery. the device in question, freely accessible via a trading account. It can also UBERIZING THE SUPPLY CHAIN be available as a paid service for re- Local Collection / Transport searchers, businesses, universities WHO SHOULD GET INVOLVED? - Local Sorting / Storage / Inspection / and governments (Naturally, all will Well, currently (in the UK) if I wanted Container stuffing be paid in E waste coin). to dispose an old mobile phone I could - Shipping 32

Snip

SEPTEMBER 2017

The Future of News Will Come from The Blockchain The Internet has profoundly changed the news industry. In the past, local and national publishers enjoyed a monopoly on the distribution of information, providing them with a strong hold on reader’s attention. This, in turn, provided them with a constant stream of revenue from advertisers. The barriers to entry for new publishers were high, requiring them to have enough capital to buy or rent printing presses. In the Internet age, everyone can start a news outlet in a single click and the monopoly on news is dead. by RAN REICHMAN Snip CEO

The Internet also brought another important revolution - the rise of user-gen- Ad-based outlets are dying, unsuccesserated content. Instead of readers hop- fully competing with Google and Faceing to get a column published in a known book’s hold on people’s attention. In newspaper, anyone 2016, the two giants can create a website collected 99% (!) of the and broadcast their growth in ad revenue, ICO scheduled for thoughts to the world, leaving only crumbs September 2017 on Medium, Facebook, for the rest of the news or their own website. industry. And they’re continuing to grow Most news outlets were unand take larger portions of ad able to create content good budgets. enough to compete in this new age, and to stay in busiThe news industry needs a ness, pivoted to entertainnew model, and that’s where ment (quizzes like “Which Snip comes in. Snip is a new Harry Potter character are The content on type of news platform, deyou?”), clickbait articles centralized and powered by (“You’ll never believe how Snip is personal- the community. On Snip, anthis girl ...”), and provocative ized for each user yone can write a news stoop-eds (“This scandal shows using an openry about any topic and readeverything that’s wrong source newsfeed ers can find news that matters with...”). Users don’t value to them. Contributors are realgorithm, and this kind of content and most warded with tokens accordof them don’t develop loyal- users can choose ing to the popularity of their ty to news brands who pub- their own algoposts and comments, incenlish it, but the entertainment rithm. tivizing them to create great and outrage drive user traffic, content. A community-based providing enough ad revenue to keep the news site, owned by the community, can publishers alive. become the top news destination for hundreds of millions of people and covHigh-quality newspapers and magazines er any subject, from breaking news to enstill exist today, but those are gradual- tertainment and everything in between. ly pivoting towards subscription-based content, inherently limiting their report- The content on Snip is personalized for ing to a small group of affluent readers. each user using an open-source newsfeed

algorithm, and users can choose their own algorithm. Since people prefer reading short and concise stories, the default algorithm assigns higher value to short content. Readers will also be able to subscribe to writers that they value, tip them, or even purchase a paid subscription to their content. Snip’s belief is that there shouldn’t be a single arbiter of the truth and that relying on content selected by the mainstream media is a form of censorship. Snip content is not censored and is stored in a decentralized manner, using the IPFS protocol. Users will choose their own trusted content filters, allowing them to ignore specific words or sources of content, but any legal content meeting basic community standards (e.g. not spam) will be allowed to stay on the platform. Snip caught on quickly, and within months reached 25,000 active users and 1,400 paying subscribers. People were constantly asking to add more and more topics to the platform and cover more of what’s going on. That’s exactly Snip 2.0 the Snip platform and token. On Snip 2.0 anyone will be able to write a news story, allowing the platform to cover anything that’s going on in the world. Using blockchain technology that didn’t exist several years ago, news will now have a new and exciting business model, allowing it to thrive once again. 33

SEPTEMBER 2017

Fractional.io Fractional Ownership and Value Creation in a Shared Economy

The crypto space has seen an explosion in recent years and the value of those cryptocurrencies and crypto based assets have seen huge swings in volatility, which has led to increased risks, until now.

by MIKE KESSLER Managing Director at Kession and PCO rentals

Fractional.io now gives investors an opportunity to participate in the first of its kind platform. Fractional will allow investors of any size to own fractions of an existing fleet of electric, hybrid and Wheelchair Access Vehicles (WAVs), currently in use by UBER drivers on the streets of London, Manchester, Leeds, Liverpool and Newcastle. The ownership of these real world and currently utilised (on rent) assets will enable investors to diversify their portfolio with income generating vehicles. UBER has become synonymous with high growth and disruptive technologies and the lifeblood of the UBER business as well as other ride sharing apps is the vehicles and the drivers. Fractional is developing an asset based

platform, that allows crypto investors access to the platform, as well as providing fractional ownership in the underlying assets. Fractional will develop smart contracts on the Ethereum Blockchain, to validate the ownership of the vehicles and the blockchain technology will drive the rental system, as well as providing a ledger of ownership. As the platform develops, other asset providers will be invited onto the platform to drive the sharing economy. As UBER'S first UK based supplier of vehicles to their partner drivers, Fractional already has a fleet of over 350 vehicles that are currently being utilised on the UBER Marketplace. Not only does this provide a hedge against the volatility in the cryp-

SEPTEMBER 2017

distributed via the DLT Blockchain framework, to enable ownership of the assets. These smart contracts will effectively act as a certificate representing a portion of the asset base. As the asset base increases, the blockchain technology along with the smart contracts, will allow each new asset to be subdivided between the respective token holders and allocated to each token holder individually. The assets then produce a monetary return through rental, insurance claims, telematics etc. These returns are then apportioned via the smart contracts to the token holders, which as the asset pool grows and as ride sharing apps expand, will lead to an increase in the value of the tokens (as token holders will own more assets) as well as creating a substantive return, much like renting out your timeshare to someone who wants to use it for a holiday. Fractional is working with Green Wheels LLP, which has been trading with UBER drivers since 2012 when UBER first came to the UK, and was established in 2008 before the ride sharing economy began. The business has always been at the forefront of the industry allowing it the ability to spot trends, it was the first company in the UK to work with UBER. It has built an established highly profitable business and has shown consistent revenues and growth. Owning hundreds of vehicles has given the business the ability to leverage off its position in the marketplace and has ambitions to grow further throughout the UK and then expand throughout the globe, to provide fractional ownership in the vehicles to token holders. By always being at the forefront of emerging technologies and spotting the trends, Fractional, together with Green Wheels, is uniquely placed to bring real performing assets to the crypto world through shared/fractional ownership.

to markets, it provides access to a growing community of shared ownership, backed by physical assets.

Fractional will allow investors of any size to own fractions of an existing fleet of electric, hybrid and Wheelchair Access Vehicles (WAVs), currently in use by UBER drivers on the streets of London, Manchester, Leeds, Liverpool and Newcastle.

Self-executing smart contracts based on Ethereum, will confirm the contracts and the investor will receive Asset tokens that represent fractional ownership of the vehicles. The tokenisation of the assets will allow them to become tradeable and enables access to one of UBERâ&#x20AC;&#x2122;s most successful markets globally (the UK). For the assets to be acquired, we will use the smart contracts to create trustless transactions between the parties. In the same way as a property timeshare is split amongst the owners, so will be the case with the vehicles themselves. The Fractional ownership will be subdivided amongst all the token holders, and then

Not only will Fractional develop a blockchain driven platform for its current assets, it will expand the asset base and create pools of vehicles available to different groups on a membership based system. Car dealerships and leasing companies are sitting on assets that they are unable to utilise and deploy. By creating a tokenised based car usage system as well as an asset ownership system, investors will ensure that they have a perfect symbiotic hedge between ownership and an exchange for car usage, making this concept future proof as the ride sharing economy evolves and autonomous vehicles start to replace traditional vehicles. Fractional will provide the assets to the ride sharing economy app based users. UBER will continue to direct the cars and offer a point to point service and Green Wheels along with Fractional.io will provide the vehicles to UBER (and others) to access their app for passenger transportation purposes. UBER is looking to remain in the technology sector. This places us in a perfect position to ensure that the business model is future proof, as autonomous vehicles progress into the mainstream you can own part of the fleet that drives passengers in the autonomous vehicle revolution. 35

SEPTEMBER 2017

SocialCash

The Next Big “Unlock” For Social Media SOCIAL SHARING ECONOMY - WEB 3.0 (INTERNET OF VALUE) Social sharing of information creates economic value. Social media and the Internet have made it possible to exchange information at a rate that has never been seen before. This exchange by PAUL TAYLOR of information is increasing at an expoCEO SocialCash nential rate through sites like Facebook, Twitter, Instagram, Pinterest, Snapchat and more. “Yet, not everyone is profiting equally from it”. 36

ALGORITHMS – THE SOCIOECONOMIC GAP WIDENS Content hosting services, social media giants and advertising intermediaries are hoarding huge sums of the revenue by adding algorithms that limit your reach to your friends, followers and target market. Meanwhile the users (typically Gen Y and Gen Z) who create, curate and share the content take away little or nothing from the value they help create, effectively becoming cogs in the wheel of these tech giants.

PROBLEM - SOCIAL MEDIA “GATEKEEPERS” Social media intermediaries act more like “gatekeepers” rather than unlocking value between Advertiser and Users who share digital content. These platforms create complexities while profiting from these inefficiencies. This problem is magnified by the fact that most social sharers are part of a younger generation that are economically disadvantaged. Even though these younger generations are creating significant wealth through information sharing and con-

SEPTEMBER 2017

tent creation, they are not being economically rewarded for their efforts. “This is a societal epidemic of gross proportions”. SOCIALCASH - BLOCKCHAIN SOLUTION Enter SocialCash www.socialcash.io. SocialCash is a next-gen decentralized and distributed social sharing platform designed for the new Social Sharing Economy – Web 3.0 (Internet of Value). The platform enabled by blockchain technology can “stack on top” of existing social media platforms or function as an autonomous decentralized Facebook-type platform. PATENTED SOLUTION SocialCash uses a patented technology - “Tracking Network Data Propagation” US Patent Number 9,647,911 issued May 7, 2018 and U.S. Continuation Applications - applied to blockchain technology to directly monetize the benefits soers will purchase and Users will redeem Social cial sharing provides to economic growth. Coins directly through the SCX via their digital Sharing Digital Content creates value which wallets (Smart Wallets). is the new social currency of the Web 3.0 enabled by blockchain technology (US Pat SMART CONTRACT - PROOF OF SHARING (POS) 9,647,911). We introduce a new type of smart contract for unlocking value from the Social Sharing EconMISSION STATEMENT SocialCash mission is to unlock the latency omy (herein, “Social Contract”) which is based (value) that exists in social media by reward- on Proof-of-Sharing (PoS), for authenticating Users for creating and sharing digital con- ing Users that share or create digital content tent. SocialCoin technology is the “new unlock” on the blockchain. Social Coin is the reward for of the new Social Sharing Economy – Web 3.0. sharing and authentication on the blockchain using the Smart Contract. PROBLEMS WE SOLVE - ADVERTISERS Social Contracts can be applied across multiple AND CONSUMERS SocialCash blockchain technology solves the social media platforms and in multiple jurisdicproblems of reach, transparency and lack of ef- tions to reach national as well as international ficient markets that are destroying value for users, which makes them highly effective and modern advertisers using conventional plat- efficient in a decentralized model. form-based social media platforms. The Social Contract verifies users on the blockchain for ad- SOCIALCOIN INDUSTRY SPECIFIC vertisers and incentivizes new target market us- APPLICATIONS ers to join the blockchain, to share and optimize SocialCash can be directly applied to: marketing and pixeled retargeting campaigns. We solve this problem, not only for advertisers, but also for the supply chain comprising the platform-based social media companies. The technology provides a layer of risk management and audit for campaign metrics which is verified. WHY NOW Social Advertising is ripe with “online firewalls” propagated by “Pay-to-play” enterprises that control your ad spend reach with a click of code. Chatbots, AI and unverified sources are slowly building a deceitful model to be exploited by scammers. Sponsored Ads (promoted) are more and more costly, all the while becoming largely ignored by Consumers as untrusted. SOCIALCOIN - NEW CRYPTOCURRENCY OF WEB 3.0 Social Cash Exchange (SCX) is implemented as a universal trading platform for businesses related to social exchange. SCX deals take place with the use of smart contracts, while the transactions will accept a new type of cryptocurrency called a “Social Coin”. Advertis-

We introduce a new type of smart contract for unlocking value from the Social Sharing Economy (herein, “Social Contract”) which is based on Proof-ofSharing (PoS), for authenticating Users that share or create digital content on the blockchain.

2 Product (Ad) like’s and sharing for TV interactive and streaming (ott); 2 Music sharing (for profit or cause); and 2 Political Ad sharing. 2 TV Advertising (Current and future Interactive) - Traditional (linear) TV advertising relied on a polling and extrapolation (Nelson ratings) to determine the effective audience and demographics. The advent of online metrics and streaming media platforms has indicated that the traditional broadcast advertising is expensive and highly ineffective with large portions of the content being beamed to non-appropriate audience e.g. female products to a male audience. With the advent of targeted streaming advertising e.g. Sky’s Adsmart targeted advertising, advertisers will pay a premium for the targeting and resulting advertising analytics. In 2017 TV ad spending will total $72.01 billion only 35.8% of total media ad spending in the US. SocialCash solution allows for: 2 Targeted audiences to share a message amongst their peers - providing mutually rewarding feedback e.g. “liking” an online ad can be rewarded by the advertiser as well as provide meaningful analytics and means for the advertiser to remind the audience of the potential purchase without interrupting the streaming content flow. 2 Streaming content providers to compete more effectively for advertising spending. 2 Digital Music Advertising - Artists could leverage the opportunity with having their fans share their content on popular music streaming services like Spotify or Soundcloud and be rewarded in Social Coins. Social coins could be used to directly purchase new digital content in the form of music or video.

Even though these younger generations are creating significant wealth through information sharing and content creation, they are not being economically rewarded for their efforts. 2 Political Advertising - In 2016, political ad spending was projected to reach $11.4 billion, with $1 billion being spent on digital advertising on social media. 37

SEPTEMBER 2017

Wrisx

World’s Risks and Research on the Blockchain Wrisx is an innovative system tackling a problem relevant for major institutions as well as SMEs and individuals in emerging markets: the need for research of counterparty risks.

by DR VLADIMIR SHIPOV Wrisx founder

WRISX PLATFORM Led by Dr Vlad Shipov, an experienced fintech entrepreneur and founder of an international trade credit insurance broking firm based in London, the Wrisx project is building the world’s first risk and research platform powered by blockchain. It is preparing a token generation event soon, which will help complete the development of the platform as well as market it globally. The idea for an emerging markets research blockchain-based marketplace was borne out of observing a massive market gap. Wrisx team’s direct experience includes working for leading global institutions in the banking and insurance industry as well as setting up and running a credit insurance brokerage firm in London. There they have been witnessing firsthand how many projects from emerging markets are routinely declined by major insurers and FIs. This is often due to the lack of comfort and understanding by western-based institutions of emerging markets businesses as well as by the ratings-driven approach to portfolio management. Low country ratings assigned by a handful of western-based rating agencies act as ceilings for ratings of businesses in any country. This dramatically limits emerging market risk appetites of Basel III- and Solvency II-constrained financial institutions blindly following the rating agencies’ scoring. They are not equipped to do granular analysis

as rating agencies only cover a small spot of several concurrent significant fraction of emerging markets busi- trends we are seeing globally: nesses while also pe• Increasing adoption nalising them with of blockchain-based Pre-sale: Q3/Q4 very low ratings. technology in its various forms, Wrisx’s business inICO Scheduled for: • tremendous growth telligence tokens will of emerging markets 2017 Q4 / 2018 Q1 provide fuel to the with corresponding blockchain-agnostic growth in demand for system and lower the capital and risk serbarriers of entry to sourcing informa- vices, including infrastructure investtion on, and trading with, counterpar- ment, which represents another multies globally. ti-trillion-dollar gap, • Adoption of P2P models in various inTOKEN MECHANICS dustries, Wrisx enables independent parties to • Social impact, offer and source information services • The lack of flexibility and market rewith businesses large and small located sponsiveness of traditional sources of anywhere on the planet, able to access research and risk appetite and the expertise of independent analysts • Regulatory developments such as when they would like to research an exthe EU’s directive MIFID II, which isting, or potential counterparty or inwill force banks to unbundle their revestment target in any market. search from their brokerage services Wrisx is positioned right at the sweet as of January 2018.

SEPTEMBER 2017

Let’s consider these developments in detail. BLOCKCHAIN-TECH GROWTH Over the last several years we have witnessed a remarkable growth in community and start-up driven activities aimed at building business models powered by blockchain beyond its initial payment use cases. This has been mirrored by a flurry of initiatives to adopt blockchain tech by some of the world’s largest corporate and financial institutions: So far, these two groups of activities have been relatively isolated from each other, but we are starting to witness a new wave of blockchain development – the one where innovative business models are emerging, allowing for cooperation between the two worlds – one of major corporations and the other of SMEs and individuals globally. This convergence is a welcomed development for the whole ecosystem, as it should help enhance the mainstream user adoption of the crypto technology by realising the tangible benefits it can bring to many kinds of businesses.

BTC and ETH growth

With global trade estimated at US$100 trillion per year and a major and growing part done on credit terms whereby one party takes the risk of another party’s non-payment or non-performance, Wrisx fills an important gap – analysis of the counterparty’s ability to perform becomes extremely important for the two sides to come to an agreement on a transaction. Traditional sources of obtaining such information are very limited, expensive, outdated and difficult to access across the whole universe of emerging markets. EMERGING MARKETS GROWTH This lack of coverage is lagging behind the booming growth in SME and large business activity in many emerging markets, on the back of a great middle-class expansion. 525 million people in Asia alone are already middle class, which is more than the total population of Europe. Another three billion are expected to join middle class ranks in the next twenty years, coming almost exclusively from the emerging markets. CROWDSOURCED BLOCKCHAINBASED MODEL TO MITIGATE CROSS-BORDER RISKS As various crowd-sourced models have demonstrated (Airbnb, Kickstarter, Upwork, etc), p2p models offer massive growth potential. Crowd-sourced crypto-based markets represent an incredible opportunity for expertise and resources-sharing over traditional inadequately functioning markets. New blockchain-based systems can attract new sources of support while opening

Corporate adoption of blockchain technologies

Wrisx team’s direct experience includes working for leading global institutions in the banking and insurance industry as well as setting up and running a credit insurance brokerage firm in London.

expertise in new emerging market asset ally, will ultimately have to distribute classes to a wider audience of investors their analysts' research on online marfrom across the world. ketplace platforms. Alternative models including running an execution-onMASSIVE SOCIAL IMPACT ly brokerage that sources its research In addition to its positive impact on from independent providers, are being businesses, Wrisx is also fulfilling a explored by major users and producers beneficial function both for emerging of financial research even in developed markets and for western governments markets, meaning the Wrisx platform’s and societies. With easier ways of do- arrival is very well-timed with its value ing business through such platforms as both for emerging markets, but also deWrisx, entrepreneurship can jump-start veloped markets research users. in a meaningful way in many countries. More business development in emerg- Wrisx’s distributed blockchain-based ing markets, provides more quality em- application is a game-changer, for mitployment and business opportunities igating and researching risks of investto indigenous communities and their ing or lending to emerging and develyoung and active population. oped markets businesses, not adequately serviced by the current risk and capRESEARCH UNBUNDLING ital systems, while enabling more local EU’s Markets in Financial Instruments experts to offer their risk analysis serDirective II, an overhaul of trading vices to those requiring them. Wrisx’ rules set for implementation in Janu- distributed application and platform ary 2018, is set to 'unbundle' research helps bridge these gaps and ultimately and trade execution costs. Banks glob- facilitate global economic development. 39

SEPTEMBER 2017

GIFTZ™ $500k in a day doesn’t seem like much in the ICO world, but they aren’t selling tokens… they’re selling convertible notes, with a bonus “kicker” of tokens. Genius! If you've been waiting on the sidelines for a token sale that’s got chops, then this Pre-ICO may be the one for you.

Rewards Media is an existing Loyalty of a token will happen if consumers get Rewards business, has an A-List team, it FREE and don’t have to change their killer token application and a clever way behavior. Mr. Paukulis states, “Mass to get mass adopadoption and scartion. Best of all city drives token they are embracvalue. Bitcoin minKeep an eye out for ing the Blockchain ing has slowed by their ICO in Q4 2017. community and down and valAMETHYST ue has increased. PINES will accept BTC & ETH from accredWe’re going to ited investors Sept 15th-20th 2017 (see mirror that in the Giftz™ Loyalty Regiftz.io or www.crowdfunder.com/it- wards Ecosystem.” coin). THE PRODUCTS Rewards Media’s Giftz™ Network has A free global blockchain loyalty ecosysone of the best teams we’ve seen launch tem for consumers, merchants & devela Pre-ICO this year. It’s the brainchild opers: of seasoned entertainment executive; 1. GIFTZ™ (Global Blockchain Rewards John Paukulis, former Producer & DirecEcosystem) tor Digital Marketing at Paramount Pic- 2. ITCOIN® Silver Tokens (Tokens in tures and current CEO of Rewards MeThe Ecosystem) dia Inc., Televisa Family Investor; Emil- 3. ITCOIN® Gold Tokens (Public Toio Diez Barroso, and Linda Giambrone, kens Outside the Ecosystem) Head of Production NBC Primetime TV. 4. Mobile Waulit™ (Collect, Hold & All three are betting that mass adoption Spend Tokens)

SEPTEMBER 2017

PROBLEM: Standalone & Coalition Loyalty Rewards Programs are expensive and out of reach for most businesses. Best Buy spent $50M simply upgrading their rewards program. Loyalty is too expensive for most businesses. Cash back rewards are fragmented, unmanageable, get lost or are forgotten. As a result, over $16 Billion of rewards go unredeemed each year in the USA alone. Many state laws do not allow points to expire, so they sit as a liability on the balance sheet for the business and as unrealized cash value for the consumer.

Mr. Paukulis began his Loyalty Rewards Program as a token in 2013 when blockchain was unpopular. investors steered him back to standard points, but he kept the name itCoin® and built a wallet account viewer (Waulit™). Now those same investors are investing in his crowdfunded campaign. Paukulis; “Life has a way of coming around full circle if you wait long enough”. I continue to Imagine a world where businesses give away tokenized Giftz™ for customer engagement, like a free token for a beer at the ball game, or tokenized dumpling appetizer or diamond token that has value in a jewelry store.

The founders of Rewards Media, Inc. have already given away millions of dollars in incentives for market research surveys over the past 10 years. Their research data collection and pointdistribution methodology has been SOLUTION: The Giftz™ Team is developing perfected and there is no better team to With itCoin® you can earn it, trade it or redeem a FREE blockchain Rewards Ecosystem, Com- bring this exciting Giftz™ program to the it for cash or give your Giftz™ to a charity or mon Rewards Token & e-Wallet that will come blockchain. even reward your kids for doing their homewith a re-loadable Debit Cash Card (mobile & plastic). Businesses just pay for their "points" (tokens). By using a decentralized rewards network & common cryptocurrency, physical digital rewards can be distributed securely (B2C or peer-to-peer) and collected in a wallet. Businesses pre-buy our tokens (think of digital S&H Green Stamps) to reward customers, but because a physical rewards token is passed to the customer, liability does not stay on a balance sheet.

ERICK WENT; Matter Labs, Inc.

“Life has a way of coming around full circle if you wait long enough.”

work. “It” is peer-to-peer.

Serious investors or possible partners, come visit us at Crowd Invest Summit on September 6th 2017 Los Angeles Convention Center, 1201 South Figueroa Street, Los Angeles, CA 90015 and we’ll buy your two-day pass ($999 Value). Just reach out to Michael.Kaplan@rewards.media for your VIP CODE. Download Waulit™ - on Android or iOS app. 41

Pre-Sale and ICO

SEPTEMBER 2017

Boule

Remote Voting Technology Remote Voting is going to be available soon and blockchain is the technology that makes this possible. In fact, since the beginning of the millennium we have been experimenting with electronic solutions for elections, but the concerns about cyber-attacks and voters’ anonymity have slowed the innovation process to the point where France has stopped its electronic voting system.

by CLAUDIO PERLINI Wrisx founder

It's time to act; it's time to use blockchain not only for speculative greedy purposes but also for the benefit of society. We are overwhelmed by the representatives we choose. Once we express our vote, we don't have any control over their decisions. For this reason, many people prefer not to vote because they believe nothing can change. Unfortunately, a lower number of voters makes it easier to rig the election.

It’s time to act; it’s time to use blockchain not only for speculative greedy purposes but also for the benefit of society.

project and everyone becomes a piece of the puzzle that we need to achieve this mission. More than 1000 people around the world have asked to participate in our crowd sale on the 28th of August and we hope everyone will get a slot and be able to join the revolution.

al topics, as well as national elections. The first demo will be delivered in October, and we'll reward early users with our Boulé token every time they vote. In November, we'll test the first national election with the Spanish Government and the Scientific Institute of eGovernment as our main partner.

There is something that the recent North African revolutions have shown Remote Voting TechnoloSomething bold is happenus: if people act altogether, even the gy is not only a technical ising in the world, it is a piece mightiest dictatorships can be defeated. sue, we must seriously consider how people will interact of the Crypto-revolution that entrepreneurs like me and So, in a connected world, we just have with a remote voting system; you and investors like you to set the new rules for direct democra- will they make simple choicand us are creating. cy and technology will provide us with es due to their laziness, or the right tools to manage it. These tools will they feel more commit- We have identited and make more informed fied Blockchain Let us contemplate for a secmust be reliable, secure and cheap. decisions? ond: as the leading • How would your city or naWe have identified Blockchain as the As a founding team, we don't tion be if you had the powleading technology for a remote voting only have to develop a vot- technology for er to judge right and wrong system because it is anonymous, secure, ing system, but we also have a remote voting and make your electoral powimmutable and cheap enough to be a to consider sociologic, ethics system because count? substitute for the offline voting process and the behavioural aspects. it is anonymous, er • Would you have the same we are all used to, also: As entrepreneurs, it's essen- secure, immuta- unemployment rate or would • It will be easier to count votes back; tial to create value in a world ble and cheap you work on that issue bet• It will be 20 times more convenient; ter? • It will be hacker-proof, if it is hack- overwhelmed by useless enough to be a • Would you prefer private iner-friendly (bounty programs are the products and hasty decisions. substitute for We must also consider the clicome instead of public health? best way to prevent hacker attacks). mate impact, disparities and the offline voting • Gasoline or electricity? process we are all • Politicians electoral reimFor now, people are concerned with on- illuminated governance. bursement or a higher educaline voting, because they don't know used to. tion budget? the potential of blockchain. Our mis- On that point, we are making sion in the next few years will be to de- a big leap forward to tackle the abuse in velop, empower and promote the tech- the management of societies; there is As someone said a decade ago, “yes, we nology, as well as to communicate how no doubt, that most people have felt the can!” We can do it now, by empowering straightforward and reliable it is to vote desire to do the same, at least once in our voice and recognizing the minority their life. voice, in a symbiosis of ideas, beliefs, reonline using this technology. ligions and identities. A huge community of supporters and To do that, we are developing a unientrepreneurs is growing around this versal voting platform to vote on glob- From the people to the people. 44

DomRaider

SEPTEMBER 2017

The pro-blockchain European leader in Drop Catching DomRaider aspires to develop an opensource solution dedicated to real-time management of auctions, based on blockchain technology. DomRaider, A French hypergrowth startup, has become the European market leader for auctioning of expired domain names, they are announcing the launch of the ICO via a website dedicated to the process: www.domraider.io. by ICO CROWD

Thanks to funds collected from its ICO, DomRaider will be able to accelerate its development on an international scale, which is already marked by its presence in Italy and Sweden and will be expanding to Canada and the U.K. from October.

REAL-TIME AUCTIONS CARRIED more than 33 employees spread over OUT ON THE BLOCKCHAIN three countries (France, Sweden and ItaAfter an amazing 12-year adventure as ly) to which Canada and the U.K. will be the head of Prizee (one of the first suc- added in October. cessful web startups in France) Tristan The entire innovation of the project will be Colombet created DomRaider during the HOW DOES THE PROJECT CREATE VALUE TO THE ECOSYSTEM concentrated on the core of the blockchain, summer of 2013. AND DIFFER FROM COMPETING a structure of data chained together in a decentralized network. In fact, DomRaid- DomRaider is a service for recovering ex- PROJECTS? er aspires to revolutionize the previous- pired domain names or “drop catching”. Auctions organized by DomRaider will ly relatively limited auctioning ecosystem Thanks to precise indicators and tech- be the first to migrate onto the blockby using blockchain technology. The fixed nology that detects the availability of do- chain network. Strategic acquisitions carobjective is to develop the first decentral- main names the second they become so, ried out thanks to the ICO will accelerate ized network, dedicated to real-time man- the company identifies the domain names other player’s involvement and will enable its development. The agement of any auction in the world, either whose potential is of genuine benefit to DomRaider ICO comonline or in the auctioning room. ICO Start Date: their clients. The exbines 4 key factors for pired domain names its success. InnovaSeptember 12, 2017 This solution is aimed to be: tion of ground-break• Scalable, reliable and transparent (pub- can therefore be used ICO End Date: ing technology by lically verifiable auctions that are im- in the context of refOctober 11, 2017 erencing strategies blockchain experts. possible to falsify) Maturity of an al• Communal and interoperable (world- (SEO), speculation on Pre-Sale is Live ready well-established wide auctions accessible through gener- rare domain names or management of intelcompany and an exic interfaces) • Fast (consensus of bids in less than 1 lectual property. With more than 20,000 perienced team. Not just a concept, but a transactions since its creation, DomRaid- solid roadmap and set-up plan. A compasecond) • Financially advantageous (very low er is today the European leader and cur- ny in compliance with French legislation rently offers 27 extensions including .com whose accounts are audited by KPMG transaction costs) that is opening doors to the worldwide ABOUT DOMRAIDER ICO “We are very enthusiastic about the idea market. The ICO starts on September 12, 2017 of launching the first ICO carried out by a French company that has proved itself As of now, DomRaider has raised 3.5 mil- and ends on October 11, 2017. As such, and has been running for 4 years. It is an lion euros since October 2016, with an in- the company will issue close to 1 billion important springboard for the develop- itial round of 2 million euros from the Eef- tokens in “DomRaider tokens”. Reservament of DomRaider, and it fully illustrates ficiency investment fund, followed by a tion (pre-sale) is now open to everyone via the emergence of the blockchain with- second round of 1.5 million euros in May the dedicated website: www.domraider.io. in the real economy. Through this ICO, 2017 from Crédit Agricole, CIC, Banque Less than one week after the start of the we would like to take advantage of this Populaire and BPI France. process, 130 million tokens (out of the technological revolution to transform the auctioning sector” explains Tristan Co- The strong growth registered by Dom- maximum of 262.5 million planned for lombet, CEO and founder of DomRaider. Raider enables the company to employ the pre-sale) have been sold. 45

SEPTEMBER 2017

Crowdsourcing by PRIYABRATA DASH Blogger, Crypto Currency Enthusiast, Entrepreneur

BACKGROUND The recent SEC ruling and the DAO investigation has put the issue of accountability and investor risks in ICOs onto center stage. Lot of questions were raised on the way ICOs were raising millions of dollars without any regulation or checks in place. While many questioned the whole process of the way in which some ICOs with a mere whitepaper and an idea outline were raising millions. There were many who voiced the need for a credible review mechanism for ICOs based on some established parameters involving their qualitative/ quantitative assessment and investment value. INTRODUCTION While checking out ethtrader subreddit I came across a post that talked about developing a crowdsourced initiative for reviewing and scoring ICOs based on a checklist of key points discussed and secured from the community. This initiative is not only commendable but also shows a very important aspect of why there should be community participation in reviewing and giving qualitative feedback on ICOs. While some ICOs have come up on the promise of prediction markets, but still there is a great need for community initiative where not only the ICO review and scoring is crowdsourced but also what points that

need to be included in the review pro- They try to highlight only the PR note cess are vetted and developed based on that is either present in the website or consensus. in the whitepaper. And with more and more people doing ICO analysis and reCURRENT SCENARIO views it looks to be more of a ICO proOF ICO REVIEWS motion than really being a construcThere are many avenues for people and tive review process. Also, it can be realwebsites reviewing/analyzing and proly confusing with so many perspectives viding their opinions about ICOs and thrown around about an ICO to the pubwith that, they help provide crypto in- lic. And at some point, such reviews bevestors with a quick understanding come non-constructive as again an inabout the ICOâ&#x20AC;&#x2122;s value proposition and vestor has to do his own research or just risks and why it may be a good invest- follow the FOMO while investing. ment. But I see more and more commercialization of this process is happening. NEED OF SOCIAL REVIEW OF ICO While there are paid reports which can ICOs are increasingly turning to boun- give an indicator about which ICOs you ty hunters who for Token rewards or a can invest, the parameters on which the share in the ICO tend to do reviews or analysis is done or the basis of the pregloss over the gaps and shortcomings diction is not always what you as an inin the ICO and in its value proposition. vestor would want. And hence a social review process for accessing and analyzing ICOs is commendable. First getting feedback from experienced ICO investors could help new comers, and bringing various perspectives to the table will help foster much needed debate and participation in ICO review processes. Over the time with scams and hacks In this instance users in ethtrader leverbecoming an alarming phenomenon aged Social Media and Messaging platforms like Reddit, Slack and Google of ICOs, many of the users wantDocs to collaborate and share their view ed more accountability on behalf of point and collected feedback as to what founders and security was a major parameters to be included and how to concern while running an ICO. develop the whole process from an idea

SEPTEMBER 2017

of ICO Reviews stage to a more robust framework. For me this of the tokens in the platform and also as a was genesis of a very wonderful initiative. At value to the investors? the end of the day any decentralized initative can only be supported when it is crowdsourced PROJECT GOVERNANCE & COMMUNITY and supported by a community. And in this PARTICIPATION context the users of ethrader subreddit were • Does the project have community participathe key contributors. tion aspect and built-in governance, project decision-making for the token holders? KEY PARAMETERS ADDED BY THE • Is there a vesting or escrow mechanism in COMMUNITY REVIEW place either via a third party or via smart Over the time with scams and hacks becomcontracts for the founders to release funds? ing an alarming phenomenon of ICOs, many • Is the project managed by a company or by a of the users wanted more accountability on befoundation, how much fund allocation is to half of founders and security was a major conthe company and how much influence will the cern while running an ICO. Here are some of company have over the ICO and the project? the points that people wanted to be included in the overall ICO review process. CROWD FUNDING & ICO PROCESS • How is the budget handling of the funds genVALUE PROPOSITION & TECHNOLOGY erated out of the crowdsale? • How much functionality of the ICO project • How are the funds managed, either via smart platform leverages blockchain or smart concontract or in cold storage or in fiat and what tract functionality? is the governance structure for managing the • Has the company documented their concept, funds? Are there any caretakers and is mulplatform roadmap in a whitepaper and how ti-sig used for managing the funds? much qualitative information they have pub- • How are the funds liquidated? How is the lished viz a viz the functionality, their value team vested for long term development of proposition, technology and platform? the project and are the reimbursement of • Do they have a product either in prototype or funds for the project milestone based and proof of concept and if it is open source how who is monitoring it? And who is held acis the activity in their github repo? countable? • Does their marketing message align with • If in case a large amount is raised via crowdthe details given in their whitepaper and dosale, is any maximum cap set for how much main? an investor can contribute and what would • How unique is their idea and how well is be the influence of bigger contributors to the their tokenomics with respect to the usage direction of the project?

SECURITY • Have all security aspects been taken into consideration and has the security audit of the website, tokensale process and the smart contracts been done via a 3rd party? • Is there a clearly defined designated round of audits in the roadmap from a reputable blockchain company or blockchain security entity? • Has a bug bounty been established to incentivize the discovery of exploits and bugs? ROADMAP & FUNDING TARGETS • Is this cap reasonable with the goals they want to achieve? Is it congruent with their budget plan? • Do they have clear and specific milestones in their roadmap and are the milestones and budget allocation viable? • Is the budget allocation of funds making sense and are the amounts reasonable figures? • Is there an outlined compensation plan for employees that is reasonable? • Does the company have well-reasoned cash flow projections (when will they start making money)? LEGAL • Has the company provided key legal issues and legal risk to token holders or other actors? • Does the project have an identifiable legal representation in their core team or advisers? TEAM • Are the team members within the project reputable? 47

SEPTEMBER 2017

• Have they been active in the blockchain community? • Does the team have a history of successful previous projects and/or pedigree? • Is the team present and responsive in prominent communications channels: Slack/ Subreddit/Website/podcasts/etc? • Does the team currently have the core staff it needs (i.e. solidity developers, marketers, legal, community managers, etc.) to carry out this project or does it need to make substantial additions? • What kind of value do the advisers bring to their project or ICO and do they have a vested (token) interest in project success? • Does the project have partnerships and great industry support which reflects in their possible success? • Do they have proven advisory members and how reputed are they in Crypto currency & the Blockchain industry? Views in support and against such an exercise: There was a lot of interest and support for this review process and the template. And many from the ethtrade subreddit participated in the process. And many constructive and divergent views also came out from these discussions.

ed, if there is a community feedback/refund mechanism and escrow process is followed to control the fund disbursed based on meeting the key milestones.

There was some skepticism on the whole review process though where some people raised question if this will bring more centralism to a decentralized form of raising funds and there will be few elites who based on reputation of team & industry endorsement will get the larger pie of the funding and other lesser known ICOs will be left out. There was also fear that this will CONCLUSION bring in centralism and people with their own While the idea of a crowd sourcing ICO remotives may influence the review parameters. view and assessment scoring is a very good and much needed idea, the call for tightly regulatThere was also the overshadow of the SEC ruling ICOs shows the underlying issue; we may ing, while some welcomed the move, there risk going from a utopian yet imperfect, unregwere many views who saw it coming given the ulated, publicly determined market to a regulated, managed, protectionist market that's there to protect people from themselves. Although, per vision of Satoshi Nakamoto, this was essentially just like the system the blockchain has been trying to replace. So, a good question to ask: How to develop a trust-less ICO review system that is decentralized, deWhile some supported the importance of pendable and based on Blockchain?

a whitepaper, others wanted to factor in the product development and the reputaWhile some supported the importance of a tion of the team and the viability of the whitepaper, others wanted to factor in the product development and the reputation of the idea itself. team and the viability of the idea itself. Others wanted to bring in more accountability in the way the funding allocation to the team is vest48

way some ICOs were raising huge amounts of capital without even a proper roadmap or accountability mechanism to the investors and stressed on the need of self-regulation on behalf of the crypto community and ICOs. Also, people stressed on the need of security audits and more robust mechanisms to make sure the recent incidents of hacks and phishing attacks are controlled and the ICO process is made safer for the investors and the capital raised is not robbed.

REFERENCE https://www.reddit.com/r/ethtrader/comments/6pnshq/last_week_you_guys_wanted_to_ implement_a_review/ htt p s: / / n p. re d d i t . com / r / e tht ra d e r / com ments/6o0om9/upvote_if_you_think_ethtrader_ should_create_a/

SEPTEMBER 2017

Investing in Real Estate with Blockchain Technologies Real Estate has been historically considered the best way to preserve wealth. However, Real Estate transactions today present significant inefficiencies such as a lack of liquidity.

by ENRIQUE DUBOIS REAL Co-Founder & CEO

REAL (Real Estate Asset Ledger) team is applying Blockchain technologies to the world of Real Estate investment in order to solve those issues. REAL is an Ethereum Smart-Contracts governed ecosystem that focuses on creating the best conditions for Real Estate investment bringing optimum price discovery mechanisms, transaction efficiency, transparency and lars into the U.S. market in the last 5 kens), generating profits paid in cryptoliquidity under a unified crowdfunding years (both commercial and residen- currency like Ether or similar. platform. tial). This investment is set to double in the next 5 years.” In all likelihood, a cer- REAL will offer simple and transparent It will offer an effective method of invest- tain amount of these investment funds property investments that remove the ing and securing the value of the existing will find their way into alternative fund- uncertainties usually faced by small inves50-100 Billion USD equivalent in crypto- ing options such as tors and enabling currency into the less volatile and grow- Real Estate Crowdvirtually anybody ing Real Estate market by generating rent- funding as forto build a property al income and value appreciation. eign investment based investment expands in the portfolio that delivth In November this year, a full fledged site U.S. Experts beers predictable and will be launched leveraging the Crowd- lieve this tendenconsistent returns. funding formula, where any user will be cy towards growth We believe in diverable to invest in a fraction of a Real Es- is largely due to sifying investments st tate asset with REAL Tokens, gaining worldwide ecoand therefore we profit rights (rental income+value appre- nomic uncertainty will offer a range of ciation) awarded by a smart contract and and foreign invesproducts with varpaid with Ether. tors seeking new ying levels of risk destinations for REAL is an Ethereum Smartand reward for usREAL ESTATE CROWDFUNDING their investments. Contracts governed ecosystem ers to invest in. that focuses on creating the “Real estate crowdfunding continues to be a dynamic and ever-evolving industry, Thanks to our best conditions for Real Estate On our Crowdfundgrowing to an estimated $3.5 billion in Crowdfunding site, investment bringing optimum ing site www.real. 2016. By 2025, the crowdfunding indus- people from all price discovery mechanisms, markets, REAL Totry as a whole is anticipated to be valued over the world will transaction efficiency, transparency kens will constitute at more than $300 billion and online real benefit from Real economic rights and liquidity under a unified estate marketplaces are primed to capital- Estate profit poof a property and crowdfunding platform. ize on that explosive growth.” (Forbes) tential worldwide will be backed by while performing physical Real EsREAL team believes that one of the most transactions with tate. Our users will impactful and exciting applications of ease. We are confident that a Real Estate also be able to trade their investments on Blockchain technologies will be within the Crowdfunding platform that uses Block- our platform, turning Real Estate investReal Estate market, especially within the chain and cryptocurrency will revolution- ments into liquid investments Crowdfunding space. The use of Block- ize the market. chain technology in the field of Real EsTHE TEAM tate Crowdfunding has the potential to THE CROWDFUNDING PLATFORM REAL Founders, Enrique Dubois and completely revolutionize the sector, giv- We are combining two of the most recent Bernardo Hernández, have invested ing greater access to investment in global disruptions in the online world: Real Es- $350.000 in the company, have a strong Real Estate, lowering barriers to entry and tate Crowdfunding and Blockchain tech- successful execution track-record and increasing market liquidity. nology. As a result, we are inventing a reputation, have founded and exited onwhole new way to invest. We will offer an- line startups for over +200 MM€ over the According to The Guardian, a recent U.S. yone from any part of the world invest- last 20 years and have held executive poReal Estate study showed that “Chinese ment in Real Estate assets using cryp- sitions at Google, Yahoo and top Venture investors have poured $110 billion dol- tocurrency (transformed into REAL To- Capital firms in Europe.

ICO Pre-sale: 24 August Start: 31 August

SEPTEMBER 2017

ICOFILTER.ORG The Dapp-Based Community That Curates ICOs

ICOFilter.org is a not-for-profit Dapp built on Ethereum. It’s bringing clarity and organi-zation to ICOs. The Dapp is wielded by a growing community that votes on cryptocur-rency offerings and puts order, ratings and funding to the space. The community drives it all…

by DAVID MURRY Blockchain and Smart Contract Strategist

The community makes decisions on which offerings receive funding to bolster their chances. The tokens are supplied by ICO Filter (the foundation) but is not determined by them, the decentralized community does the work and makes the designations. A big reason for the opportunity has to do with, the lack of settled regulation. Private regulation always comes first, though it is not normally thought of in this way. Public regulation – what we think of when we usually consider “regulation” – comes later from the government. Government regulations often make simple transactions more comp-

li-cated. In fact, there is a good deal of munity can see whether similar offercynicism about public – government – ings by the same people have turned regulation. out negatively. The community will no doubt rate them poorly. Serial coin Korea recently began considering ways fraudsters may be rendered irrel-evant to legalize bitcoin within a mainstream without an overabundance of formal context. Meanwhile, in America, it looks regulation. as if the integration will fall to the SEC. Recent results show that cryptocurren- ICO FILTER OPERATIONS cy trading have soared in Korea while There are other reasons why ICO Filter staying fairly flat in Amer-ica – and Can- wants to encourage community-style ada too. People are corpora-tions and more enthused partnerships. The about laws that Internet increaspre-ICO launch state their puringly supports loSept 14th pose clearly, than cal, tribal cultures. they are about The community what is all too often open-ended gov- culture may be physical in nature. More ernment regulation. likely digital now, with people at-tracted by similar interests and eventually by ICO Filter, through the community, not business possibilities. only takes the place of some public regulation, it also helps like-minded indi- The community consensus itself curates viduals innovate and support beneficial, and galvanizes top resources. First, prodisruptive blockchain solutions. files of companies are created. Then organization, verification and voting takes Investors may put money into bad and place. Some firms, primary disruptors, even fraudulent offerings. But the com- will receive token incentives.

SEPTEMBER 2017

Korea recently began considering ways to legalize bitcoin within a mainstream context. Meanwhile, in America, it looks as if the integration will fall to the SEC. Recent results show that cryptocurrency trading have soared in Korea while staying fairly flat in Amer-ica â&#x20AC;&#x201C; and Canada too. Community members now will be able to unite and organize. They build a movement focusing on private solutions. What ideas will get funded? .Over the next years, the reality of Internet 2.0 will begin to show itself. Blockchain and cryptocurrencies are gradually eliminating middle men.

ICO Filter will unite like-minded passionate people with common goals. Systems will gradually become standardized and sustain specialization. Powerful regtech solutions must transfigure offices and support changes without constantly developing software. It is a means to educate the population coming into the crypto space about the best to-kens. Some are only floated for a quick buck and will do considerable damage to new-comers and the marketplace. Our community driven process will identify and document both the good and bad ones. Community members now will be able to unite and organize. They build a movement focusing on private solutions. What ideas will get funded? Those determined the best by community consensus. In order to put forward a new idea for disruption, the community member needs to comment and curate on others in a similar industry, building reputa-tion. That is how they become eligible and move up the board. ICO Filter is an application as well as a free platform. Companies need third-party veri-fication using automated KYC. Various elements influence the decision to provide cov-erage, but the community is the ultimate arbitrator. ICO FILTER INDEX AND NEWS An ICO token offers a much-needed reference point. The Index measures the

perfor-mance of larger-cap cryptocurrencies and is regularly updated. Changes are made as necessary and company announcements are made to the public. The ICO Filter community seeks companies that are disrupting the regular order. Dis-ruption creates freedom. Countries may get smaller thanks to disruption. Blockchain and cryptocurrencies both provide disruption. Over the next years, the reality of Internet 2.0 will begin to show itself. Blockchain and cryptocurrencies are gradually eliminating middle men. Corporate communities, digital or otherwise, are reshaping large companies. They are natural substitutes for over-large corporations. These groups are taking their place, both digital and physical. Blockchain will give people more control. It will allow them to be more thoroughly in charge of their own data and actions. The community itself ends up with increasing control.

ly 5000%. Yet in 2015, ICOs were only 0.3% of crowdfunding raises. 2017 has been even better and has seen monthly raises pass VC investments for tech companies. A platform that allows the community itself to evaluate ICOs is certainly an advance. As noted, a Dapp disclosure mechanism will help reduce bad projects before they begin. One billion tokens are being created. 8 percent is for the founders. 12 percent sold as part of a pre ICO. 30 percent is for the ICO itself. Five hundred million are retained by the foundation. These will pay verified and accredited curators for research, verification, management, maintenance etc.

SUMMARY A Dapp is a necessary item for sorting and choosing ratings. Once set up, Dapps can assist the community in choosing the best ICOs offered. It can also help figure out which ICOs are apt Through democratic decentralized to fail and warn people in advance. methods, ICO Filter addresses the crypto-economy as it evolves. The ICO Filter Providing a Dapp within a communicommunity is able to make sophisticat- ty context is increasingly popular and ed investment deci-sions with informed utile idea. When you marry a commuconsensus. nity perspective to the larger app solution, you get an effi-cient series of choicThe ICO total market capitalization is es and a way to use them. It is here now, now over US$170 billion. It started get- as this article has ex-plained and is curting signifi-cantly bigger in 2014 when rently being developed. Keep tuned to it reached $26 billion. In three years, ICOfilter.org for updates and pre-ICO 2014-2017, funds swelled by near- launch Sept 14th. 51

SEPTEMBER 2017

BABB

The New World Bank for The Micro-Economy At BABB, we believe everyone across the world should have access to a bank account, easily and instantly. We will enable everyone to open a UK-based bank account in seconds via our smartphone app. BABB is built on blockchain technology and uses biometrics to connect people across the globe. Our goal is to reach every underbanked person in the world, totaling over 50% of the global population, to catapult them into a new era of total economic participation. 52

BABB is a global decentraler they are in the world ized banking network. It is - Providing all users with a designed to serve the miBlackcard: a payment card cro-econowhich can be my, built on issued and Pre-Sale: 28th blockchain loaded by any September 2017 user, is linked technoloby gy and acto the bank Token Sale: 1st RUSH AVERROËS cessed via a account, and November 2017 smartphone can be used app. BABB to transact proposes to with any fiat serve the unbanked, underor crypto-currency. banked and underserved by: - Onboarding new users with our innovative ‘social - Opening a UK bank acKYC’ process, which allows count for all users, wherevfully KYC-ed users to open

SEPTEMBER 2017

IN PRACTICE The four key elements of the BABB proposition - UK bank account, Blackcard, social KYC and central bank partnership. They provide us with a fully comprehensive framework for reaching the unbanked and the underbanked, where previous financial inclusion initiatives have failed. By providing our users with a UK bank account, accessed via a smartphone app, we have the means to reach people in areas with high mobile penetration and low banking use. In the Middle East, for example, there is 95% mobile penetration but 67% of the population is unbanked. This region is a key proof-of-concept target for us. The Blackcard is an integral link between the virtual product and the real world. It provides users with a channel to liquidate their digital assets - spend their crypto-currencies, essentially. The card also functions as a real-time foreign exchange tool, enabling users to spend their native currency anywhere in the world, online or on the ground.

a basic account for up to 100 other people. - Working with central banks to issue new digital currencies, to support grassroots initiatives and stimulate local economies.

others, it is the banking industry itself. Financial and infrastructural barriers to access, exist at every point on the spectrum, from ultra-poor, unbanked individuals to those who are wealthy but underserved.

Social KYC means a fully KYC’ed member, with validated documentation, can open a basic bank account for up to 100 others. To access the basic level of functionality, a person need only download the app, take a selfie and say a passphrase, creating a BABB account with an integrated digital identity. We believe there is huge potential for rapid expansion of the network thanks to this in-built ‘social KYC’ mechanism to promote exponential growth of the user base.

By working with central banks to issue new digital currencies, we can stimulate local-scale micro-economies all over the world. These initiatives can start small, with practical use cases THE TEAM such as local payment systems and they will be The BABB team is a truly diverse THE SOLUTION fully exchangeable with any other fiat or crypgroup of people spanning an exFundamentally, we believe the tran- to-currency. ceptionally broad range of experisition from the hub-and-spoke modence, knowledge and different perel of banking to a decentralized net- BABB TOKEN SALE spectives. Our team includes former work model, is one which will em- Our vision for BABB is to be a global, opencentral bankers, specialist blockpower people to solve these deeply source ecosystem for the micro-economy, prochain engineers, investment bank- BABB leveragentrenched issues. BABB users can moting connectivity, transparency and innoers, tech entrepreneurs, data science es three exciting leverage their social connectivity to vation at every level. From farming co-operaspecialists, crypto investors and re- technologies to participate in peer-to-peer financial tives that use the platform to take collective acsearchers. We are united by a desire services, raise funds for business tion to get fair prices, to the next generation of to change the world and a belief that create this decen- ventures, liquidate their digital cur- fintech companies that build into the platform tralized network rency seamlessly, and far more be- to provide new services. BABB is the means by we know the way to do it. which money can flow instantly around a bor- blockchain, bi- sides. THE PROBLEM(S) derless world. ometrics, and arThere is not one single, easily definBABB leverages three exciting techtificial intelliable problem that BABB is trying to nologies to create this decentral- BAX is the native token for use on the BABB fix. However, we can see the symp- gence. ized network - blockchain, biomet- platform. It will be at the core of BABB’s optoms of the failures of the incumrics, and artificial intelligence. The erations, both as a medium of exchange, a bent banking system everywhere, in communi- platform is to be built on a consortium-style store of value, and a unit of account. BAX is ties around the world. 2.5 billion people in the blockchain with smart contracts, to facilitate going to change the world by empowering loworld live without access to banking. In the UK instant, low-cost international transactions. cal economies from the inside out, and it is alone last year, the retail banking sector made Biometrics will enable the creation of a digital going to be the primary token in use by bil£9 billion from unfair overdraft charges. ID for each account holder, reducing the capac- lions of newly banked individuals and busiity for fraud and granting access to banking for nesses. What exactly is it that’s standing between people without formal documentation. Artifithese billions of people and access to the financial intelligence gives us the ability to carry out For more information visit babbians.com and cial services that would perfectly serve their risk management and matchmaking in a so- subscribe to be kept up-to-date with our latest needs? For some, it is a lack of banking and for phisticated and inclusive way. developments. 53

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Democratizing Broadband Access Globally For too long, consumers have been at the mercy of monopolistic telecommunications providers. In many ways, the cost of broadband and other network access opportunities has resulted in large populations being left behind. Even for users who can afford it, Wi-Fi hotspot access, signal strength, and faster connections can be difficult to obtain. 56

What if users with excess bandwidth and reliably. The disparity is demonstratcould make that available to other users ed by the cost differentials: in a secure manner, and receive inâ&#x20AC;˘ Fixed broadband centives for doing packages cost 1.7% so? Now a blockof average income by in developed counDERICK SMITH chain supported tries, compared CEO solution is on the horizon: Ammbr. with 31% of average income in deTHE veloping countries, OPPORTUNITY and 64% of average Ammbr will have income in Africa. global applicability, and be of special importance to the 3.9 â&#x20AC;˘ Mobile broadband cost 1-2% of billion individuals around the world who monthly income in developed councurrently do not have access to high-speed tries, compared with 11-25% of internet, and those mobile users needing monthly average income in developto tap into broadband more affordably ing countries.

Ammbr token sale: September 1, 2017

SEPTEMBER 2017

Ammbr is a blockchain and AI powered, multi-spectrum Mesh Network that will allow owners of Ammbr routers to earn AMMBR tokens while distributing broadband to more people in more places. SECURITY AND THE ROLE OF THE BLOCKCHAIN One of the core objectives of Ammbr is the creation of a distributed broadband access platform. The platform will be highly resilient and would simplify connectivity, while reducing the costs associated with connecting to the internet and internet based services. Simplifying connectivity would necessitate the solving of issues relating to authentication, billing, payments, settlement, security, and roaming. Ammbr aims to create a high-throughput blockchain-based platform with artificial intelligence and smart contract functionality to underpin a broadband marketplace. The technology will remove friction for the users of wireless broadband while ensuring equitable participation for the myriad owners of the infrastructure. MINIMIZING RESOURCE UTILIZATION WHILE MAINTAINING NETWORK SECURITY Current Proof of Work blockchain technologies result in incredible resource requirements in terms of faster chips and tons of electricity and cooling - and eventual concentration of power due to efficiency of scale. Proof of Stake also suffers from concentrated consensus power that grows over time.

HARDWARE AND TECHNOLOGY STACK The hardware serving the network and implementing the blockchain features is a full spectrum mesh hub with optional plug-and-play

FUTURE APPLICATIONS With a growing blockchain network the possible applications become nearly limitless. Other organizations could build financial services, or almost any sharing-economy application imaginable.

Ammbr is introducing a new hybrid approach with PoV - Proof of Velocity as the keystone. It is a new blockchain protocol that establishes an open, universal, and immutable ledger for managing the fast, high throughput micro-payment and settlements required for billions of internet connections across the Ammbr network. Ammbr utilizes a low-cost, extremely fast ASIC processor that will be commercially available to any device manufacturers, that wish to build network infrastructure components that work on the Ammbr network. PoV uses a hybridized, throttled Proof of Work consensus algorithm that limits power usage to a fraction of any Proof of Work mechanism.

INITIAL COIN OFFERING Ammbr is announcing their public Ammbr token sale for September 1, 2017. The token sale allows Ammbr to raise additional development and deployment capital. In the future, the tokens can be used to pay infrastructure owners for broadband access, or otherwise be traded.

Ammbr utilizes a low-cost, extremely fast ASIC processor that will be commercially available to any device manufacturers, that wish to build THE AMMBR NETWORK network infrastructure components that The Ammbr network is predicated on secure work on the Ammbr network. digital identities for all participants, and linked asset wallets for the native token, AMMBR. AMMBR enables the micro-payments capability required for incremental usage payments to any access point on the network. Ammbr provides real-time, accurate billing, as opposed to the typical monthly or bundled packages from traditional broadband service providers.

layers adding functionality. This allows it to extend connectivity well beyond the common Wi-Fi range and on to a variety of radio spectrum and communications protocols available in each jurisdiction.

This allows it to extend connectivity well beyond the common Wi-Fi range and on to a variety of radio spectrum and communications protocols available in each jurisdiction.

A total of 1,000,000,000 AMMBR tokens will be released. The distribution will be 60% to the community and of the remaining AMMBR tokens, 10% will be distributed to the early founders and team who funded and worked in Ammbr development prior to the token sale. An additional 10% will be distributed over time to early infrastructure developers who facilitate the fast growth of the Ammbr network. The Ammbr Foundation will retain 20% of all Ammbr tokens for long-term development. The Ammbr Foundation is based in Singapore with technology development partners in the United States, Ireland, Belgium, Switzerland and Hong Kong. For more information about Ammbr, please visit www.ammbr.com. 57

SEPTEMBER 2017

ICO Design and SEC Rulings by STEPHEN ROWLISON CEO, bBiller.com

A recent ruling by the US Securities Exchange Commission (SEC) is that Distributed Autonomous Organizations (DAOs) putting forward Initial Coin Offerings (ICOs) are to be treated as issuers of securities. I feel strongly, that this is misguided in the general case and that the SEC already has the precedent to establish that the sale of tokens in an appropriately-designed ICO is not subject to federal securities laws. In addition, there are opportunities for the SEC to embrace blockchain technologies in the overall running of their responsibilities in overseeing such determinations.

ble limitations for recovery that may be present in a poorly-designed ICO. But by not distinguishing a poorly-designed ICO from a carefully-designed ICO, the SEC is making blanket conclusions that are not always applicable.

The US Supreme Court has already established precedent in the far-reaching “Howey Test” regarding the determination of how a transaction qualifies as an investment contract. Should it qualify as such a security it would be subject to certain disclosure and registration requirements. Key to the many determinations in the Howey Test is the issue of In https://www.sec.gov/oiea/inves- the control borne by investors and their tor-alerts-and-bulletins/ib_coinoffer- active participation in their own investings the SEC is rightly cautioning can- ments. didate investors to be careful in determining the level of risk when participat- The Howey Test is based on a case that ing in an ICO. Prudent guidance is given was won by the SEC in the Supreme court regarding points to consider and possi- against W.J. Howey Co in 1946 for the sale

of Citrus groves to inexperienced business people who were not farmers and knew nothing of agriculture. W. J. Howey owned large tracts of citrus groves in Florida. Howey kept half of the groves for its own use and sold real estate contracts for the other half to finance its future developments. Howey would sell the land for a uniform price per acre (or per fraction of an acre for smaller parcels) and convey to the purchaser a warranty deed upon payment in full of the purchase price. The purchaser of the land could then lease it back to the service company Howey-in-the-Hills, via a service contract, which would tend to the land, harvest, pool, and market the produce. The service contract gave Howeyin-the-Hills “full and complete” possession of the land specified in the contract and left no right of entry or any right to the produce harvested.

The finding was that the lack of investor control in the use of the investment, dictated the investment to be a security. The smart contracts of ICO tokens can have parameters implementing the active participation of token holders, for example, by participatory voting mechanisms. Should a token holder choose not to participate, that is not a failing of the Howey Test where investors were wholly prevented from participating. The SEC would transition themselves from a regulatory authority to an Oracle of advisory, assisting the traditional fiat leaders as they transition their enterprises to fully compliant, trustless, self-governing nodes which create value.

The finding was that the lack of investor control in the use of the investment, dictated the investment to be a security. Thus, it was subject to SEC controls. And in 2017, the Howey Test continues to be used to determine whether an investment is considered formally a security or not. So, any given project’s ICO may or may not be considered a security by the way it is designed and the way the smart contract is executed.

offer, but that they are taking an active role in their participation by exercising their control in the project they have obtained from their investment. One way to do this would have the purchaser sending a notice of acknowledgement, (perhaps signing and broadcasting a transaction on an SEC blockchain) to the SEC that they are capable of determining in their own capacity of having applied the Howey Test. In so doing, they declare they are accepting the risks of investment in securities and their responsibility to participate in the project whether or not they actually take the time to do so.

Q. What distinguishes a “poorly-designed” ICO from a “carefully-designed” ICO, regarding treating the ICO as being a Should a token holder choose not to parsecurity or not being a security? ticipate, that is not a failing of the Howey Test where investors were wholly preventA. A token intended not to be a securi- ed from participating. ty but failing the SEC’s sniff test would be poorly-designed. A carefully-designed Blockchain technology has even more ICO can readily be seen (or should readily to offer the SEC in the running of their be seen) by the SEC not to be a security by organization. Examples on page 122 in the explicit involvement of token holders the https://www.sec.gov/about/secpar/ in the running of the project. secafr2016.pdf Agency Financial Report for the fiscal year 2016 illuminate Blockchain technology can even help in hundreds of millions of dollars of unthis regard and, in turn, help in other ar- accounted spending and revenues preeas of SEC purview. The smart contracts venting the report from being auditof ICO tokens can have parameters im- ed. This was because of the timing difplementing the active participation of to- ferences between obligations reportken holders, for example, by participatory ed in SEC’s financial reporting system voting mechanisms. Smart contracts en- and the data transmitted to http://USgaged by the SEC can then scan ICO smart ASpending.gov through the central Fedcontracts for anything that looks like it eral Procurement Data System. might be a security characterized by its lack of control by participants. Upon fail- Blockchain technology offers the SEC the ing such a sniff test, the SEC could auto- opportunity to connect the procurement matically blacklist the contract address systems to their reporting systems, where until an application for a security was filed they are able to stem the tide to ensure and approved. that staff operating their systems are not without the appropriate authorizations. In contrast, the purchaser of the careful- SEC staff need to become trust-less and ly-designed smart contract would be able are so empowered by the blockchain. The to prove to the world manifestly that not SEC admits in their report they are seekonly are they experienced in the purchase ing ways to ensure their systems are not of the product (namely information tech- only secure but also up-to-date, for examnology programming smart contracts) on ple, that accounts are deactivated. They

further admit that they are in breach of their own policies using the established practices. Something needs to change. To address this, SEC could apply the answer they give themselves as shown on page 139 of their report, reading “In your statement, you discuss the SEC’s IT requirements-gathering process and management of the SEC’s protective security force contract”. Alternatively, the SEC could secure their systems with a blockchain and by issuing each user with a wallet, the records of authorized expenditure, payments to anonymous third parties and procurement would resolve the need for auditing and would also fix the timing issues on flow of funds, they are currently facing. Perhaps this is a better implementation approach than utilizing a security force contract or whatever they mean by a security force contract. And so, I believe the SEC can have an important role in this new world of tokens and the blockchain, but not as a regulator. The SEC would transition themselves from a regulatory authority to an Oracle of advisory, assisting the traditional fiat leaders as they transition their enterprises to fully compliant, trust-less, self-governing nodes which create value. This is in contrast, rather, than enforcing tests by special protectionist interests and thus significantly altering the costs of performance and risk in non-compliance to external rules. Such are the cause of constraints to US-based innovators, investors and consumers of products and services. This new world reifies a market that, with an appropriately-designed ICO token, distributes active participation and decision making for not even the cost of $1.00. Such an ICO is an amazing opportunity for investors to take an integral role in the projects in which they are investing in to make successful, should they choose to do so. 61

SEPTEMBER 2017

Introducing

Brickblock A First-of-its-kind Blockchain-based Investment Platform

The volatility of the crypto space in recent years has made buying, trading, and holding cryptocurrencies and other crypto assets in this new economy incredibly risky. As new players pour money into the sector, the speculative, whimsical and sometimes manipulative nature of the market, has made it a gamble more so than a sound investment.

by CHRISTIAN NÄTHLER Freelance Writer and Editor

That’s why Brickblock is developing a platform for investors to diversify their portfolio by connecting their crypto assets with real-world assets and simultaneously hedging against the crypto market’s volatility. Its blockchain-based asset management platform allows one to invest ones cryptocurrency or other crypto assets in Exchange-Traded Funds (ETFs), Real Estate Funds (REFs), passive Coin-Traded Funds (CTFs) and active Coin-Managed Funds (CMFs).

Actively managed Coin-managed funds (CMFs) provide projects like Taas the opportunity to offer their funds to the public. Fund managers can manage investors’ funds by selecting specific cryptocurrencies, day-trading, taking profits out of diversifying portfolios and the active distribution of funds. Conversely, despite having been vetted by third parties, users can decide which fund managers and strategies to trust.

Unlike actively managed funds, the fees and costs of THE INVESTMENT Exchange Traded Funds OPTIONS (ETFs) are significantly A Coin-traded fund The content of lower since they track rule(CTF) is a passively man- the self-executing based indices like S&P 500, aged basket of crypto asNikkei 225 or DAX 30. ETFs smart contract sets like Bitcoin, Etherecan also track commodium, alt coins, and digital is unalterable, ties like gold and silver and tokens , the digital equiv- cryptographically have the advantage of being alent of an exchange-trad- secured and visible offered at near-wholesale ed fund (ETF). Like ETFs, to everyone on the prices without a minimum CTFs track rule-based ininvestment. By choosing blockchain. dices and try to mirror their preferred fund, an inthe performance of a marvestor can actively decide in ket instead of outperforming it. Indi- which market they want to invest and ces are designed by fund managers or therefore hedge risk in another induscommunity members. They could in- try sector. clude examples like the Top 10 Crypto Assets by Market Cap, Top-Performing Real Estate Funds (REFs), Real Estate Cryptocurrencies Over 5 Years, Top 30 Investment Trusts (REITs), or Real EsCrypto Assets, Top 500 Crypto Assets, tate Crowdfundings are entities activeTop Yielding Crypto Assets or Smart ly managed by a fund manager who acContract-Only Crypto Assets. quires a certain volume of real estate in

SEPTEMBER 2017

The volatility of the crypto space in recent years has made buying, trading, and holding cryptocurrencies and other crypto assets in this new economy incredibly risky. Setting up a Brickblock account is as easy as submitting a few personal details and owning a crypto asset wallet (no bank account is required).

certain cities, countries or continents. Brickblock’s platform lists real estate projects with high potential, each of which will be carefully audited by independent parties to significantly reduce risk. REFs will be the first investment type offered by Brickblock. THE PLATFORM Brickblock’s service will be facilitated through the blockchain and validated by Ethereum’s smart contracts, though the invested cryptocurrencies are not dependent on the functioning of the Ethereum platform or its price. This will void many of the fees and transaction costs associated with traditional financial institutions, makes transactions more secure and transparent than existing investment platforms, and significantly reduces the barrier of entry for many people around the world excluded from the financial sector based on income or location. Setting up a Brickblock account is as easy as submitting a few personal details and owning a crypto asset wallet (no bank account is required). Investors are then presented with the four investment options (ETFs, REFs,

CTFs, and CMFs). One then selects a fund based on information provided about the broker and their respective offerings – frequency of distributions, costs and fees, area of investment, current Net Asset Value (NAV), performance, track record, etc. Once an investment type has been decided, one deposits the amount one would like to invest into a self-executing smart contract. This generates a signed electronic document that can be viewed on a publicly available location or ledger. The content of the self-executing smart contract is unalterable, cryptographically secured and visible to everyone on the blockchain. On depositing the funds, one receives Proof of Asset tokens, which are the access key to the real-world assets acquired on the Brickblock platform. They prove the ownership of ETF, REF, CTF, or CMF shares as outlined within the smart contract. Tokenizing assets makes them versatile trading instruments (including outside of the Brickblock platform) and transactions even more secure. Owning the underlying assets directly, meanwhile, reduces the risk of contracts for difference (CFDs)

employed by other platforms that do not grant investors the the rights to the assets they’ve invested in. BRICKBLOCK INITIAL COIN OFFERING (ICO) On August 2, 2017, Brickblock will launch a five-day Brickblock Token (BBT) pre-sale. These BBT tokens generate weekly Access tokens, which are used for the fees on the Brickblock Platform. Since Brickblock fees can only be paid in Access Tokens, the more Brickblock Token holders get the more the BBT tokens are worth. Note that Brickblock and Access tokens are not the Proof-of-Asset tokens one receives when investing in ETFs, REFs, CTFs, and CMFs. The first phase of Brickblock’s token sale will offer 1000 BBT per ETH on the first day and end at 900 BBT per ETH by the fifth day. The second phase will start either at the end of September or beginning of October. You can find more information about the pre-sale including the intended use of revenue, distribution, price and phases by visiting www.brickblock. io/tokens. 63

SEPTEMBER 2017

NaPoleonX: A Decentralized Autonomous Fund, a Disruptive Investment Revolution NaPoleonX aims to become the 1st algorithmic asset management firm for crypto investors. Our value proposal is based on long standing performing trading bots running on highly liquid assets with a low frequency trading approach. 64

NaPoleonX will benefit from a large range of existing trading systems developed by an experienced team in financial markets. New ones will be added over time to maintain this existing hedge. This is an important feature of this project as R&D is key to the quantiby tative investment business.

STEPHANE IFRAH CEO & Founder of NaPoleonX

During the last 2 decades, algorithmic trading has become more and more popular within the traditional asset management industry outpacing traditional investment techniques. In-

ICO Start: September 29, 2017 End: October 29, 2017

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deed, these old fashion investment strategies have lagged into the various league tables. NaPoleonX is proposing to jump technologies by bringing to the crypto investor community the latest developments and even the future ones. This is a major trend that is still in its teenager age. This also allows the ability to take into consideration the data deluge we are all under, and benefit from the emergence of artificial intelligence and machine learning techniques. Indeed, the crypto investor community is just starting to get access to investment supports for their assets. The.DAO really launched this process by raising a private equity fund less than 2 years ago. Today, investment supports are more diverse with all these ICOs, acting as direct private equity investments linking directly the investors and start-ups. These ICOs have been mainly about services or Dapps. NaPoleonX is proposing to invest into a global asset management company, the first of its kind. We believe, this is just a baby step as we believe that, soon traditional businesses and crypto businesses will converge as the Blockchain technology diffuses in our society. We are convinced that we should be proactive in developing entire businesses into this brand new crypto space and thus participate in its expansion and normalization. This will be as important if not bigger as the internet revolution.

NaPoleonX aims to become the 1st algorithmic asset management firm for crypto investors. Our value proposal is based on long standing performing trading bots running on highly liquid assets with a low frequency trading approach.

During the last 2 decades, algorithmic trading has become more and more popular within the traditional asset management industry outpacing traditional investment techniques.

Napoleon Crypto will be set up as an asset management company to act as Advisor to NaPoleonX. Napoleon Crypto will source algorithmic strategies that will be the basis for launching trading bots. Each trading bot will be encapsulated into a dedicated investment vehicle, namely a Decentralized Autonomous Fund (DAF). These DAFs will be sponsored by NaPoleonX initially and will be open to external investors. There will be regular windows to invest or divest into these vehicles. They will also benefit from specific governance that will be encapsulated into dedicated Smart Contracts. Overtime, NaPoleonX will monitor its investment portfolio into DAFs in order to continuously launch new vehicles and collect additional Performance Fees on top of its Net Performance on its invested assets. NPX token holders will be involved in regular decisions regarding the creation, investment and divestment in DAFs. All the decisions will be proposed by Napoleon Crypto. Napoleon Crypto will also implement NPX token holdersâ&#x20AC;&#x2122; decisions. All these decisions will be incorporated into a Smart Contract that will govern NaPoleonX. In short, NaPoleonX will act as an innovative Asset Management company that will be able to launch its own funds thanks to the initial assets raised during NaPoleonX ICO. Cryptocurrencies have won their place in terms of a means of payment and have become a huge store of value. It is time now to offer new perspective to the crypto saving market. Please visit our website www.napoleonx.ai and feel free to contact us for more information. 65

SEPTEMBER 2017

Logically Consistent Principles for Token Distribution I would like to propose a set of logically consistent principles for token distributions: 1. Nobody should get something for nothing 2. Everyone should receive a market determined price by 3. Everyone should have an equal opDAN LARIMER portunity to participate CTO, block.one 4. Developer incentives should be aligned 5. Economic disincentives for buying more than 50 percent of a distribution 6. Minimize transaction costs (mining, fees, etc.) Let’s dive into each of these principles a little deeper. SOMETHING FOR NOTHING In a free market, two people make a trade when both parties are satisfied that the trade is fair. If either side finds the trade “unfair” then the trade would not occur. If one side of the exchange 66

Tokens have the most value when they are held by a wide range of people who have financial interest in the blockchain and token’s success.

provides nothing then it is considered hand out, or free lunch. Unfortunately, there is no such thing as a real free lunch. Someone must pay for that lunch which means for everyone who gets something for nothing, someone else gets nothing for something. When token distributions attempt to simultaneously sell 90 percent of the tokens at a price below market value, someone is getting something for nothing and someone else is getting nothing for something. A token distribution that is truly fair is one that enables the market to determine the price, ensuring that parties on both sides of the transaction are content with their trade. This minimizes also the chances for extreme losses to the buyer and extreme opportunity cost to the seller. MARKET PRICES A market price for something is a balance between supply and demand and

SEPTEMBER 2017

DEVELOPER ALIGNED INCENTIVES When buying tokens, you want to ensure that the other people who have the tokens have financial incentive to see the token value increase. A developer who sells 100 percent of their tokens at the very start of their project does so at the lowest possible value and then has Unfortunately, it is impossible to guess no skin in the game to motivate them to a token’s market price, it can only be add value in a timely manner. discovered with reasonable trade volumes on a public market. These markets ECONOMIC DISINCENTIVES FOR can take the form of exchanges or auc- BUYING 50% OR MORE tions so long as they are public, trans- Tokens have the most value when they parent and open to as many people as are held by a wide range of people who possible. Furthermore, even if the price have financial interest in the blockchain could be accurately determined at the and token’s success. If the majority of beginning of a token offering, it could tokens are held by a single person or change the very next day. entity and the tokens are not well distributed amongst many, this ultimately EQUAL OPPORTUNITY TO leads to centralization risks. PARTICIPATE Giving everyone an opportunity to par- Token sales with fixed prices and/or ticipate means utilizing a widely used caps quickly sell out generally to a small platform and allowing ample time for number of (usually wealthy) speculators people to learn about the opportuni- and leave little room for anyone else. ty. It should show minimal bias for or It takes time and competition to see a against those with time, money, or tech- wide distribution. nical skills. MINIMIZE TRANSACTION COSTS Mining favors those with technical The original crypto currencies were disskills, time, and money while capped tributed using proof of work or by mindistributions favor those with money ing, which represents a large economand technical skills for speed. ic loss in electricity consumption. More falls between the price no one is willing to sell and the price no-one else is willing to pay. In effect, the market price is a unanimous market consensus as demonstrated by the spread of the disagreement among all buyers and all sellers.

recent token sales experience losses in the high fees people will pay to be first. These economic losses can cause a potential loss of value in the token for both the buyer and the seller.

A token distribution that is truly fair is one that enables the market to determine the price, ensuring that parties on both sides of the transaction are content with their trade.

CONCLUSION These principles are in stark contrast to the expectation that token sales be capped at a valuation based upon the expected cost of development. Valuation capped distributions force below market pricing based upon the economic fallacy of the “Cost Theory of Value”. This below market pricing causes a race where the first buyer gets something for nothing when they flip the tokens at market prices all while giving advantages to those who can buy large quantities all at once. The EOS Token Distribution process is designed to follow these principles and hopefully create a distribution that is widely perceived to be fair based upon logically consistent principles. With EOS Token Distribution, a buyer gets the best price-per-token when they buy less than 50% and will have to pay 99x as much to acquire the second 49%. Disclaimer: The author is CTO of block. one who own a controlling stake in EOS. The author is also investing in EOS. 67

SEPTEMBER 2017

ICO Secured by a Land Asset: Sosnovkino LLC Most cryptocurrency holders face the problem of passive profits. Especially at the time of high volatility, cryptocurrency holders are thinking about methods of how to save their funds.

by EKATERINA MAKHNOVSKAYA PhD

One of the popular methods nowadays the crisis, the real estate market reis ICOs. Basically, investors, or dona- mains one of the most stable. tors, buy a token, which represents Sosnovkino Founa share of the dation decided to company. Howevlink the blockchain er, there are some technology from risks that the inthe Ethereum vestor accepts durplatform, crowding the token purfunding from ICO chase. One of the and land-developbiggest is that toment. The result kens do not have is an opportunity any reinforceto feel the abnorment. mal profits of the land-development I have learned industry and be from my own exsecured by the real perience that ICO projects are increas- assets in a sufficient amount. The comingly moving to offline business, offer- pany owns a land area of 194 hectares ings in the form of land plots and hous- with an estimated value of $3,000,000. es is a precedent in this market. Despite The main aim of the project is to create

Sosnovkino ICO is live.

The token name SNKCoin.

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an infrastructure, which includes a central sewage system, gas pipelines, electric systems, water pipelines and roads, and to sell it at a price that is 6 times more than the initial value. Letâ&#x20AC;&#x2122;s start from the analysis of the land market in the Novosibirsk region, the area where Sosnovkino land belongs to. The Novosibirsk province still has real estate as the main industry of money circulation. 18% of the regionâ&#x20AC;&#x2122;s GDP is generated in real estate and land-development. Analysts of the land market from the Lanzo agency share the opinion that the price of land plots in Novosibirsk are going to rise. The demand is constantly growing, while demand of the land plots with good infrastructure is decreasing. The development of the land complex of Novosibirsk makes this market segment the most popular and profitable field for large investments. So Sosnovkino Foundation offers investors the chance to become a part of the land-development world. By investing in Sosnovkino the investor will be able to feel the profitability of the industry with a tiny investment of $10.

Offerings in the form of land plots and houses is a precedent in this market. Despite the crisis, the real estate market remains one of the most stable.

In case Sosnovkino team fail, investors will still earn profit due to the higher cost of the land in relation to the token price. To sum up, I would say that the project is worth some attention. The team has extensive experience in their industry, therefore, should understand the technicalities of land development and construction. Sosnovkino starts its token pre-sale on August, 26th with the token name SNKCoin. In conclusion, you will get quarterly dividends straight to your e-wallet, a real share of the companies profit and a 300% increase in your funds. The project should be able to minimize the influence of Ethereum fluctuations on invested funds. It is an opportunity to convert your funds into passive quarterly profit.

Another factor you should pay attention to is the Sosnovkino team. They developed a voting system with the help of blockchain technology, hence, you can now be part of the board of Directors. All important questions will be discussed at such general meetings. Not only can you influence the companyâ&#x20AC;&#x2122;s future path but also suggest your own questions for voting. However, the voting itself, is integrated in the Ethereum wallet platform and is as simple as clicking the button. Sosnovkino decided to secure their tokens by land to reduce the risks to the investors. Each token gives investors a right to 3 m2 of land. 69

SEPTEMBER 2017

Put Your Money Where Your Technology Is… How ICO’s Tie Investment and Technology Together I was a member of a startup team for a technology company that eventually went public. Our company specialized in tools that made creating, modifying, and managing DB2 databases which was invented and owned by IBM. Our company ONLY focused on DB2 and nothing else.

by PAUL TATRO Co-Founder, Blockchain Training Institute

If you were an investor at the time and you thought DB2 was a winning technology, you couldn’t invest in IBM since they have so many other technologies and services that could affect their overall stock results. The only way to invest directly in DB2 was to invest in our company. The investment analyst called this a “pure play” investment in DB2. This idea of a pure-play investment in a technology is exactly the kind of investment that an Initial Coin Offering (ICO) delivers. If you believe in the future of an idea, participating in an ICO that showcases the path to realizing the technical manifestation of that idea means that if that technology is a big success, the value of your investment in the associated ICO will rise along with that success. Further, as the technology gets developed and begins operation, the value sustenance of the coin stays entirely inside of the realm in which the technology operates. Due to the direct link between the investment and the related technology, the

Coin that you buy is more like a “paid API token” than a unit of currency. Tokens are used to both operate inside the ICO’s Blockchain and/or purchase whatever the Blockchain is delivering. I suspect that it isn’t only the idea of a pure-play investment that is driving the ICO frenzy, in fact, that is probably assuming too much sophistication on the part of the average investor. Due to the unregulated nature of ICO’s (i.e., you don’t have to register with the SEC or any other government agency before launching an ICO) means that there are no formal rules governing the offering. One of the big differences is that an individual does not have to be a “qualified investor” to participate in an ICO. A qualified investor is someone who has a net worth of at least $1 Million and has signed a document that signifies that they understand the risk involved in early-stage investments. Or, to say it a different way, anyone can invest in an ICO no matter their net worth or their grasp of the risk involved. This gives ICO’s a possible investor base that

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This idea of a pure-play investment in a technology is exactly the kind of investment that an Initial Coin Offering (ICO) delivers. I suspect that it isn’t only the idea of a pureplay investment that is driving the ICO frenzy, in fact, that is probably assuming too much sophistication on the part of the average investor. is at least 100 times greater than the traditional technology financing base in the United States. It opens the possibility of having investors from any part of the world, from any walk of life. Many of these novice investors are not exactly sure how to properly vet this type of investment, they are more trusting of the “wisdom of the crowd” as justification of their investment. The trap here is that the crowd sentiment these days is filled with as much hype as it is fact. Also, ICO’s move the timing of larger-scale funding up, much earlier in the lifecycle of a company. The time that it takes to write a well-written white paper, is the only “development” time a company needs and an ICO can follow shortly thereafter. Very little of the infrastructure of the company needs to be developed and, certainly, no operations or sales history needs to be demonstrated. Sure, there are Angel Investors, Friends-and-Family investors, and, more recently, Crowdfunding, who will invest in a concept or because they know you, but the amount that these types of early investors are willing to invest in a promising idea is far less than the sums being raised via the ICO mechanism. The early results

show ICO’s outpacing other forms of prox. $30 to $50 million), and then a early investments by a factor of 1,000. C-Round of $150 million. All along the way, the company would had to have A good case study of all of these el- been successfully executing their busiements about an ICO is ness plan. As we see in the the recent ICO of a Blockcase of Bancor, with an ICO it chain company called Banis possible to raise $150 milcor, which is overseen by the lion a few months after pubBprotocol Foundation. Banlishing a white paper. cor had been pitched as a platform designed to make While there is a great deal it easier for users to launch While there is of interest and just as much their own blockchain toconfusion surrounding ICO’s, a great deal of kens. The Bancor ICO set a just think if Apple had an new industry record, rais- interest and ICO instead of venture funding approximately $153 mil- just as much ing? Imagine the value of the lion in Ether, the native cur- confusion “Apple Coin” that you have rency on the Ethereum block- surrounding held on to for all those years? chain, in June of 2017! The And, you bought that coin ICO attracted 10,885 buy- ICO’s, just think when you were 18 years old ers. The unbelievable notion if Apple had and only had $100 to invest. about the Bancor ICO is that an ICO instead But, back then, ICO’s didn’t Bancor was just launched in of venture exist, and the typical 18 year2017! To contrast this level old was not a qualified invesfunding? of funding with a traditional tor. ICO’s open the door to funding scenario, a company having projects funded (like would have had to have gone open-source) that would nevthrough four rounds of funding to get to er be funded any other way and give a $150 million level of investment and it every person the option to become techwould have taken, at least, three years. nology investors if they choose. So, it is The four rounds of funding would have up to you to decide if your “Pure Play” been an Angel Investment, A-Round investment in an ICO is a “Sure Play” in(approx. $2-$5 million), B-Round (ap- vestment return. 71

SEPTEMBER 2017

Revolutionary Virtual Reality Streaming Platform Supported by the Blockchain

Spectiv is a communitydriven virtual reality streaming platform that enables people and organizations to share their unique virtual reality experiences with the world. These experiences might be as commonplace as a walk through a local park or as exciting as a live music festival. Viewers will engage with these experiences from home, through virtual reality. Spectiv’s mission is to build a platform and support a network around the emerging VR industry.

STATE OF VR As the virtual reality space continues to develop, old sci-fi fantasies are slowly becoming real- life possibilities. Many tech and investing speculators have named VR as the next revolutionary boom. The VR industry is by projected to grow from $1 billion in DYLAN SENTER CEO 2016 to $30 billion by 2020 – and potentially $80 billion by 2025 (Goldman Sachs). In this time, physical VR technologies (headsets, 360 cameras, etc.) will develop and scale exponentially. As a result, emerging VR platforms are positioned to benefit from growing new-user engagement. VR ADOPTION While the potential for virtual reality is huge, the mainstream world is still intimidated by the space and reluctant to adopt it. This presents a major problem for the industry, especially those building startup platforms around it. With this in mind, Spectiv has implemented a token-based protocol to help pull VR out of the fringes. Spectiv will support a community-driven network around VR through a unique attention asset: Signal Tokens.

how this works, one must understand the attention economy framework and its key actors: content contributors, viewers, advertisers, and content curators. Content contributors create content which attracts viewer attention (greater value content = greater traffic). If the content contributor can drive enough viewer attention, advertisers are often willing to pay the contributor for a share of it. This is how traditional attention markets have functioned throughout history. However, recent tech developments have made it extremely easy for the average person to contribute/access content online, resulting in an overwhelming surplus of media. This has opened up space for a new player in the attention economy: content curators – those who sort through content and share it with their followers by generating signals (reposts, shares, likes, tweets, etc.). These signals have become a universal aspect of the world’s online experience; surfing the internet has gone from actively digging through Google to passively scrolling through social medias.

ATTENTION MARKETS Spectiv’s Signal Token acts as a fuel in This disruption has led many behaviothe market for attention. To appreciate ral economists and internet users alike 72

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to acknowledge content curators as the new central influencers of online attention. The Signal Tokens protocol is designed to mobilize this influence to support virtual reality adoption. SIGNAL TOKENS (SIGS) Sigs are an ERC20 token that curators can use to earn returns for attention driven through signals – specifically, signals to Spectiv VR content. To do this, a curator must deploy (spend) 1 Sig on a VR video. This will generate a unique URL Signal Link to that video. This link will track/analyze all attention drive through it and will connect that attention with the curator who originally generated the link. This curator will then earn a Sigs return based on how much traffic is driven.

is unique to the curator. Sigs are currently priced at $0.50, which means it cost that curator $0.50 to generate that Signal Link. The curator will then share the link with their followers. If they are able to drive 1,000 views to the video, this level of attention might earn them $1.50 in Sig returns. This means the curator profited $1.00 on the $0.50 Sig they originally deployed. But if they are only able to drive 100 views to the video, they would likely sustain a loss.

This disruption has led many behavioral economists and internet users alike to acknowledge content curators as As VR adoption grows, so will the at- the new central tention/returns that curators can drive influencers of onthrough VR content. In other words, the line attention. curator in our example might eventually be able to drive 10,000 views through a signal, which would generate them even more returns for the same effort. This means the utility value of a Sig deployment will increase as more people adopt VR. As a result, the underlying market value of Sigs will inherently be tied to the VR industry.

Curators must deploy a Sig for the opportunity to earn Sig returns on shared content. If the curator can drive enough attention to the content, they could earn returns far in excess of the original investment. Alter- SIGNAL TOKENS CROWDSALE natively, they could sustain a loss for Sigs will be publicly sold through a toinadequate traffic. ken creation crowdsale event. The crowdsale will open in mid-late SepExample: a curator sees a Spectiv VR tember and will run for 21 days or unvideo that they like, so they deploy a til the max cap ($40M USD equivalent) Sig into that video. This will generate is reached. The total Sigs token supply a URL Signal Link to that video which will be determined by how many tokens

are sold in the crowdsale. The Signal Tokens crowdsale will be hosted at www. spectivvr.com. Sigs will be issued at a fixed price of $0.50 each. Early crowdsale participants will have the opportunity to acquire Sigs at a discount to this price based on the timing of their purchase. Sigs will be sold through 4 levels, with each level representing an early bird bonus opportunity and incremental capital allocation. Magnitude of bonuses will vary depending on the timing of purchase; the earlier the purchase, the greater the bonus. This program rewards buyers who show early support and engagement with the Spectiv project. The different bonus opportunities are spread across 4 levels: Level 1: $0 – $2,000,000 Raised = 40% Bonus  Level 2: $2,000,000 – $10,000,000 Raised = 25% Bonus Level 3: $10,000,000 – $25,000,000 Raised = 15% Bonus Level 4: $25,000,000 – $40,000,000 Raised = 0% Bonus Once the crowdsale ends, Signal Tokens will be distributed via Ethereum Smart Contract. Spectiv aims to distribute Sigs as soon as the crowdsale ends, but may take up to 3 days following the close of the crowdsale to officially distribute Sigs to purchasers. 73

SEPTEMBER 2017

Ekasi Bucks

Brings Financial Inclusion to Poor and Low-Income Townships, Households and Individuals

by LUCKY KGWADI Co-founder & President Ekasi Bucks

Ekasi Bucks is a cryptocurrency built on the Bitcoin Blockchain for the community and controlled by the community. Ekasi Bucks was initially introduced as a coalition customer loyalty programme for township and rural areas. The biggest questions would be why was it established? • Ekasi Bucks was established for the revitalization of underdeveloped local economies, specifically within the poor and low-income communities. • To increase money circulation and keep it within the communities. • To create safe, secure, instant and real time transacting. The South African economy, which grew by an estimated 0.5 percent in 2016, is forecasted by the National Treasury, after a protracted period of declining GDP growth, to grow by 1.3 percent in 2017 and 2 percent in 2018 and 2.2 percent in 2019 as economic conditions strengthen. The Reserve Bank’s leading economic indicator increased for a fourth consecutive month in November 2016, suggesting a positive turn in the business cycle. Several business indices also point to an improving outlook. The recovery will be supported by moderately stronger global growth, more favorable weather conditions, reliable electricity supply, less volatile labor relations, recovering business

and consumer confidence and stabi- for new innovative ways to automate lizing commodity prices. business processes and systems and to make settlement fast and secure Household spendcontinues to grow ing is projected to throughout all inincrease by 1.3 dustries. Most per cent this year merchants today and 2 per cent in require cashless 2018 in response systems and are to moderate emmore than willing ployment growth, to transact with improved contheir consumsumer confidence ers using mobile and lower inflaphones or credit/ st th tion. debit cards rather than hard cash. The South African small busiAccording to the ness landscape is Banking associamade up of 91% tion of South Afformalized busirica, Small Menesses and condium Sized Busitinues to grow nesses conyear on year as tribute sigmore and more nificantentrepreneurs ly to the enter the varieconomy ous industries through and markets. their deBusinessvelopment es particuof new and larly in unsaturatTo w n s h i p s ed sectors where most of the econmerchants enter the retail omy. In addispace and other sectors, continues to tion, innovaincrease both from Foreign nationals tive and technology based enterprisand national entrepreneurs. Demand es can provide a platform for local, re-

Ekasi Bucks ICO phase 1 began 15-31 July 2017.

Post-ICO will begin 1 Aug – 8 Aug with PROMO code ISAKESKCUB for 20% bonus.

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gional and international growth especially in Brazil, Russia, India, China and South African (BRICS) economies to solve modern day business problems.

infrastructure accessibility for SMEs. Currently in South Africa there are several POS service providers but none are based on the Blockchain and none of them offer businesses the services that our system is packaged to offer and the low subscription fees Ekasi Bucks is a we charge. cryptocurrency

2 South African SMMES face a lot of challenges that hinder growth and development as per below: • Appropriate technological infra- 2 Ekasi bucks Pty Ltd has access to a structure database of over 100 000 small busi• Lack of management skills and nesses operated by both Nationbusiness systems als and Foreign National entrepre• Access to markets and developing neurs. Our consultants have a workrelationship with customers ing relationship with the business • Knowledge and support for the forum leaders across a wide market roles the entrepreneurs play in spectrum throughout all South Afrieconomic development can States. • Regulatory Compliance • Crime and corruption 2 There are currently over 60 000 businesses that urgently require a 2 Ekasi Bucks launched in July 2016 fully packaged cashless system from as a loyalty programme for small Ekasi Bucks i.e. Their main focus Businesses in South African Townmostly on transacting for goods and ships nationwide, since inception services and transferring funds to we have been working tirelessly to Somalia, Pakistan, Kenya, ZimbaMAKE the programme innovative bwe, Mozambique and other parts so that small businesses can comof Africa. pete with large retailers. We currently have access to over 1000 2 Our consultants have a working rebusinesses signed up for the Ekasi lationship with Private sector corBucks programme. porate companies that require loyalty programs for their clients across 2 Currently our system is website based several sectors who intend to monand we are moving operations over to etize their client base by creating a a fully functional Blockchain based network of businesses within seversystem. The Blockchain based Point al sectors to serve those clients. The of Sale System solves the problem of businesses have requested an Ekasi

Bucks fully packaged cryptocurrency reward platform administered over the Ekasi Bucks platform. 2 An Estimated number of over 10,000 businesses will be subscribed to our POS system by the end of Q4 2017, allowing us to employ over 200 consultants to ensure implementation is successful across all South African states.

built on the Bitcoin Blockchain for the community and controlled by 2 According to a chapter 2 review on the community. the South African Fiscal year budget Ekasi Bucks was established for the revitalization of underdeveloped local economies, specifically within the poor and low-income communities.

of 2017, About 31 per cent of working-age South Africans, and almost half of the unemployed, live in townships. Developing township economies that create jobs and greater scope for entrepreneurship is a policy objective for government. Townships were established as dormitory suburbs for black workers, making it difficult for township businesses to compete in anything that requires high-quality infrastructure, a wide range of inputs, a broad customer base and a diverse skill set. Government is working on reforms to promote township economies. This includes encouraging the property sector to develop infrastructure such as shops, offices, schools and hospitals. Ekasi Bucks ICO phase 1 began 15-31 July 2017. Post-ICO will begin 1st Aug – 8th Aug with PROMO code ISAKESKCUB for 20% bonus. 75

SEPTEMBER 2017

TenX

Bringing Crypto into the Real World Bitcoin is widely recognized as the first mainstream application of blockchain technology. Since then, apart from competing crypto currencies, the exchanges that support them and the booming success of ICOs, there hasn’t yet been much for mainstream consumers. One of the fundamental problems with crypto currencies is that they are very difficult to actually spend outside a few niche retailers.

Entering Crypto Currency debit cards! the offer of commission free currency Cards that leverage the Mastercard or exchange and spending): Visa payment network, linked to crypto currency wallets and exchanges. Pro- • Cardholders receive 0.1% reward in viding immediate, bank free converTenX’s PAY tokens for every purchase, sion, payment and withdrawal of crypto encouraging people to spend on the into FIAT currency at the point of sale card. This is funded by a commission by split, the merchant pays Visa/MasterMICHAEL or ATM. card for card payments. ANDREWS Recent successful ICOs for TokenCard (US$16.7), Monaco Card (US$25m) • Holders of PAY tokens receive 0.5% and established players like Wirex and of the entire payment volume on the Cryptopay show there is inplatform at regular intervestor demand for these vals in ETH, which should inproducts. One of the most crease the demand for PAY anticipated crypto card entokens. trants this year is TenX who raised roughly US$80m on • The team’s engagement the June 25th within 7 minwith the community (webTenX is utes, with thousands of insite, Slack, Twitter, Reddit, vestors missing out (over ambitious and email, webinars, Youtube 40K tried to get tokens, generating a lot etc) has been very open only about 4K managed). of excitement and professional. They are Their token is called PAY and and that should even publishing a series will be trading on major exof behind the scenes vidsee their PAY changes by August. eos that help the commutokens increase nity feel engaged and build TenX was founded in Singa- in value in the trust in the team behind pore mid 2015 and was se- near term. TenX. It really works, they lected to join Paypal’s incuare a likeable bunch. bator program. Prior to ICO, they had raised US$1m from VC investors in- • TenX is working on creating a new cluding Fenbushi and have a working Opensource Interledger protocol they card supported by Visa and Mastercard call COMIT, to facilitate true mulwhich can currently exchange Bitcoin, ti asset exchange. TenX’s stated misEther and Dash (more currencies comsion is “…making any blockchain asing). set spendable instantly.”1 They intend to achieve this by building the COMIT A number of things have made TenX protocol, which will make instant exstand out from the crowd (apart from change of any crypto currency across

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different ledgers possible in real-time and facilitate the exchange into FIAT. Currently they have to connect directly to individual exchanges or via intermediaries to convert crypto to FIAT and it’s not a scalable solution. TenX is ambitious and generating a lot of excitement and that should see their PAY tokens increase in value in the near term, but the project is not without some negative aspects: • With ambitions of being a major global player in the crypto card space, gaining a banking license and building an inter-ledger network to decentralize currency exchange, TenX are spreading themselves thin and will need to build an experienced team to make this a success. They will be competing with traditional banks and other Fintech companies who are also working on crypto payments, Interledger and cross block chain exchange (for example Ripple and ILP). • The promise of being able to convert any crypto currency is at least a year away and relies on the COMIT network being built and gaining mainstream adoption. Without it TenX will be limited in the number of currencies and rates they can provide. • Controversy at some of TenX’s overzealous marketing was unhelpful. A lot of noise was made about TenX’s use of Vitalik Butterin’s (co-founder of Ethereum) name as both an investor and advisor in the initial stages of the run up to the ICO. Vitalik complained on Twitter about the number of ICOs naming

him as an official advisor without his agree- • Also concerning to some, the VCO and ment, which led to some clarifications from co-founder Julian Hosp was disclosed to TenX about his advice being informal. His inhave been previously involved in promoting vestment in TenX was also india cash-back card pyramid scheme rect via his stake in VC firm FenLyoness. To his credit, he was open bushi Capital. about it and admitted he was fooled, had made mistakes and learned • Tax implications of converting from them. He is a charismatic guy crypto currency to FIAT where and was instrumental in making the there can be significant gains (and ICO a success and being the face of losses) due to volatility as op- One of the most TenX, so you want to believe him. posed to FIAT currency conver- anticipated sions have been glossed over and crypto card Given the level of demand during many users may be required to entrants the ICO, the PAY tokens are expectreport capital gains. This will be ed to surge in value in the short term this year is complex and potentially require and if the level of interest demonTenX to provide a solution for cal- TenX who strated by the ICO is anything to go raised roughly culating. by, they will have 40,000 users signing up for cards straight from the US$80m • The amount of money being raised on the June get-go. As Rei Inamoto, Chief Creahas been challenged by some in tive Officer for AKQA, once said: “To the community and the media 25th within 7 run an efficient team, you only need ($80M USD is a huge amount to minutes, with three people: a Hipster, a Hacker, and a raise for a company at such an ear- thousands Hustler.”2 TenX have definitely found ly stage). However, not if you comof investors their hustler in Julian Hosp – let’s pare it to traditional VC raises like hope they have the other two. missing out the Fintech currency card provider Revolut in the UK, raised $17M (over 40K tried This writer does not hold any PAY toin several rounds since 2015 and to get tokens, kens – but does hold TAAS tokens, are raising another $65M this only about 4K which is a close ended crypto fund year to expand into banking ser- managed). that have invested 1000 ETH in vices. Despite being on track to TenX – to take a page out of TenX’s have 1 million customers by the marketing playbook, that would end of 2017, Revolut lost $9 million on $3 make this writer an investor in PAY. million revenue, so the challenge will prob-----ably be: can TenX deliver on its promises be- 1 https://www.tenx.tech/ 2 fore it burns through its capital? http://www.hipsters-hackers-hustlers.com/about/ 77

SEPTEMBER 2017

SynchroLife:

Building a Global Restaurant Recommendation Platform with Blockchain Technology Despite hundreds of ways to search for restaurants online, diners continue to struggle when picking a place for dinner and restaurants around the world are in a constant battle to attract new customers. Using artificial intelligence and blockchain technology, SynchroLife is here to resolve the problems of both diners and restaurants once and for all.

by LAURA SYMBORSKI Chief Director, SynchroLife

WHAT IS SYNCHROLIFE? matches their personal tastes, and in SynchroLife is the world's first block- turn to assist restaurants in finding chain based restaurant recommen- new and loyal customers. dation platform. By rewarding usSYNCHROLIFE ers with tokens MOBILE for their valuable APPLICATION content contribA beta version of the uted to the platSynchroLife platform, SynchroLife form (without blockis building a truchain technology) ly global platform has already been rewith trustworleased as a free mothy restaurant inbile app for both formation and reiOS and Android. views worldwide. The beta version was first tested in Japan, By using blockwhere it gathered chain technoloover 30,000 users gy for restaurant and 150,000 unique business information management restaurant reviews. After the success of and artificial intelligence for recom- the Japanese beta version, SynchroLife mendations, SynchroLife is building was released for use in over 155 countries a platform that benefits and connects and 4 languages in July 2017. both diners and restaurants. SynchroLife's mission is to help diners With the upcoming token crowdsale, find good restaurants and food that the SynchroLife team plans to further

SynchroLife token crowdsale Start: September 8th 2017 End: October 6th 2017

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develop and grow the existing SynchroLife ser- average scores SynchroLife is designed to focus ing valuable content to the SynchroLife platvice with the implementation of blockchain on making recommendations based on people form. This could be editing, updating, or transtechnology and SynchroCoin token rewards. and individual tastes. lating restaurant business information, posting high quality restaurant ratings (reviews and PROBLEMS WITH THE RESTAURANT By creating a blockchain based restaurant busi- photos), adding new restaurants to the platDISCOVERY INDUSTRY ness information database, SynchroLife is open- form, marking closed restaurants in the platDespite the wide variety of restaurant search ing the door to a truly global restaurant database, form, and more. SynchroCoin rewards will be and discovery services currently available, ma- where restaurants around the world can be up- distributed from the SynchroLife reward pool jor issues still exist for both diners and restau- dated and maintained by the community. The de- once a week and divided amongst all contriburants. Restaurants struggle daily to attract and centralized maintenance model allows tors during that week based on how retain new loyal customers. Diners find them- even the huge task of keeping all globmuch they contributed. This will all selves suffering from an information overload as al restaurant information updated rebe done with smart contract on the they encounter pages of general results for a sin- alistic, as the community is rewarded Ethereum blockchain. gle search. There has also been growing distrust for their time and contributions. The and controversy in the accuracy of the averaged token economy in the platform keeps SYNCHROLIFE CROWDSALE scores and secret algorithms used in existing users coming back and rewards them The SynchroLife token crowdsale restaurant discovery services to rank search re- for putting the time and effort into SynchroLife is will start August 16, 2017 at 12:00 sults and reviewers. good quality content. These rewards noon GMT, and last for four weeks building a truthen can be used next time they go out ending on September 13, 2017 at ly global platform 11:59 AM GMT. During the token Another major issue is the sheer number of res- to eat. There may even be some users taurants, with an estimated global restaurant who turn restaurant reviewing and in- with trustworcrowdsale, 55,000,000 SynchroCoin count at over 15 million. With this many res- formation updates into a side job, like thy restaurant in- (SYC) of the total 100,000,000 Synformation and re- chroCoin will be sold. Of the remaintaurants, traditional restaurant discovery ser- many bloggers and "Youtubers". views worldwide. ing SynchroCoin, 20,000,000 will go vices struggle to maintain accurate information of restaurant openings and closings world- SYNCHROCOIN TOKEN towards SynchroLife's reward pool wide. Diners find themselves unable to use the ECONOMY SynchroLife was for users. services they are used to at home when trav- The SynchroCoin token-based econ- released for use eling abroad, because many services focus on omy connects diners and restauin over 155 coun- Please note there is no set price for only one specific city or region. rants together in a way that is ben1 SynchroCoin token during the tries and 4 laneficial for both sides. Diners are recrowdsale. The amount of SynchroSYNCHROLIFE'S SOLUTIONS warded SynchroCoin for adding con- guages in July Coin tokens an individual receives at The SynchroLife platform addresses and re- tent to the SynchroLife platform or 2017. the end of the token crowdsale will be solves many of the current issues in the restau- visiting participating restaurants. allocated according to the proportion rant search and discovery industry, for both in- They will be able to use these SynchroCoin to- of Ether (ETH) investment that individual has dividual diners and restaurants. For restaurants, kens to buy restaurant gift cards or coupons, contributed. Only ETH payments will be acceptSynchroLife only requires results-based com- tip other users, buy premium app or site fea- ed during the SynchroLife token crowdsale. Inpensation for advertising and marketing, which tures, or pay for meals at participating restau- dividuals interested should also note there will means restaurants can use the platform for free rants. Restaurants can use tokens to get access be a time bonus schedule with the first 24 hours until they actually get results. The artificial intel- to targeted marketing and analytics tools on starting off with a 20% bonus that decreases ligence based personalization in SynchroLife can the SynchroLife platform as well as offer bo- overtime, so join early if possible! also help restaurants maximize their outreach to nuses to users who come to their restaurant. gain loyal customers. For diners, SynchroLife is For more information about SynchroLife and eliminating decision fatigue by using artificial HOW DO THE REWARDS WORK? the upcoming token crowdsale, please visit intelligence to provide each individual with per- The token reward system works by rewarding http://synchrolife.org or contact info@synchsonalized recommendations. By getting rid of users with SynchroCoin tokens for contribut- rolife.org. 79

SEPTEMBER 2017

LakeBanker

Free Banking for the World and Cryptocurrencies for Billions THE PROBLEM The financial industry needs change: Banks use decades old technology such as debit cards that were introduced in 1966, ATMs that were first installed in 1969, and they still use paper. Technology has advanced at an accelerated rate by THOMAS XIE in recent years. Many industries have CEO been completely revolutionized but, banking has hardly changed at all. Their business model is out of date: They still rely on brick-and-mortar branches and tens or sometimes hundreds of thousands of employees. Wells Fargo has roughly 280,000 employers and over 6000 branches. The Agricultural Bank of China has approximately 450,000 employees and 24,000 branches. The costs of maintaining this infrastructure are immense. Because of these problems, banking is expensive, time consuming and fails to reach a significant proportion of the world’s population. Five Billion of the world’s people have little or no access to mainstream financial services and are, as a result, cut off from the global economy. Income per capita may be low but the overall market is huge. From both a humanitarian and business perspective, the traditional banking sector is a failure in the developing as well as some areas of the developed world. 80

CRYPTOCURRENCIES AS A cryptocurrencies are created. SOLUTION? 2 At the level of software, cryptocurBitcoin was invented to allow currenrencies are difficult to use for many. cy to be sent directly from one party to At the level of security, many are unanother without going through a finanable to safeguard their own wallets, cial institution. It stolen coins are therefore had the not recoverable, potential to make incorrect transacICO Phase 1 banking less exStart: September 15, 2017 tions are not repensive and more versible and misEnd: September 20, 2017 accessible. Neverplaced wallet/ theless, the propassword are not ject has yet to acrecoverable. complish this goal. The barriers to using 2 Transactions are becoming very exBitcoin itself along with other financial pensive. This has an especially negainstruments based on Blockchain Techtive effect on the accessibility of crypnology are currently too high: tocurrencies in remote or developing areas of the world. 2 They are too complicated for many, 2 Price volatility is too high. and the perceived complexity is grow- 2 Confirmation times, transaction ing as more and throughputs and overall capacity are m o r e bottlenecks For these reasons, cryptocurrencies remain unknown or untrusted outside small tech-savvy communities. Further, cryptocurrencies are not necessary for most people. Decentralisation is great, but many can live without it. Therefore, cryptocurrencies are a great (alternative) asset class, and an investment vehicle. They could be an important supplement to the existing financial world. But they have a long way to go before becoming a currency or mainstream asset. OUR SOLUTION The LakeBanker system coordinates a massive network of individuals, merchants and other institutions who provide banking services to users. The nodes in our network are called "LakeBankers". A LakeBanker provides services that would ordinarily be undertaken by the high street branch of a traditional bank, for example, to facilitate deposits and withdrawals or to conduct KYC (“Know Your Customer”) as part of credit risk management. Our mobile app uses artificial intelligence to match customers dynamically with

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LakeBankers based on real-time supply for processing card payments were around $17 and demand conditions. We will have few Billion -- over 0.6% of the entire UK economy. employees but millions will work for us. In our system, most of these transactions will be free. This Crowd-Banking model means that, when compared to traditional banks, our costs are WHO WE ARE much lower: We have no high street branch- We are the team behind cryptocurrency exes, few employees, no large corporate offices change LakeBTC.com. LakeBTC started in and no ATM machines. Instead, we leverage 2013 and has 10 million user accounts crethe potential of existing personnel and infra- ated from 162 countries. We support 42 curstructure outside our core organisation. As a rencies and 52 payment methods with hunresult, our marginal cost of supply falls expo- dreds more to come. LakeBTC is probably the nentially and approaches zero. This allows us only major platform without stolen coins, seto deliver core banking services for free and curity scandals or flash crashes. As one of to expand easily into currently underbanked the most valuable brand names in the induspopulations. try, LakeBTC has proven to be robust, reliable, and trustworthy. LakeBanker inherits its OUR FREE SERVICES core team, expertise, technology and culture. Some of the worldâ&#x20AC;&#x2122;s leading technology companies offer core services for free. For example, it BETA VERSION costs nothing to send an email with Google or A low-profile trial of the LakeBanker Crowd to share social media on Facebook. Our model Banking System was started 1.5 years ago is similar. For most users, payments will be free and today involves more than 2,000 users in the LakeBanker system. This includes user from all over the world. The demand has to user payments and user to merchant pay- been very strong even with no public anments. nouncement or media reports. MARKETS The markets we intend to disrupt with these free services are huge: Trillions of dollars circulate the globe in electronic transactions each year. But they often attract heavy fees. For example, World Bank data indicates that, in 2016 remittance payments cost an average of 7.2% of the amount sent. Thatâ&#x20AC;&#x2122;s about $43 billion in charges just for moving information. Similarly, in the UK alone, charges made to merchants

THE TOKEN: BAC BAC will be an ERC20 compliant token based in the Ethereum Blockchain. This token will drive transactions in the LakeBanker system. All fees and interest will be denominated by BAC. Our token will be well-integrated in our business model and has significant, long-term utility in our system. When the LakeBanker system is mature, BAC will circulate amongst millions and eventually

billions of users. The demand will be very strong. TOKEN SALE Phase one of our Token Sale is set to be held on Friday, September 15, 2017 at 3pm UTC. We will issue a small number of our tokens at a discount. In return, we hope to get feedback from the community and collaboration from early participants. Phase 1 - Fixed Price Sale 2 Contributions received before the start date enjoy the First Hour price. 2 September 15, 2017, 3pm UTC - September 20, 2017, 3pm UTC. 2 Phase 1 offer size is capped at 10,000,000 BAC (10 million). First come, first served. 2 Phase 1 is a fixed price sale (see the price table). 2 Fair and open to everybody. No under-the-table deals. Phase 1 Fixed Price Sale

1 ETH (price in BAC shall be determined by the market at the time of the token sale)

First hour

1300

After the first hour

1100

Phase two will be held in mid-October. BAC tokens will be tradable on LakeBTC 3 days after the close of Phase 2. Further details about the token sale can be found at https://lakebanker.com/. 81

SEPTEMBER 2017

Anacoin.

Promoting Peace with Blockchain Technology A great puzzle of humanity is how acts of evil can be committed by those who believe they are doing good, termed "altruistic evil" by Lord Rabbi Jonathan Sacks. The Nazis did not think of themselves as evil, nor do terrorists today. by ZEENA QURESHI CEO, Ananas

On the other end of the spectrum today "fake news" and ideological splits are polarizing our society, increasing hatred and division. However, ideologies are not always negative and have helped create some of our greatest achievements. The Ananas project, run by the UK-registered charity the Ananas Foundation, uses modern technology and behavioural science to help defuse negative ideologies and promote positive ones. This is a complex project made possible by the emergence of blockchain technology and token economics through our crypto-currency, the Anacoin. There is a phenomenon known as the "Dunning-Kruger effect" that will be familiar to all readers - it is when someone learns a little bit and believes they know everything. If you plot what you know versus what you believe you don't know, this is a rapid peak that we term "Mount Stupid".

This is where extremism lives and it is this certainty, which can be built in various ways, that can allow dehumanization and hatred. Where there is reasonable doubt, you are more likely to find acceptance and peace.

itally, be they religious, political or otherwise, figuring out the links between information and context. We are also building the tools to make this information readily accessible and navigable for those who follow these ideologies, helping them take the best path, simultaneAt Ananas, we believe a portion of ide- ously helping those seeking to underological hate is an information prob- stand them from other backgrounds. lem. It is possible to study radicaliFor our first step, ICO Pre-sale sation to see what we are tackling the pieces of inforpressing problem Start: 8th September mation translate of rising Islamic exEnd: 7th October into beliefs that tremism and Islamthen can lead to ophobia by maphatred and harm. ping Islam, starting However, facts with its core text in alone are usualour Living Quran ly not enough to project. move someone off â&#x20AC;&#x153;Mount Stupidâ&#x20AC;?, It is difficult to as anyone who has know where to go been involved in for reliable inforan internet debate mation on Islam, knows. Context is with the extremessential. ists and Islamophobes claiming it Our goal is to build is a religion of hate a "Knowledge and most normal Graph" mapping Muslims looking the world's maon aghast. Googjor ideologies digle ranks results

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based on backlinks and Wikipedia is sternly objective, neither necessarily reflecting what adherents believe. Religion is subjective by design, so what we need to look for is which interpretations people really believe in a verifiable way, ‘objective subjectivity’. This is where blockchain excels, enabling largescale, incentivised co-ordination of individuals to build information of great value. We have based our model on the Stanford Encyclopedia of Philosophy, allowing anyone to commission content on the decentralized, unstructured part of the platform, including the Foundation. However, the consumer application only contains data sets, pulling together information and context by Foundation-approved groups choosing the elements of what they actually believe. For example, in the Living Quran, users can see the data from the perspective of one’s own belief system, ie Christian or Sunni, or navigate and view the variants on interpretation and basic principles of other groups in as much depth as they wish. Done correctly, this makes it far more difficult for extremists of any type to warp the core message as it will be a comprehensive, up-todate and increasingly authoritative resource as it gains traction.

it for potential appreciation and status on the platform.

At Ananas, we believe a portion of ideological hate is an information problem We have based our model on the Stanford Encyclopedia of Philosophy, allowing anyone to commission content on the decentralized, unstructured part of the platform, including the Foundation.

The supply of Anacoins is fixed at 10 million and can only be minted via Proof of Social Proof. This is our unique model where chapter sponsorships are available for core texts as scarce digital assets, for example, there are only 114 chapters of the Quran available by auction.

As the Living Quran aims to collect every piece of information on each chapter and verse available, these sponsorships will increase in value with platform popularity. They are resaleable with 50% of any profit going to the Foundation via smart contract. 50% of any proceeds from sponsorships Members of approved communities are also are used to buy Anacoins in the open market and available to answer questions, helping build mint an equivalent dollar value of Anacoins for real world networks and get the right infor- the Foundation, locked for three years. mation to the right people. Approval to create data sets for the consumer apps is not granted This ties the prestige of the platform with supto groups that charge for enlightenment or ad- ply and demand for Anacoins, allowing contribvocate violence. utors to benefit from the creation of a valuable resource by a charity. To drive this, we have constructed the Anacoin to provide a unique value proposition that With the help of a growing community we becan be a model to other charities. Anacoins are lieve we can create a valuable resource that has used to commission research on the platform, the potential to make a meaningful difference. reward community participation, and to sponsor verses of the core texts, starting with the Our pre-sale is currently ongoing and the main Quran, but then covering the Bible, Vedas and token sale will be from the 8th of September US constitution, creating a constant bid. Recip- to the 7th of October, with Anacoins uniquely ients can convert this to other currency or keep purchasable in a record 28 different currencies. 83

SEPTEMBER 2017

Spheris

Decentralized Application Marketplace to Disrupt App Distribution Traditional software distribution platforms are collecting large fees from developers, all the while restricting them with strict – sometimes discriminating– guidelines. Blockchain technology is the key to disrupt their rule and bring the decentralized App Store to the masses. 84

by DAVID SHABUN

WHAT IS SPHERIS? Spheris is an open source decentralized application marketplace. Think App Store, on the blockchain. A secure distribution platform with no fees, no restrictions and available for everyone.

ple – for the people. No banks, no credit card companies. No censorship. We want it to be extremely easy and comfortable to use, both for developers who wish to integrate Spheris into their apps, and for customers who wish ICO Start Date: to purchase apps.

Our goal is to creSeptember 19th, 2017 ate a new marketTHE CURRENT place for applicaPROBLEMS ICO End Date: tions, where there For app developare no fees iners, the most disOctober 19th, 2017 volved and no recouraging thing strictions. A deabout the current centralized platform, in the complete app market is monetization. In 2014, sense of the term, powered by the peo- Gartner predicted that by 2018, less

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than 0.01 percent of mobile apps would be considered a financial success by their developers. Part of this is likely due to the fact that, most users won’t pay for apps, now that some of the best apps are free. Even if they can bring in some revenue by charging a small fee for downloads, app developers must pay as much as 30 percent in fees to the app store they use in addition to any registration fees. In addition to financial concerns, app developers also face frustrations with having to follow the marketplace’s rules. Violation of strict guidelines can get an app booted out of one of these stores, with Apple’s policies considered the strictest. Even developers who don’t have a problem following a list of rules express dissatisfaction with these marketplaces’ lack of transparency, especially when their apps are declined with no explanation. In some ways, this brings concerns about censorship, since marketplaces could decide to ban certain apps for personal reasons. THE BLOCKCHAIN SOLUTION: SPHERIS Developing Spheris on Ethereum’s blockchain allows us to provide a solution to many of the problems that developers and consumers face today with app stores. We have five main, function-specific components that together form the Spheris platform and provide complete decentralization. Users will be able to pay for apps using our tokens, sell apps outside of our main app store,

offer highly customizable subscriptions to customers (leasing apps for 25 minutes becomes possible, for example), upload apps to decentralized storage and more cool things.

Traditional software distribution platforms are collecting large fees from developers, all the while restricting them with strict – sometimes discriminating– guidelines. Blockchain technology is the key to disrupt their rule and bring the decentralized App Store to the masses. Users will be able to pay for apps using our tokens, sell apps outside of our main app store, offer highly customizable subscriptions to customers (leasing apps for 25 minutes becomes possible, for example), upload apps to decentralized storage and more cool things.

We live by the open source philosophy, and so we want developers to have a free platform to work on. No registration fees, no transaction fees. SPHERIS TOKENS (SPRS) To buy or sell apps on the Spheris platform, users will use SPRS tokens which are intended to be the “app currency”. To make prices convenient to users, and avoid sometimes confusing pricing such as 0.00719 BTC, we introduce a total supply of 2 trillion SPRS tokens. Aside from convenience, it allows for market scalability and ensures that prices for apps on the Spheris platform don’t fall below the decimal point. SPHERIS CROWDSALE Spheris is opening the crowdsale doors on September 19th, 2017 for anyone who wants to kickstart Spheris and be part of a disruptive project. Crowdsale will be open for 30 days or until all offered tokens are sold out. For more information about Spheris, visit https://spheris.io.You’re welcome to drop by for a chat with our team on our Telegram channel: https://t.me/spheris 85

SEPTEMBER 2017

ETHLend

Decentralizing and Revolutionizing Lending Globally

The current lending model is outdated! Why is lending restricted to local banks and peer-to-peer lenders? Well, this is about to change.

by MARTIN WICHMANN Head of Token Sale at EthLend

up with the idea of starting his own decentralised lending application. With a clear goal of maximal decentralisation and access to a fair lending market for everyone. After researching the topic and realizing how unfair global lendETHLend is a decentralized peer to ing markets were, Stani concluded that peer lending application that has there was a need for change and this been built on top of the Ethereum Net- new technology enables that. work. The goal of ETHLend is to use blockchain technology to enable secure WHAT ARE THE BENEFITS OF and transparent lending for everyone, DECENTRALIZED LENDING? everywhere in the world. ETHLend aims to offer liquidity to the global lending market. Decentralized The ETHLend team is developing a glob- lending provides the possibility for boral lending market where borrowers and rowers and lenders to perform loan lenders from all parts of the world can transactions from different parts of the participate in a fair lending market. The world. aim of ETHLend is to provide transparent and global lending and by doing so The borrower: erase interest rate differences between • The effect is that the borrower in different parts of the world. There are Mumbai would not be limited to lohuge differences in interest rates when cal banks and lenders. Instead, with it comes to problematic and economia single loan request the borrowers cally unstable countries such as Argenloan could be funded from all parts of tina @31%, Brazil @52% and Venezuethe world. Such a game changer might la @20%. In comparison to, for example provide more liquidity to the local Northern Europe, where interest rates lending market, hence reducing interare at a few percent. est rates due to the increasing competition. The Founder of ETHLend and a decentralization puritan Stani Kulechov, be- The lender: lieves that blockchain technology could • Global lending markets would proopen the floodgates for global peer-tovide more financing opportunities peer lending, thus providing more comwith a wider range of risk options. petition in the local lending markets. It was only last fall, when Stani started re- The speed of transaction is the edge. All searching blockchain technology and transactions are conducted within a few Smart Contracts, that is when he came seconds or minutes with the use of the

Ethereum blockchain network. This is an enormous advantage compared to the traditional banking system, where a single transaction from Abu-Dhabi to Seoul might take days. WHAT TECHNICAL PROBLEM DOES ETHLEND SOLVE? Previously decentralized lending was not considered possible since it was difficult to impose an incentive to the borrower to repay the loan due to the pseudo-anonymous nature of cryptocurrency. ETHLend came up with a solution to use ERC-20 compatible tokens as collateral for the loan. The borrower pledges tokens to receive a loan. In case the borrower does not repay the loan, the lender can claim the tokens for further realization to regain any loss. ETHLend uses Ethereum Name Service (ENS) domains as a form of collateral and reputation-based lending tool, eventually creating a decentralized credit rating. The introduction of reputation based lending will create credit profiles for the borrower. The lender can review the details of the previous loans and lenders. Moreover, such a decentralized credit rating could be easily used in other decentralized applications or the centralized economy. NEW OPPORTUNITIES FOR BLOCKCHAIN START-UPS AND ICOS ETHLend’s innovation could be used by blockchain start-ups that are raising funds via Initial Coin Offerings

SEPTEMBER 2017

(ICOs). Start-up companies can take advantage of the ETHLend platform during the Pre-ICO phase and issue some of their future tokens as a pledge for a loan. These funds can then be used for marketing, research, and development. This is just one innovative way of using Ethereum Smart Contracts for lending applications.

ject contributors, who are participating in the token sale. The main utility function of LEND is the ability to use it for paying deployment fees on ETHLend with a 25% discount compared to ETH. Hence, LEND could be seen as a priority pass to decentralized lending.

SECURE BY DESIGN All transactions are deployed with the use of smart contracts. Therefore, once a loan is initiated and deployed to the Ethereum blockchain network, it is tamper resistant, ETHLend cannot change or stop your loan requests.

Moreover, ETHLend will use a base of 5% plus an additional 1-5% (depending on the previous yearâ&#x20AC;&#x2122;s growth) of the application deployment fees to buy back LEND from the market and burn it. The idea is to buy LEND that is not used on ETHLend, from the market, to maintain the value of LEND. The effect is that the total supply of LEND decreases and the value of the remaining LEND increases.

ETHLEND TEAM Today the ETHLend team consists of 20 blockchain enthusiasts located in different parts of the world. All team members share a common aim, to provide a more democratic lending environment, by providing more liquidity to the local lending markets. ETHLEND PRE-SALE ICO DETAILS: ROADMAP TO LEND TOKEN SALE The purpose of the pre-sale is to preWhile ETHLend is continuing to develop its pare for the upcoming official token decentralized application, the team has also re- sale on the 25 November. vealed details of the upcoming pre-token sale. Starting: 25.09.2017 kl. 12.00 ETHLend introduces the LEND token for pro- GMT

Ending: 25.10.2017 kl. 23.59 GMT or when the cap is reached

All team members share a common aim, to provide a more democratic lending environment, by providing more liquidity to the local lending markets.

AMOUNT TO RAISE: 2 500 ETH TOKENS FOR SALE: 62 500 000 LEND (6,25% of total supply) LEND TOKEN PRICE: 25 000 LEND = 1 ETH BONUS TOKENS: 20% For all presale participants Pre-sold tokens are deducted from the 1 000 000 000 LEND total supply. DETAILS OF THE OFFICIAL ETHLEND TOKEN SALE ICO: Starting: 25.11.2017 12.00 GMT Ending: 9.12.2017 23.59 GMT or when the cap is reached AMOUNT TO RAISE: 37 500 ETH TOKENS FOR SALE: 1 000 000 000 LEND LEND TOKEN PRICE: 25 000 LEND = 1 ETH BONUS TOKENS: 10% for the first 200 000 000 LEND 5% for the next 100 000 000 LEND 87

SEPTEMBER 2017

Rockchain. Opening the Public Blockchain to Private Data The public blockchains have recently extended their scope to applications with Ethereum. However, those applications are isolated from rich data. Indeed, no company wants to put sensitive data on the public blockchains, whether encrypted or not. Some of those data are their DNA, and connecting those data to public blockchain distributed logic would certainly make a wonderful new use case; but currently it is not possible.

Rockchain addresses this problem by creating a distributed file system on which all nodes opt-in for data sharing or logical rules execution. We define advanced privacy rules, allowing only computation results to be publicized. The blockchain is the orchestrator, and Rockchain the link by between rich data and the public blockSÉBASTIEN JEHAN chain.

they are global access rights systems, for distributed file systems. With UNIX operating systems, we define the (R) ead (W)rite e(X)ecute rights. The e(X) ecute rights is an option to let remote computations use the local private data. We also define the groups of users allowed to access those data, a cornerstone for the data collaboration governance. In Rockchain a user is recogROCKCHAIN.ORG CEO and Inventor This distributed file system (called the nized by his Ethereum address. DappBox) is a decentralized file sharing service. The immediate benefits of We're not alone when it comes to tackdecentralization in file sharing services ling the problem of public blockchain are hosting costs, priand private networks vacy (no central servcollaboration. We coner can access the files sider this as the first ICO Start Date: content), traceability problem to be solved September 26, 2017 (the DappBox identifor public blockchains fies who’s connecting hosting distributed to request the files). applications. PolkadICO End Date: Linking the DappBox ot, driven by Gavin October 26, 2017 to the Ethereum Wood, is solving the Blockchain brings anissue with a state-cenother set of benefits: auditability (sav- tric approach, while we chose a data-cening the history of file exchange opera- tric approach. tions), and access rights management based on the decentralized Ethereum For the advanced use cases of our daarchitecture. For companies, this last ta-centric approach, we had to define an feature is critical. Basing access rights engine able to perform computation on management systems on the Ethereum data without compromising the privacy infrastructure means the ability to add of those data. The Blockchain communigovernance policies for those who are ty tends to focus on a fully homomorphic authorized to access and modify specif- encryption system as a possible soluic content. tion, which can be considered as the Holy Grail of crypto computation, with the All those features that look like ad- breakthrough having occurred in 2009, vanced use cases for file exchange ser- when Craig Gentry released his white pavices, are in fact very coherent and in- per “A Fully Homomorphic Encryption tertwined together, if we consider that Scheme” while doing his research degree

SEPTEMBER 2017

Indeed, no company wants to put sensitive data on the public blockchains, whether encrypted or not. Some of those data are their DNA, and connecting those data to public blockchain distributed logic would certainly make a wonderful new use case. at Stanford University. In short, it allows cal data. This can apply to financial reg- crypto framework performance that Rockchain addresses this problem by creating a distributed file system on which all nodes opt-in for data sharing or logical rules execution. For the advanced use cases of our data-centric approach, we had to define an engine able to perform computation on data without compromising the privacy of those data.

the computation of any function on encrypted data without knowing the decryption key. However, homomorphic encryption systems are currently not practical enough to be used in real time systems. For example, using the symmetric AES encryption algorithm (one of the most popular encryption algorithms) with a fully homomorphic encryption system would still take a few hours on standard computers. In Rockchain, we chose a practical approach to use secured two part computation to be able to compute some functions on private data without knowing the decryption keys. We improved a lot, both the genericity of using such frameworks (we’re able to use JavaScript as an input language to define the computations to be done) and the performance (we’re saving a lot of space on compiled circuits, i.e. encrypted computation scripts in short). Being able to share computations without sharing data is a critical issue to solve for creating truly dynamic distributed systems. It is of course very technical, but the technicity of the challenge should not hide the fact that it’s opening up a large number of business opportunities for blockchain distributed applications. Among the B2C business opportunities, we see health diagnosis applications, financial advising and recruiting as areas where customers would be embarrassed if their data was public and available to their insurers, employers or bank. The B2B opportunities are creating a new world of “coopetition” opportunities, where businesses are sharing very thin layers of value extracted from their data without giving access to their criti-

ulation, price discovery for example in will announce major speed and scale imhouse rentals and distributed research provements on computations that don’t on medical databases. break data privacy. Our improvement will reach the 10 factor on one or severWe're launching an ICO on September al orthogonal criterions: speed, size, and 26, 2017 - 11:00 GMT. Most of the pro- network usage. ceeds will go in developing Rockchain technology (76%) but we also allocat- Also, the DappBox distributed file sysed 12% of the proceeds for supporting tem, linked with Ethereum, will be reRockchain applications. Rockchain en- leased as an alpha version at the end of ables application owners to extend the the year 2017, well before the 18 months use cases of the Ethereum public block- for the full Rockchain infrastructure, chain, to use cases incorporating logic on with only the read access rights manageprivate data. ment system. As it will be fueled by the ROK token, the Rockchain ROK tokens Rockchain distributed infrastructure will definitely get a practical usage in a success, will depend on future distrib- few months, bringing tractions for new uted applications owners embracing the token holders. opportunity of linking the public blockchain with private data silos. That’s The performance gains in our technical why we’re devoting a significant part of implementation of secured multipart the ICO funds to assist future applica- computation, as well as the ability to tion owners when using Rockchain inhave a direct infrastructure usage of ROK frastructure. We already have a wonder- tokens for a standard use case, (sharing ful Dapp, genomes.io that is reinventing files in an organized and governed manhow our DNA should be used for diagno- ner) are good reasons to invest. More sis in the UK. generally, I hope Rockchain can attract more long term investors who underMany people ask if we’ll release our code stand that they’re betting on the idea at the time of the ICO; in fact, we have that a single public blockchain could sufchosen to release a mature framework, 18 fice for solving major collaboration use months after the ICO, rather than releas- cases, rather than the proliferation of ing debatable unfinished code. We hope different protocols. It’s a bet that resemto become a standard in secured multi- bles the time when the Ethernet protocol part computation for usability and easi- (now universal on the internet) was deness; we would certainly fail in being rec- ployed alongside other protocols focused ognized as a fair and stable platform if we on private networks, such as Token Ring. deliver a framework with bugs and unfin- Even with a risk adverse approach (not ished features, creating a significant level betting on one view of the future but on of frustration among early adopters. several competing possibilities of the future blockchain ecosystem) Rockchain is Thus, to satisfy the healthy curiosity of a great opportunity to diversify on poscrypto-developers before the ICO, Rock- sible mass adoption of these specific inchain will release a benchmark of our frastructures. 89

SEPTEMBER 2017

DentaCoin

The Future of Dental Care on The Blockchain There is a plethora of applications for blockchain technology in the healthcare industry. Within that industry, DentaCoin is taking on the challenge of developing a sound platform with a variety of tools for dental health. That challenge is as technological as it is social, cultural and economic. DentaCoin uses blockchain to bridge all these aspects and launch a service that will bring healthcare professionals, patients and suppliers together. Here is an overview of how the DentaCoin system will work. by DONOVAN OBOSI

THE CHALLENGE DENTACOIN IS TACKLING To understand the DentaCoin system, it is necessary to define the challenge or challenges that it is designed for. Within the dental care industry, there are

various challenges to tackle. Here is a • Culture, Mindset and Social Conbrief list of these challenges: siderations – Designing a system • Trust – Understanding which dental that can be applied globally. health professionals are the HOW IS best. DENTACOIN ICO Starts: DESIGNED TO October 1st, 2017 • Preventive TACKLE THESE Treatment – CHALLENGES? Encouraging paThe DentaCoin ICO Ends: tients to create team took a critiOctober 31st, 2017 habits and be cal look at each asproactive with pect of these and their dental other challenges health to preto come up with vent problems. a solution. Developers also approached the use of blockchain technology criti• Creating a Market – To create a cally, avoiding the trap of creating a tosmall economy based on the value of ken just for the sake of branding their dental health. project as a blockchain project. DentaCoin is creating a multi-functional plat• Privacy – Securing patient data. form in which blockchain technology and the DCN token play a vital, neces• Affordability – Making dental sary role. DentaCoin’s solution to these health more affordable. challenges relies therefore on block-

SEPTEMBER 2017

chain, smart contracts and an ERC20 token that underpins it all, but it also relies on a variety of different systems to complement that core blockchain technology component.

sold in the market. This insurance however, is only valid if the patient complies with the dental care policy. In return, the dentist is committed to save heal and replace the teeth of his smart contract patient if the patient complies with their obligations under the policy. These obligations are monitored by the app, and bring the dental care service provider and the patient on the same side through incentives

tween the patient and their records, and it allows for intelligent control of the medical records through the information and the trust-less time stamps in it. Additionally, this phase closes the currency cycle that underpins the whole system. DentaCoin creates value for the dental health industry, the patients and dentistry professionals. Therefore, suppliers will be willing to come in and take payments for their supplies denominated in DentaCoin.

FOUR PHASES To simplify the creation of such a complex system that involves technological challenges, as well as social, economic and cultural challenges, it is necessary to divide the project into different phases. Blockchain technology and smart contracts will play a prominent role in 4. Healthcare Database: This phase is all about most phases, while the DCN token will underhaving comprehensive medical records for THE FUTURE DENTAL CARE MODEL pin the whole ecosystem. DentaCoin has the each patient secured by the blockchain. This These phases allow for the creation of a system following four main phases of implementation: removes any middleman involvement be- that takes on the many challenges in dental health. It provides for the creation of a model 1. Blockchain-Based Trusted Review Platform: that adds value to every party within the denA platform in which patients review dental tal health industry. It also addresses cultural, health professionals on a 2-tier system, with social and economic concerns, while creating a trusted reviews having higher value and remodel for preventive care that is crucial to the wards than regular reviews. This will allow patients, and great for dentistry professionals. dental health professionals to develop a cliDentaCoin is the dental care model of the fuent base while at the same time allowing pature, powered by the Ethereum blockchain, Blockchain technology and smart contracts tients to choose based on a system of reviews smart contracts, market incentives, app develthat cannot be tampered with because it is will play a prominent role in most phases, opment, the delivery of education and accurate while the DCN token will underpin the whole data to patients, a solid review system and insecured by the blockchain. ecosystem. surance, all underpinned by its native currency, 2. Aftercare Mobile App and Educational Webthe DCN, which will power the emergence of a site: This step allows patients to engage in Developers also approached the use of blocksmall economy around the industry. preventive care with the help of an app, as chain technology critically, avoiding the trap well as education about healthcare with an of creating a token just for the sake of brandIn the future, other healthcare models might interactive game that gives DCN rewards to look up to DentaCoin to shape their own ing their project as a blockchain project. those who answer correctly. The app allows healthcare provision systems. Nevertheless, for children and adults to build healthy habthe success of DentaCoin will take care of one its with a 66-day program that comes with This removes any middleman involvement be- of the areas of healthcare that grabs the least tween the patient and their records, and it al- attention from governments, insurers and reminders. lows for intelligent control of the medical recompany benefit programs. This will catapult 3. Dental Insurance Concept: In this phase, cords through the information and the trustDentaCoin to the forefront of future healthcare DentaCoin aims to create a smart contract less time stamps in it. debates. The DentaCoin model will change the between a patient and their dentist. If both way we see dental care at a global level, which parties agree, this smart contract can be makes it one of the most exciting ICOs to join. 91

SEPTEMBER 2017

ICON

The ICON Interchain Connects Every Blockchain in Existence HYPERCONNECT THE WORLD ICON is an interconnecting blockchain network. ICON can connect independent blockchains without the use of additional third-party intermediaries. Various blockchains can communicate with each other through the ICON platform. by By connecting separately existing blockJH KIM chains, ICON aims to become the largest blockchain network in the world. ICON tokens are named ICX. ICX is used as an intermediary currency when transacting amongst the various blockchain networks. As an interchain blockchain, the ICON platform will be able to 92

host other ICOâ&#x20AC;&#x2122;s on the ICON platform. ships with existing financial instituThereby increasing the usability of ICX. tions and blockchains. ICON has already established multiple partnerships with With the recent boom of blockchain pro- banks, securities, insurance, hospitals, jects, one recurring problem is the ina- and universities. bility to communicate amongst blockchains. Decentralized blockchains have In particular, ICON organized a consortibecome siloed networks. Only by con- um with 25 of the largest financial secunecting decentralized blockchain net- rity firms in Korea. The consortium was works, can blockchain truly unlock the organized by the Korea Financial Investfull potential of decentralization. ICON ment Association (KOFIA). These finanaims to Hyperconnect the world. cial experts were interested in ICONâ&#x20AC;&#x2122;s blockchain authentication service. ICON NETWORK CONSORTIUM As an interconnecting blockchain, one As an interchain blockchain platform, of the key aspects of ICON is partner- ICON can host other cryptocurrencies

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on ICON. To kickstart the ICON blockchain eco-system, ICON is developing an education focused cryptocurrency U-Coin (short for University Coin). U-Coin will be used for paying scholarships and tuition fees. One of the key partnerships that ICON has established is with Woori Bank. Woori bank is one of the largest banks in Korea. ICON and Woori Bank will research core blockchain technology and collaborate to create a blockchain based Woori Bank cryptocurrency. Utilizing blockchain, the transaction costs of overseas transfers can be greatly reduced. ICON's blockchain network will help Woori Bank expand its reach across the globe. Woori Bank is particularly interested in the unhackibility of the blockchain, as banks have always been a target for hacks and centralized security protocols are overly complex and require high maintenance. ICON will help develop Woori Bank's cryptocurrency. Woori Bank's cryptocurrency will be initially accessible in the form of a top-up debit card. Consumers would top-up their cryptocurrency debit-cards and use the Woori cryptocurrency at Woori bank affiliated stores. ICON DEMO DAY On August 3rd 2017, the ICON team launched their Demo Day. The main purpose of the Demo Day was to opensource the ICON code to developers. The ICON team is a developer focused project. The core ICON development teams believe that ICON can only succeed when developers around the world collaborate. In order to facilitate a deeper awareness of the ICON blockchain, ICON provided a free coding session to all participants at the event. Demo Day participants learned how to generate blocks and send transactions on the ICON blockchain. By providing blockchain coding sessions, ICON can help build a more sophisticated blockchain infrastructure. One key property in blockchain is transparency. Anyone can access the blockchain explorer and check on everyone's transactions through a shared ledger. Which is why ICON is fond of having a transparent development process as well. For transparent progression, you can check the ICON source-code on the Github repository (https://github. com/theloopkr/loopchain).

With the recent boom of blockchain projects, one recurring problem is the inability to communicate amongst blockchains. Decentralized blockchains have become siloed networks. Only by connecting decentralized blockchain networks, can blockchain truly unlock the full poTHE LARGEST BLOCKCHAIN Crowdfund Capital Advisors (CCA). Retential of decenNETWORK cently, he was on the executive leaderJH Kim, ICON council member, is lead- ship team of Kinnser Software, ranked tralization. ing the ICON project. JH Kim majored in computer science at POSTECH University, has patents in security protocols, and has over 20 years of experience in the information security sector.

by Inc Magazine as one of the fastest growing private companies in the US. Simon Seojoon Kim is a blockchain evangelist and investor. Simon is the co-founder of Knowre, an artificial intelligence powered math education platform. Fast Company ranked Knowre as the top 10 most revolutionary education companies in the world.

JH Kim confidently believes in ICON’s ambitious scale, “As an interconnecting blockchain network, I believe that the ICON blockchain has the potential to become the largest blockchain in existence. Anyone can build decentralized Yiseul Cho studied at MIT, worked at applications (DApps) on the ICON plat- Facebook and ran her own start up beform similar to the Ethereum platform.” fore moving to London. In London, she set up a blockchain R&D lab for As ICON has an ambitious goal, the a major credit card company. From ICON team is getting specialized block- 2016 she worked at HSBC in their first chain support from world-class block- blockchain team focused on blockchain advisors such as Ismail Malik, Ja- chain data analytics. She also managson Best, Simon Kim, and Yiseul Cho. es the largest blockchain community in London focusing on private blockIsmail Malik has over 20 years’ expe- chain technology. rience in Technology related start-ups and entrepreneurship covering Asset ICO LAUNCH Management, Cryptocurrencies, Mo- The ICON ICO will be the largest ICO bile Payments in the City of London and in Korea. Overall, ICON aims to raise Emerging Markets working with lead- $44M over the span of 2 weeks. The ICO ing firms such as Vodafone, Cellnet and starts on October 20th, 2017 and ends News International. He was the founder on November 3rd, 2017. ICON will disof the world’s first Blockchain Lab and tribute 400,230,000 ICX which can only first ‘DLT’ company within Level 39 in be exchanged with Ethereum (ETH). 1 Canary Wharf (world’s largest Fintech ETH has a conversion rate of 2,500 ICX accelerator). (1 ETH = 2,500 ICX). Jason Best was selected as one of the 10 most influential people in crowdfunding by Forbes.com, he is a contributor to TechCrunch and Venture Beat. He is also the co-founder and principal of

One of the key partnerships that ICON has established is with Woori Bank. Woori bank is one of the largest banks in Korea. In order to facilitate a deeper awareness of the ICON blockchain, ICON provided a free coding session to all participants at the event. Demo Day participants learned how to generate blocks and send transactions on the ICON blockchain.

Anyone can create a new blockchain project and join the ICON. ICON is kickstarting a new era of hyperconnectivity. You can learn more about ICON on their website (https://icon.foundation). 93

SEPTEMBER 2017

SPARC

The Research Platform of The Future Imagine a world in which every idle computer and mobile device can suddenly contribute towards the betterment of human kind. A world in which all of us can get paid while our devices supply computing power to key research projects, is within reach. Introducing SPARC, the ICO that will make this dream a reality for people like you and me, and all those researchers out there with brilliant ideas who suddenly require a little more computing power to make the next breakthrough. SPARC PRE-ICO IS ON ITS WAY! SPARC is now offering a 100% token bonus during its pre-ICO stage. This means early contributors will get twice as many tokens to start fueling the research economy. Apart from this bonus, there are other advantages for earby ICO CROWD ly adopters, like their ability to impact the development of the SPARC platform through their feedback and more. RESEARCHERS JUMPING ON SPARC’S DISTRIBUTED COMPUTING BANDWAGON Researchers are also jumping on SPARC’s Distributed Computing Bandwagon at an early stage. This project, based out of Kingston, Ontario – Canada – has deep connections with the researchers and research institutions of its hometown. Kingston is home to world-class Canadian research institutions. In fact, the city of Kingston is largely built around these research institutions, which are involved in the development of fuel cells, other forms of clean-tech, advanced computing and neuroscience research to mention a few. SPARC is jumping in on the action, connecting its users to these projects through an on-demand platform that will allow them to rent their computing power out to researchers that need it. FROM KINGSTON TO THE WORLD Users of the SPARC platform will also be able to connect their computing resources to projects elsewhere around the world, and researchers from other institutions will be able to access 94

these pooled computing resources imassociated with the app those commediately. The SPARC platform already puters are running will get paid. has a global outreach program and its • Researchers or buyers of computfounding members have been talking to ing power will send the work packa wide variety of research institutions ages together with a fee to be held by around the world inthe platform until the cluding UC Berkley. calculations are veriPre ICO is Platform users will be fiably done, at which able to see the impact point the platform currently live of this hard work imwill release the funds mediately. But how to the rightful user. exactly will all the users connect to this The similarity of the system with Bitplatform and how will their interaction coin at a conceptual level makes it easy with it work? for everyone to understand. While Bitcoin is based on a PoW or Proof of Work HOW SPARC WORKS UNDER THE algorithm, SPARC uses a similar princiHOOD ple to deliver “Proof of Research”. To put it in simple terms, SPARC has transformed key elements from clas- SPARC, DISTRIBUTED COMPUTING sic cryptocurrency projects to enable all AND THE NEXT BIG LEAP its features and allow it to deliver ser- All these features make SPARC a provices to researchers while paying the ject that solves one of the most pressusers who rent their computing power ing issues for the advancement of sciout. Here is a brief step by step of how ence and research, while giving anythis distributed computing project will one a chance to contribute and benefit work: twice: once when they get paid for the • The platform will be based on an app. computing power they rent to research• Users will have their wallets engage ers, and once when those users have the with the app, to either sell or buy dissatisfaction of knowing that their surtributed computing. plus computing power helped fuel scien• Sellers of computing power will get tific research for the betterment of hucalculations that researchers need to man kind. Now it is time to jump on the do in packages. research bandwagon and contribute to • Those computers will then have to this project during its pre-ICO phase. Be solve those problems, and when they a part of the future of human kind and prove they have solved them, wallets scientific research with SPARC.

SEPTEMBER 2017

LAToken Last week, a blockchain startup called LAToken raised $8,5 million in just 7 hours, attracting investors with their idea of bringing crypto expansion to multi-trillion dollar markets, like equity or real estate closer than ever before. LAToken already tokenized shares by of blue chip companies and commodiDONOVAN OBOSI ties to trade them on their platform for cryptocurrencies, and step by step they will unlock the value of assets worth trillions bringing them onto blockchain technology and making them tradable, liquid assets.

with MyGold, a gold and silver manufacturing company and mint based in New Zeeland, to give crypto investors a chance to add the most popular “safe haven” asset, to their portfolios, buying it with cryptocurrencies.

LAT Token Sale Round 2 started on 5th Sep

The goals that LAToken sets are ambitious: they want to completely transform access to capital, and enable cryptocurrencies to be widely used in the real economy by making real assets tradable in crypto.

“We decentralize capital markets, making them more transparent, efficient and sustainable, while removing the cost of traditional “We decentralize capital markets, mak- middle men and “too big to fail” ing them more transparent, efficient institutions. and sustainable, while removing the cost of traditional middle men and “too big to fail” institutions. This results in smarter capital flow, empowering people across the world to bring their most productive ideas to life for the ultimate benefit of society,” – says Valentin Preobrazhenskiy, CEO of LAToken. In a conversation, he mentions that his dream is to build a “Nasdaq on blockchain” with a wider range of tradable assets. LAToken started with listing equities on their platform. Today you can already trade Apple, Amazon, Facebook and other shares. They also partnered

Eventually, LAToken aims to unlock the value of global assets worth $517 trillion, ranging from equity and real estate to commodities and works of art.

The CEO of MyGold, Richard Elliott, a big fan of blockchain himself seems overwhelmed with this partnership. “Never before has such exciting technology existed where gold could be combined with blockchain. By combining those, you get the best of both — the security of having a physical asset and the convenience of a crypto. With LAToken, we have found the perfect way to make gold more accessible, convenient, and tradable,” —Richard explains. Eventually, LAToken aims to unlock the value of global assets worth $517 trillion, ranging from equity and real estate to commodities and works of art. To do so, they don't just allow investors to purchase them at minimal transaction costs and maximum transparency and security, but also tokenize them to sell them by fractions allowing small investors to enter previously accessible only to large investors. For example, a share in Apple Inc. today costs $157, and an ounce of gold is almost $1300. Before LAToken started its trades, it was impossible for an investor with just $50 to own any of them. But today you can get fractions of both for any amount you want to spend. That’s’ how, by bringing trillions onto blockchain, and millions into previously inaccessible markets, LAToken bridges the crypto- and real economies. They believe crypto will dominate the global economy, and so do we. So, let’s just watch the blockchain revolution win. 95

SEPTEMBER 2017

Negotiating the ICO minefield Is ZILLA The New ‘Amazon for ICOS’? With more than 1500 ongoing ICOs and counting (source: CNBC), it is becoming overwhelming for buyers to compare and assess them. By design, in the world of cryptocurrency (for better or worse), there is no central authority or institution to act as a reference point. For even the most experienced crypto enthusiast, hunting down and researching new ICOs remains a challenge. There are several sites out there doing this but, once the research is done and a buyer is keen to participate in an ICO, they then need to jump through a number of by hoops to do so.

ABASA PHILIPS CEO

get worse before it gets better, as others lose faith in the industry, at a time where the number of upcoming ICOs is increasing, hunting out the scams and promoting the companies raising funds for great projects is becoming crucially important.

From there he founded PRIMO.im, a unique payment platform that allows users to scan products in a store with a QR code, buy them and then skip the checkout, all with just one click. Now he is looking to do something similar in the crypto space, with what he calls the “Amazon for ICOs”.

Fortunately, a team based in Singapore, led by Abasa Phillips - an American se- As such, ZLA PTE Ltd was founded rial entrepreneur who has been in the in 2017, with what Phillips calls “My payment industry since 2009 - is hoping dream-team of online payment, blockto change all that. chain, commerce, A former counand finance extry manager in Japerts”. In May of ICO Start Date: pan for Paysafe, that year, the con19 September 2017, 10pm Philips has lived in cept was finalized Tokyo time Japan for 15 years and work on ZILand speaks JapaLA began. WithICO End Date: nese and Chinese in a few months, 26 September 2017, 10pm Philips had reasfluently, he has Tokyo Time been buying Bitsembled much of coin since 2012 afhis team from his ter Roger Ver gave previous recent him his first Bitcoin.” I fell down the rab- projects and the company incorporation bit hole and I haven’t looked back since.” was finalized in Singapore in August.

Moreover, the industry has been plagued recently by scams such as fraudsters on Slack posing as members of the ICO team, hackers who create clone ICO sites that look identical to the real thing, to downright fraudulent crowdsales by companies looking to make a In 2013 Phillips co-founded Pegapay. quick buck and then disappear. com, a bitcoin wallet similar to CoinProblems like this undermine the credi- base, but the project lost steam afbility of the sector and events like these ter the Bitcoin that they were using to are surely one of the reasons why the fund the company disappeared from Chinese government is beginning to the vaults of the MtGox exchange that crack down on ICOs. The problem could was hacked in 2014.

And what has the company been creating, exactly? With ZILLA, Philips wants to address all the pain points associated with ICO participation. In the same way Etrade made the stock market accessible to the general public, or Amazon made it easy to buy products

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online, ZILLA provides a unified marketplace for ICO crowd sales.

the platform. All purchase fees are waived for ZLA token holders.

This aims to make the whole process more accessible to everyone and to set up a set of best practices for companies considering launching an ICO. “I want participation in an ICO, to be so easy that even my grandmother can do it”, he smiles.

ZILLA will also provide a merchant API which will allow retailers to accept payment in tokens, and to allow users to easily spend their tokens at thousands of online and offline merchants worldwide.

Problems like this undermine the credibility of the sector and events like these are surely one of the reasons why ZILLA mobile app users, are presented with a the Chinese government is beginning to comprehensive list of ICO projects. From there, crack down on ICOs. they can upvote or downvote projects, watch the team video, pre-register their KYC / AML documentation, and participate in their chosen project with a single click, using a credit card, cryptocurrency, or other ICO tokens. ZILLA will be the first multi-lingual ICO marketplace – in Japanese, Korean, Chinese and English.

To raise funds for this development, ZILLA themselves will be doing a Token Sale which will be livestreamed on ZLA.io. The event will take place on the ZLA.io website from 10pm Tokyo time (UTC+9) on 19 September 2017 to 10pm Tokyo Time on 26 September 2017. 1 ETH will buy 250 ZLA Tokens (with a 20% early contributor bonus available). ZLA is an ERC20 token on the Ethereum blockchain.

A former country manager in Japan for Paysafe, Philips has lived in Japan for 15 years and speaks Japanese and Chinese fluently, he has been buying Bitcoin since 2012 after Roger Ver gave him his first For participants who would like to know where Owners of an ICO can upload a description of Bitcoin.” I fell down the rabbit hole and I their money is going, once the token sale is fintheir project, biographies and qualifications haven’t looked back since.” ished, work efforts will be redoubled in time for for all team members, business plans, funders and advisors. Buyers can upvote and downvote projects based on appeal, so everyone can add their opinion once they have registered for an account.

the app launch, which is slated for December. By February 2018, a payment gateway partnership development will begin, in the following month a cryptocurrency exchange partnership is due to be made official.

Token issuers who launch an ICO crowdsale on ZILLA will be charged 2% of funds raised as a fee for using the platform. Users who purchase ICO tokens will be charged a 1% fee for using

In May 2018, the team will begin testing the payment gateway, with the aim to release it July/August 2018 - just a year away from now. It’s going to be an exciting year at ZILLA. 97

SEPTEMBER 2017

DENTALFIX A Decentralized Blockchain Platform for Dental Clinics and the Supply Chain Health and government organizations spend a significant amount of time and money setting up and managing traditional information systems and data exchanges; requiring resources to continuously troubleshoot issues, update field parameters, perform backup and recovery measures, and extract information for reporting purposes.

Hence, the current solutions pursued by the Health Care technology industry have resulted in a difficult choice between care and privacy/economic fraud for patients. We see this issue greatly expanding as more data is being created by the industry. Blockchainâ&#x20AC;&#x2122;s secure technology, properties, and distributed nature can help reduce the cost and efficiency of these operations as well as provide a viable security infrastructure.

ken is to regulate network storage allocation, health care quality measures and revenue payment cycles. Patients are given an allotted amount of space to store information for free on the DENTALFIX network. DFBT allows them to purchase extra storage space from nodes set up in hospitals systems. DFBT can be purchased via the platform or an exchange. Healthcare organizations use DFBT in this instance as well. It is also used in payments once smart contracts are exeHEALTH INFORMATION cuted with healthcare insurance compaEXCHANGE AND TOKENS nies and serves as a mechanism to reguThe DENTALFIX token (DFBT) is the late value based model metrics. In order fuel for driving the blockchain infra- for the countries to successfully move structure. The primary usage of the to- away from the fee-for-service model to

ICO

by SERGEY SAFRONOV Serial Entrepreneur Co-founder & CMO of DENTALFIX

Start: August 13, 2017

End: September 13, 2017

SEPTEMBER 2017

the current value-based model, there must be a healthcare IT infrastructure that allows organizations to link quality, value and effectiveness of medical interventions through a reputable compensation model. Compensation will be based on how effective the network of providers’ work together to ensure improvement in the quality of care and wellness outcomes, while at the same time reducing associated care cost. To truly incentivize different participants in the network to pro-actively create better care regimes, a merit based compensation of shared savings (reimbursements) takes effect. In order to effectively allocate a proportionate share to the provider in the network that contributed the most towards the overall savings, a clear tracking of their contribution is measurable executed by smart contracts on the blockchain network. Another key impact of the new healthcare paradigm is the compensation model where-in the providers are eligible for receiving additional compensation beyond the care delivered. This compensation is the result of savings that are generated based on how effectively the providers manage the care of the patient’s health outcome (incentives). Any savings generated through efficient management of the patient’s care can be retained by the providers and their network partners as part of the shared savings aspect of the new healthcare paradigm.

structure for the foreseeable future. The future is a vibrant ecosystem of many tokens, for which healthcare will need a closed loop payment system in place. The result will be an efficient care cycle management positive feedback loop with significant decreases in billions of dollars currently attributed to healthcare payment fraud.

The current solutions pursued by the Health Care technology industry have resulted in a difficult choice between care and privacy/economic fraud for patients.

The founding team will receive a 10% allocation of DFBT. These tokens will serve as long-term incentive for the DENTALFIX founding team. An additional 20% will be allocated to the DENTALFIX Foundation fund to be used for research and development regarding blockchain technology for healthcare use cases. Total of 100 million DFBT tokens will be created through the Smart Contract System.

TOKEN ACQUISITION DFBT can be acquired through DENTALFIX’s native app, crypCONCLUSION to-currency market and from anBlockchain will play an increasother patient, physician or iningly significant role in healthsurer via transfer. Platform uscare IT and bring beneficial disers will have the ability to acquire ruption and new efficiencies to DFBT by sending Ether (“ETH”) We firmly believe every stakeholder in the ecosysto the DFBT creation contract on It is vitally important that that using a token tem. the blockchain during a pre-sale. healthcare organizations unThe DENTALFIX interface will in- is the best payment derstand the core of blockchain tegrate third party trading solu- system to support technology to ensure they are tions such as Coinbase for users this infrastructure ready for the changes the techwho do not have ETH. The DEN- for the foreseeable nology entails. The result will TALFIX Token initial distribution be a new generation of powerwill be in the form of a presale. An- future. ful, blockchain-based applicayone will be able to acquire DFBT tions that will shape the next at a discount rate by pledging ETH era of business in healthcare. For into the token sale smart contract. Those with blockchain to fulfill its potential in healthother cryptocurrencies such as ETC or BTC can care, it must be based on standards to assure We firmly believe that using a token is the create DFBT via a third-party conversion ser- the compatibility and interoperability within best payment system to support this infra- vice that will be available on the pre-sale page. the health care system landscape. 99

SEPTEMBER 2017

RECoin:

The Flagship of Charitable Cryptocurrencies is About to have ICO The fact that the Blockchain technology is not that new (the security and network distribution protocols constituting the blockchain go back to the origins of electronic computing, which is the early 70s) doesn’t make it more comprehensive for laymen. Googling “blockchain” will inevitably lead you to YouTube where a host of adroit investment bankers-turn-innovators will take you through the same basic spiel: whatever makes the blockchain tick is just too complicated for a “regular person.” 100

However, you’re told, blockchain does present the public with a list of benefits and cyber money i.e. crypto currency is the latest and most fascinating of them all. by ANTON SHMERKIN Editor-in-chief of Cryptonetwork

But by the time the blockchain advocates get to the nitty-gritty of the cryptocurrency vs. fiat currencies, you’re sold. Although, still not clear on whether or not it’s real money: most of the 700 crypto currencies that are plowing the market right now are unsecured, meaning, not backed by any real commodity. But the accessibility, the speed of transaction, the cyber security, the reliability, the liquidity – are all true and very appealing to someone who already has money to spend and wants to invest.

To me, though, since I don’t have any money, and if I did, I would probably keep it under the mattress, the charitability of cyber money would be the most important selling point. I’ll explain. You see, the cyber currency itself has never lifted anybody from poverty. The legends enshrouding unsecured crypto currency (like, you get to digitally “print” as much of your own money as your heart desires and get rich exploring the possibilities of the “dark web” and many others) are not just malicious misrepresentations of the reality. If you take them at face value and act upon them, they may lead you straight to being subjected to criminal prosecution.

ICO

Start: 7th August

End: 9th October

SEPTEMBER 2017

On the other hand, we hear all kinds of success stories when a certain crypto currency introduced into a small community all of a sudden lifts that community above the currents of the financial market. Before you know it, the soccer moms start trading cookies in “hearts” and do $10 million worth of neighborhood e-commerce. So, what gives? I think the perfect balance between a genuinely charitable crypto currency and a genuine opportunity to invest in something tangible is RECoin. It’s brand new and about to have an ICO sometime in August but nearly half of its white paper is dedicated to the charitability of it, and after researching RECoin a bit, I think I understand why. The RECoin Group and the 101RECoin Trust founder, Maksim Zaslavskiy, was born and spent his adolescence in the Soviet Union but his parents had managed to move him to the NYC in the early 90s. So, as you

Although, still not clear on whether or not it’s real money: most of the 700 crypto currencies that are plowing the market right now are unsecured, meaning, not backed by any real commodity.

can tell, Max had understood the notion of “suffering for success” early on and all too well. And that’s one of the reasons he felt giving back to the community is not a charitable deed but a duty. Ever since graduating the Baruch College in 2003 with an MA in finance, he’d looked at “making the world a better place” not as a pretty tag line but a project. Maksim Zaslavskiy is a humanitarian with interests in several global charities. 2% of all mined RECoins will be dedicated to the many charities he had listed on his prospectus from the very beginning, along with 6% of every transaction commission. This is equivalent to up to 70% of RECoin’s remaining profit after all expenses and real estate reinvestment. With that in mind, RECoin was conceived. Here’s the kicker: if you haven’t made that out already, it’s the only (sic!) crypto currency on the current market that is backed by real estate in the US, Canada, Switzerland,

and Japan. Max and his team state outright that charitability and social consciousness is an important purpose for RECoin’s existence. They write the charitable deductions directly into the program code to ensure that the cryptocurrency always distributes a portion of its earnings to those who need it the most. So, which charities? Again, the list goes on for pages, but the ones you might be familiar with are the Live Love Laugh Global, Homes for Our Troops, World Vision, Feeding America, Doctors Without Borders and many others. Another great opportunity for those deciding to invest into RECoin would be the ability to create side chains of their own within the RECoin ecosystem (remember “The Godfather” when Tessio and Clemenza ask Don Corleone to branch off and create their own Families under the protective umbrella of the Corleone name and power? Kind of like that only in total compliance with the US law). The availability of RECoin side chains will allow for the cryptocurrency to be creatively utilized by entrepreneurs and developers as an investment tool for the benefit of society. In broader (and slightly metaphoric terms) RECoin is going to become the flagship of the charitable cryptocurrencies, and you are invited to be a part of this glorious movement. www.101recoin.com 101

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ACT World 2.0 is a place where Citizen Power matches State Power. A world where Citizens are able to hold the State accountable and make it responsive to their needs. ACT is a Decentralized Autonomous Organization that will launch later this year. It aggregates funding from unlimited numbers of citizens targeting change, and it organizes decisionmaking on the Ethereum Blockchain. 102

Ready for World 2.0

ACT founder Fraser Brown from Northern Ireland believes we need to get to World 2.0 as soon as possible, and blockchain technology is the only way to get there. From his perspective of advising Governments and International Organizations on innovative finance for by DWIGHT climate change he believes that the reSPROULL sponse to global issues is not happening fast enough. About the issue he says, “Some big challenges are slowly getting addressed, like climate change, but what we haven’t seen is empowerment at the grassroots level so that citizen voice is amplified to the extent that the people can drive change”.

crete proposals and get results. ACT works by having users submit proposals that are vetted by curators, and then pushed to the community of ACT users for voting. Proposals that reach a quorum of 60% “yes” votes are funded by the smart contract. ACT works by citizens paying Ether for votes on the platform. Of course, they are limited in how many votes can be applied to a proposal so that no one can purchase influence. The platform differs from crowdfunding because causes are funded out of the pool created by vote purchases. This “revenue” is distributed: 80% to causes, 15% to curators, and 5% for platform and community maintenance.

Enter ACT, where citizens are em- The ACT and ACTION tokens described powered through a revolutionary new in the white paper (https://www.daoact. crowdfunding model to carry out con- org/whitepaper) apply to the ACT Cura-

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tion Engine (ACE), where holders of ACTION (a vesting token that derives its value from ACT) earn rewards based on curation effort, reputation on the platform, and a number of other factors.

According to Fraser Brown, “This is what happens. Communities such as those represented by the United Valleys Action Group can generate significant support and goodwill but the resources of fossil fuel companies are vast. As part of a global outcry last May, the existing coal mine was closed down by protesters who came from all over Europe but when the dust settles the corporate machine continues to search for profit regardless of the cost to people and planet”.

Inflexion point: Issues such as climate change, biodiversity loss and food security will have consequences that are going to bite down. Simultaneously, the proliferation of crypto tokens will continue. When combined these two things will make people look for a real solution that empowers them to take the reins rather The Welsh case study is an example of the imthan the wrecking ball approach as some have balance in power that citizens face and it is this described Brexit and Trump. issue that ACT will address. In the case of the Caerphilly community in Wales, an Alpha re“This is what happens. Communities ACT will be the tool that global citizens can lease of the ACT platform will be used to ask such as those represented by the United use to get control and ensure change. The ACT citizens around the world to support. The hope Valleys Action Group can generate project has just announced a partnership with is to contribute significantly to the £40,000 significant support and goodwill but the a community in Wales that is a great example they need to raise to put proper representation of the issues of Social Accountability that the to the current public enquiry and ensure that resources of fossil fuel companies are vast. As part of a global outcry last May, platform seeks to address. The community is neither the mining company nor the governopposed to a new open-cast coal mine after the ment can cross this line. ACT has already raised the existing coal mine was closed down first one they opposed in 2004 went ahead with $230,000 from over 400 participants to build by protesters who came from all over devastating consequences for the health of lo- the Decentralized Autonomous Organisation cal people, the Welsh environment, and even (DAO) on the Ethereum blockchain. This preEurope but when the dust settles the employment in the area because it became so ICO ended on August 1st and is superseded by corporate machine continues to search undesirable as a place to live. Their local coun- a Pre-release Access phase which is now open for profit regardless of the cost to people cil has already unanimously rejected the plan- via the ACT website (https://daoact.org). In and planet”. ning permission for the second mine but Millar this phase participants can obtain 100% more FRASER BROWN ACT founder Argent, the mining company, lodged an appeal ACT tokens per Ether than they will be able to with the Welsh Government in January and during the token distribution event (or ICO), are using their big resources to forge ahead. which will take place in November.

Some big challenges are slowly getting addressed, like climate change, but what we haven’t seen is empowerment at the grassroots level so that citizen voice is amplified to the extent that the people can drive change”.

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SEPTEMBER 2017 | ICO UNIVERSITY

El modelo

ICBM

Intellectual Capital Business Model

para invertir exitosamente en

ICOs

INTRODUCCION Estamos ante una nueva ola de cambio en el ámbito de la Tecnologías de la Información y Comunicación (TIC), gracias a la tecnología Blockchain, que está permitiendo desarrollar cientos de startups en la actualidad y miles de éstas en by los próximos años. Blockchain comenzó ISMAEL a desarrollarse a través de Bitcoin y en la SANTIAGO actualidad, se le están dando cientos de aplicaciones de las grandes empresas del mundo financiero, a partir de las startups de Fintech y muchos otros proyectos empresariales, que buscan darle utilidad a herramientas concretas como son los contratos inteligentes.

Initial Coin Offerings

te, financiando los gastos necesarios hasta el lanzamiento definitivo del producto/servicio. Su funcionamiento suele ser el siguiente: se crea una nueva criptoconversión en un protocolo como Counterparty Openledger o Ethereum, el valor del token es arbitrariamente determinado por el equipo gestor del proyecto, según las creencias de éstos del valor de la red. Posteriormente, a través de la dinámica de la oferta y la demanda, el valor es fijado por los participantes de tal mercado, sin la participación de ningún gobierno o autoridad central.

más líquidos que permite la conversión inmediata y sencilla de Bitcoins, Ethers u otras a moneda fiat, empleando aplicaciones como Coiobase o Coinsbank.

El surgimiento del fenómeno de las ICOs se ha traducido, en menos de 12 meses, en una capitalización de mercado de más de 150.000 millones de dólares. Estas cifras tan astronómicas, han creado millonarios en todo el mundo en un corto espacio de tiempo.

Para tokendata.io, a partir de julio de 2017, hay más de 130 ICOs en activo, multiplicándose este número para los próximos meses.

A estos nuevos modelos de financiación emergentes y disruptivos, que combinan la innovación financiera con la criptografía, los hemos denominado Blockchain Finance o B-Finance. La prueba de su importancia, en el ámbito financiero, lo encontramos en sus cifras cada vez más crecientes, como mostraremos a continuación.

En 2017, estamos presenciando a la introducción exitosa de un nuevo modelo de financiación inicial para proyectos empresariales, denominado ICO (Initial Coin Offering). Las ICOs se inspiran en las IPO. Al igual que ocurre con una oferta pública inicial, se emite una cantidad determinada de tokens (títulos en las IPO) para captar una determinada cantidad de fondos en los mercados, por el público en general, durante un período de tiempo determinado. Una vez adquiridos tales tokens podrán ser libremente intercambiados en el mercado.

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Según los datos históricos suministrados por coinmarketcap.com, en los últimos años podemos ver el crecimiento exponencial global experimentado, en la capitalización total de mercado de todos los criptoactivos, tal y como muestra la gráfica:

Un token es un activo intangible almacenado en una cadena de bloques que da derecho a su tenedor a un conjunto de derechos (y posiblemente pasivos) establecidos en contratos inteligentes y otra documentación relevante (White paper).

El aumento de liquidez de estos criptomercados, el desempeño positivo de éstos, los flujos de efectivo que generan y el crecimiento de tres dígitos ha atraído el interés de inversores y especuladores.

Los ICOs se han convertido en una forma popular de financiar proyectos de criptoinversión, permitiendo a un proyecto empresarial financiarse mediante la venta de tokens, y que los promotores de una buena idea puedan llevarla a cabo, atrayendo a capital humano talentoso. Las Initial Coin Offerings suelen producirse antes de que el proyecto se comple-

• El 27 de diciembre de 2015, la capitaPor ejemplo, el Capital Riesgo está cada lización de mercado total de todas las vez más interesado en las ICOs; las canticriptográficas fue $ 6,840,297.45 dades de capital necesarios para obtener • El 25 de diciembre de 2016, la caun “unicornio” y la obtención de liquidez pitalización de mercado total de touna vez que se llega al proceso de IPO, das las criptas de divisas fue de $ hacen que comparativamente se vea con 16,106,711.00 mejores ojos las criptoinversiones, que • El 23 de agosto de 2017, la capitalizapermiten obtener ganancias más rápidación de mercado total de todas las cripmente, gracias a unos mercados cada vez tas de divisas fue de $ 150.668.852,22

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Crear valor es el conjunto de beneficios para el cliente del que está dotado la propuesta de valor. La propuesta de valor describe los beneficios que los clientes pueden esperar de los productos y servicios ofertados por una empresa Esto nos lleva a la conclusión de que el modelo de negocio y la propuesta de valor deben estar perfectamente integrados. Según Osterwalder et al. (2015), la Propuesta de Valor tiene dos caras: Mapa de Valor y Perfil del Cliente. Para coindesk.com, la nueva financiación mensual de las ICOs, en dólares, ha experimentado un aumento espectacular en los últimos meses, como lo reflejan los siguientes datos del gráfico: • El 17 de marzo de 2017, la nueva financiación de la OIC ascendió a 19.42 millones de dólares. • El 17 de abril de 2017, la nueva financiación de la OIC ascendió a 103.74 millones de dólares. • El 17 de mayo de 2017, la nueva financiación de la OIC ascendió a 232.04 millones de dólares. • El 17 de junio de 2017, la nueva financiación de la OIC ascendió a 462,04 millones de dólares. • El 17 de julio de 2017, la nueva financiación de la OIC ascendió a $ 574,48 millones de dólares. No tenemos duda, esta nueva forma de hacer las finanzas, que hemos llamado B-Finanzas o Blockchain Finanzas ha llegado al mercado para quedarse. Ante los retos que plantea estas nuevas finanzas es fundamental contar con una herramienta que permita ayudarnos en la gestión y valoración de los proyectos empresariales que están detrás de estas ICOs, para no volver a cometer los errores que sufrió el mercado en la crisis del 2000 de las puntocom.

INTELLECTUAL CAPITAL BUSINESS MODEL (ICBM) PARA VALORAR INVERSIONES EN ICOS La metodología propuesta en este artículo, para valorar exitosamente inversiones en ICOs consistirá en la integración y el alineamiento de sus tres conceptos fundamentales: el modelo de negocio, el capital intelectual y los denominados “fosos económicos” (generadores de ventas competitivas sostenibles).

El Mapa de Valor (Propuesta) describe las características de una proposición de valor, especificadas de manera detallada y estructurada, en un modelo de negocio. Estará formada por tres componentes: creación de ganancias del cliente, soluciones a los problemas de éste y los productos y servicios a ofrecerle.

El perfil de cliente (Segmento) describe un segmento de cliente específico en su modelo de negocio de una manera más estructurada y detalladamente. Estará formada por tres componentes: MODELO DE NEGOCIO ganancias esperadas por los clientes, problemas El modelo de negocio es una herramienta de ges- y trabajos de éste. tión que permite a una organización crear, entregar y captar valor, atendiendo a los intereses de Necesitamos ajustar los componentes del mapa los clientes, accionistas y otros grupos de interés. de valor con los del perfil de cliente. Es decir, Para validar el modelo de negocio que presenta una ICO, se debe dar respuestas lógicas y solventes a las siguientes cuestiones: • ¿En qué consiste la propuesta de valor diferencial del proyecto implícito en la ICO? • ¿Cuáles son los segmentos de clientes que se pretenden alcanzar y cómo proporcionarles valor? • ¿Cómo se comunica, de manera efectiva, la existencia de esta Propuesta de Valor a un a los segmentos de clientes seleccionados? • ¿Cómo hacemos disponible tal Proposición de Valor a nuestros clientes objetivos? • ¿Cuántos ingresos, costes y beneficios generarán la ejecución de este modelo de negocio?

cuando la propuesta de valor se centra en las tareas diarias importantes del cliente, resolviendo cualquier cosa que les moleste y creando los resultados y beneficios que éste espera. Las propuestas de valor exitosas se basan en estos ajustes eficaces. Estos ajustes se producen en el mercado en tres etapas: 1) problema y solución presentada en la propuesta de valor, 2) producto y mercado (reacción positiva del mercado a los productos y servicios ofrecidos por la empresa durante este proceso) y 3) modelo de negocio escalable, en términos de crecimiento y rentabilidad (Osterwalder et al., 2015).

CAPITAL INTELECTUAL Este modelo que planteamos lo hemos denomi- Para entender la importancia del concepto trata- (INTANGIBLES ECONÓMICOS) nado ICBM, el cual lo exponemos a continua- do en este subapartado debemos de entender en Una vez comprobada la articulación de la proción. lo que consiste crear valor y propuesta de valor. puesta de valor diferencial en el modelo de negocio de la empresa objeto del ICO a valorar, analizaremos la existencia del Capital Intelectual del que Sustainable Competitive ECONOMIC MOATS Advantages dispone la startup para la obtención de ventajas competitivas y que influirán decisivamente en la The Business Model “W” House: valoración de la empresa y en sus tokens a emitir. How much revenues and costs will a start up HOW MUCH? Revenues (+) / Costs (-)

generate to operate a business model? What are the product value propositions? Who are the customer segments that a start up aims to reach and create value?

WHAT?

HOW?

WHO?

Value Propositions

Distribution and Sales channels

Communication channels

Customer Segments

How a Value Proposition is delivered to a Customer Segment through distribution and sales channels ? How a Value Proposition is communicated to a Customer Segment through communication channels?

Intellectual Capital Economic “Intangibles” Human Capital

Structural Capital

Relational Capital

El Capital Intelectual es la combinación de los recursos humanos, organizativos y relacionales de una organización. La definición estas categorías son las siguientes: • El capital humano se define como el conocimiento que los empleados alquilan a sus empresas empleadoras. Incluye los conocimientos, habilidades y experiencias de las personas. Ejemplos: capacidad de innovación, creatividad, trabajo en equipo, flexibilidad, motivación, capacidad de aprendizaje, lealtad, etc. • El capital estructural se define como el conocimiento que permanece dentro de la empresa 105

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al final de la jornada laboral. Incluye las rutinas organizativas, procedimientos, sistemas, culturas, bases de datos, etc. Ejemplos: manuales, procedimientos, patentes, cultura corporativa, otros derechos de propiedad industrial e intelectual. • El capital relacional se define como todos los recursos vinculados a las relaciones externas de la empresa, con clientes, proveedores o socios de I + D. Ejemplos de esta categoría son las marcas, la lealtad de los clientes, los vínculos con los proveedores, el poder comercial, la capacidad de negociación con entidades financieras, etc. • El capital intelectual es más que la simple suma de los recursos humanos, estructurales y relacionales. Las empresas necesitan aumentar la interacción y la alineación entre estas tres formas de intangibles económicos, con el fin de crear valor. FOSOS ECONÓMICOS (MOATS = VENTAJAS COMPETITIVAS) Los modelos de negocio exitosos son aquellos que tienen la capacidad de generar ventajas competitivas sostenibles en el mercado, para ello se deberán contar con Moats o fosos económicos que protejan a la empresa de la acción de la competencia. Tener una ventaja competitiva sostenible significa que los clientes muestran fidelidad en la adquisición de productos y servicios a una empresa. Tales ventajas se pueden obtener de dos maneras: en diferenciación o cona estructura de costes reducida y muy competitiva. Warren Buffett acuñó el término Moat, que se refiere a las ventajas sostenibles que protegen a una empresa contra los competidores (la forma en que un foso protege un castillo). Los fosos son barreras a los competidores, además de contener características estructurales inherentes a un negocio. En este ámbito, los activos intangibles son fuentes de ventajas competitivas, cuya evaluación dependerá del valor que pueden crear a una empresa y la duración de éstos. Una marca es una barrera, ya que representa algo único y de valor en la mente de un cliente, lo que genera la lealtad de éste. Una patente valiosa o una concesión administrativa pueden generar protección a un negocio durante un tiempo, actuando tales intangibles como una barrera de entrada a los competidores. Los intangibles económicos, derivados de tales Moats, se basan en la búsqueda de una marca que tenga el poder de fijación de precios en el mercado, la aprobación de una concesión administrativa durante un tiempo o un conjunto diversificado de patentes, con un sólido historial de innovación de su poseedor. En este contexto, ser más eficiente que sus competidores pude resultar una buena estrategia, pero no es una ventaja competitiva sostenible a menos que se base en algún proceso patentado que sea difícilmente copiado. 106

Para Dorsey (2009), los inversores inteligentes deben concentrar sus inversiones en empresas con amplios Moats o fosos económicos, ya que estas compañías generan ganancias promedio superiores a sus competidores. En resumen, los fosos económicos aumentan el valor de las startups.

menos lo que se necesita para mantener y expandir su negocio.

Por ejemplo, el método de descuento de flujo de efectivo busca determinar el valor de la empresa estimando los flujos de efectivo que generará en el futuro y luego los descontará a una tasa Además, las compañías con Moats tienen mayor de descuento que se corresponda con el riesgo resiliencia, porque las empresas que pueden re- de tales flujos. currir a una ventaja competitiva estructural tienen más probabilidades de recuperarse de pro- Los métodos de descuento de flujos de efectiblemas temporales. vo se basan en el pronóstico detallado y cuidadoso de cada uno de los ítems financieros relaPROPUESTA DE VALORACIÓN DE cionados con la generación de los flujos de efecSTARTUPS SEGÚN MODELO ICBM tivo, correspondientes a las operaciones de la Una vez analizado en detalle los tres componen- empresa, como por ejemplo la recaudación de tes que forman nuestro modelo propuesto ICBM ventas, coste de materias primas, gastos de per(Capital Intelectual +Modelo de negocio + Moats sonal, etc. económicos) procederemos a la valoración de la startup que formula la ICO, con el propósito de En las valoraciones basadas en el descuento del validar la valoración financiera y las oportunida- flujo de efectivo, se determina una tasa de desdes que ofrecen los tokens objeto de este proce- cuento adecuada para cada tipo de flujo de efecdimiento novedoso de financiación. tivo. El hecho de que las empresas jóvenes tengan historias limitadas, que su financiación dependa del capital riesgo o el angel investing y sean particularmente susceptibles al fracaso, contribuyen a dificultar su valoración.

Equity Value = Cash Flow Discounting value + Growth Options value (generated by the Intellectual Capital involved in the Economic Moats).

El método de descuento de flujos de efectivo coLa mayor parte del valor de una empresa joven mienza con la siguiente expresión proviene de sus activos de crecimiento, la dificultad en la valoración de tales activos redundará en la valoración de la startup. Donde: CFi = flujo de caja generado por la comUn aspecto crucial en valoración de empresas pañía en el período i; VRn = valor residual de la lo encontramos en el valor terminal (como ve- empresa en el año n; K = tasa de descuento aproremos a continuación, en la fórmula), este re- piada para el riesgo de los flujos de efectivo. presenta una gran proporción del valor global de cualquier empresa; pero cuando hablamos de Un procedimiento simplificado para consideempresas jóvenes este valor terminal puede re- rar una duración indefinida de los flujos futuros presentar el 90%, 100% o incluso más del 100%, después del año "n" es suponer una tasa de crecimiento constante (g) de los flujos después de ese del valor actual de una empresa joven. período. Entonces el valor residual en el año "n" En consecuencia, las suposiciones acerca de es VRn = CFn (1 + g) / (k-g). cuándo una empresa alcanzará un crecimiento estable, un requisito previo para estimar el va- Dentro del modelo propuesto en este artículor terminal, tendrán un impacto sustancial en lo para valorar las ICOs exitosas, se detectarán, medirán y valorarán las métricas que permitan la valoración de una empresa joven. la integración y alineación de los tres conceptos En este proceso de valoración y análisis, Damo- esenciales (modelo de negocio, capital intelecdaran (2010) sugiere hacerse las siguientes pre- tual y fosos económicos). guntas: • ¿El arranque lo hará a un crecimiento estable? En la propuesta de expresión del valor patri• ¿Cuándo se convertirá la firma en una firma monial utilizaremos el valor Opciones de Crecimiento (generado por el Capital Intelectual invode crecimiento estable? • ¿Cómo se verá la empresa en un crecimiento lucrado en los Fosos Económicos) como alternativa para capturar la incertidumbre generada por estable? la dinámica empresarial y flexibilizar el plan fiEn resumen, nos resulta difícil estimar el cre- nanciero establecido en el Flujo de Efectivo Mécimiento futuro de los ingresos y los márgenes todo de descuento. operativos de las empresas jóvenes. Identificaremos y valoraremos las métricas Una vez realizada esta introducción, en relación de Opciones de Crecimiento contenidas en el a las dificultades que encontramos en la valora- White paper y en la documentación relevanción de startups o proyectos empresariales que te presentada por la empresa en el proceso de acuden a ICOs a financiarse, podemos definir, a ICO, para ello mostramos a continuación una guía de ayuda en la detección de métricas de grandes rasgos, en qué consiste tal valoración. Capital Intelectual para su posterior valoraUna startup vale el valor actual del efectivo que ción, según la formulación expuesta anterioresperamos que genere ésta durante su vida útil, mente.

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Es fácil ver la problemática en la valoración de las empresas jóvenes: Hay pocos o ningún activo material; Casi todo el valor proviene de las expectativas de crecimiento futuro. Los estados financieros actuales de la firma no proporcionan ninguna pista sobre los márgenes potenciales y los retornos que se generarán en el futuro, además hay pocos datos históricos que puedan usarse para desarrollar medidas de riesgo. Además, estas startups suelen depender de una o unas pocas personas clave para su éxito, por lo que perderlas puede tener efectos significativamente negativos en el valor. Hay una serie de cosas que cada nuevo ICO debe tener: el equipo directivo, una hoja de ruta disponible y un Libro Blanco (explicación de los detalles del proyecto ICO), información de gestión y un sitio web de aspecto profesional.

GUÍA DE DETECCIÓN DE MÉTRICAS DE CAPITAL INTELECTUAL EN LA VALORACIÓN FINANCIERA DE ICOS Mientras que el mercado de las ICOs siga siendo el predilecto, por sus altos rendimientos, por la comunidad inversora más especulativa en los próximos meses, estaremos expuestos al riesgo de posibles fracasos e inclusive, estafas. Los cuales hay que prevenir, como ya sucedió en los 2000, con la crisis de las puntocom. Para estar prevenido y llevar a cabo las inversiones más acertadas en criptoactivos hemos elaborado esta pequeña guía para la inversión inteligente en ICOs, la cual permitirá tomar decisiones basadas en la detección y análisis de las métricas clave de capital intelectual, las cuales habrá que buscarlas en el White paper, la página Web y otra documentación relevante presentada en proceso de la Initial Coin Offering, atendiendo al guion esbozado en nuestra metodología propuesta ICBM. Partimos de que cada negocio comienza con una idea. La idea germina en una necesidad del mercado que un empresario detecta y pretende satisfacer. La mayoría de las ideas no suelen ir a ninguna parte, pero algunas personas toman el siguiente paso de invertir en la idea. Tenemos que ser cautelosos de ver que la ICO que estamos valorando no es una simple idea sino un modelo de negocio bien estructurado, dotado de sólidas ventajas competitivas sostenibles (moats). En la etapa de la idea, el valor nunca puede ser puesto en el papel, pero es el potencial de este valor que induce al empresario a invertir tiempo y dinero en el desarrollo de la idea. El capital para financiar la inversión generalmente proviene de fondos personales (de ahorros, amigos, tontos y familia) y en el mejor de los casos, produce un producto o servicio comercial. Asumiendo que el producto o servicio encuentra demanda en el mercado, el negocio necesitaría tener acceso a más capital. Es aquí donde la selección de una ICO como fuente de financiación se podría llegar a materializar, y es aquí donde hay que detectar las potencialidades

Modelo de negocio y Viabilidad comercial Hay muchas soluciones, productos y servicios disponibles en el mercado que nunca necesitay oportunidades de mercado que ofrece tal ICO, rán o se beneficiarán de la tecnología blockchain. con la ayuda de nuestro modelo ICBM. Para la adopción del mercado en un amplio segEn la documentación facilitada en la ICO pro- mento hay que plantearse la simple pregunta: cederemos a valorar y a cuestionarnos, aspec- "¿Cree que el producto o servicio de la empresa será tos como: el modelo de negocio propuesto y la un éxito comercial?" proposición de valor diferencial; el capital intelectual implícito en el proyecto empresarial; los Para la respuesta a esta pregunta le sugerimos diversos apartados que forman el White paper; que utilice, y responda, a las preguntas contela capacidad de gestión, ejecución y liderazgo del nidas en el apartado de “modelo de negocio” d equipo directivo; etc. nuestro modelo propuesto ICBM. Para la detección de métricas de Capital Intelectual nos haremos una serie de preguntas que nos den pistas de los posibles intangibles que podemos encontrar en las ICOs, con potencial de generación de ventajas competitivas sostenibles, en un marco de modelo de negocio rentable y competitivo. A continuación, pasamos a hacernos las cuestiones oportunas a la documentación facilitada en la ICO: Capital Inteletual Según Damodaran (2010), tenemos que hacernos las siguientes preguntas sobre la valoración de las empresas con Activos Intangibles: • ¿Cuáles son los flujos de efectivo de los activos existentes? Los gastos de capital asociados con la adquisición de activos intangibles se clasifican erróneamente como gastos operativos, lo que lleva a ganancias contables incorrectas y de medidas del capital invertido. • ¿Cuál es el valor añadido de los activos de crecimiento? Si los gastos de capital se clasifican erróneamente como gastos operativos, se hace muy difícil evaluar cuánto se está reinvirtiendo una empresa para el crecimiento futuro y cómo de bien se están haciendo las inversiones. • ¿Cómo de riesgosos son los flujos de efectivo, tanto de activos existentes como de activos de crecimiento? Suele ser más difícil apalancar activos intangibles que tangibles. El riesgo en las operaciones puede cambiar dependiendo de la estabilidad del activo intangible.

Una vez que hemos respondido a las preguntas que se formulan en el modelo de negocio, las complementaremos con la siguiente lista de chequeo de la propuesta de valor contenida en tal modelo de negocio a analizar: • Es difícil de copiar? • ¿Supera sustancialmente la competencia? • ¿Se enfoca en trabajos insatisfechos, problemas no resueltos y ganancias no realizadas? • ¿Está alineada tal propuesta con la forma en que los clientes miden el éxito? • ¿Se enfoca tal propuesta en los quehaceres del cliente, sus problemas o las ganancias esperadas de un gran número de estos o para un pequeño número que está dispuesto a pagar mucho dinero? Si usted entiende la tecnología y el principio subyacente de la empresa, entonces es hora de seguir haciéndose las siguientes preguntas: • ¿Está realmente listo el mercado para este producto/servicio objeto de tal ICO? • ¿Ve esta tecnología siendo utilizada en el futuro por el mercado objetivo? • ¿Hay competidores haciendo lo mismo? • ¿Crees que la empresa puede realmente construir y entregar lo que están diciendo? • ¿Cuáles son las amenazas asociadas a este producto/servicio? • ¿Los clientes objetivo utilizarían realmente este producto/servicio? • ¿Los clientes realmente pagarían por ello? Equipo directivo y Consejo asesor El mercado de las ICOs ha generado una cantidad significativa de empresarios oportunistas 107

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que buscan una financiación fácil, de los cuales que se necesita para la consecución de objetivos hay que huir. y metas. Si en la documentación de la ICO esto no queda aclarado debemos incrementar nuesEsta es una lista de verificación para validar el tras precauciones. equipo directivo y su consejo asesor: • La dirección y el equipo asesor tienen conoci- Si el ICO está analizando menciones, ningún mientos suficientes y contrastables, en su sec- plan futuro de comercialización considera esto tor de actuación específico. • Hay un equilibrio de competencias técnicas, En resumen, es de vital importancia que el plan empresariales y comerciales del personal di- de negocios destaque no sólo la estrategia técnirectivo y asesor involucrado. ca planeada, sino también la estrategia comer• La experiencia y las competencias del equipo cial y de mercado. directivo y asesor pone en valor a la ICO. En un plan comercial, lo que necesitamos saber Roadmap es: Un cronograma detallado y una hoja de ruta con • ¿Existe una estrategia de marketing? la distribución temporal de hitos debe de dar la • ¿Cuándo se va a lanzar? suficiente confianza al inversor. • ¿Cómo van a comercializar el producto/servicio? Esta es una lista de comprobación para validar la • ¿Cómo es su plan de distribución y logístico? hoja de ruta presentada en la ICO: • ¿Están buscando socios estratégicos para im• ¿Dónde va la empresa y cuál es el propósito de pulsar la adopción del mercado del negocio? esta? • ¿Cómo van a conseguir sus primeros usuarios • ¿Cuándo es la próxima actualización tecnolóo clientes? gica? • ¿Cuándo esperan asegurar canales de distri- Como adelantábamos antes, debe haber una hoja bución? de ruta bien pensada, que incorpore los planes para el desarrollo técnico, el lanzamiento comerEsta hoja de tura debe de estar bien alineada con cial y una estrategia de penetración de mercado. lo propuesto en el White paper. También es importante que se mencione cómo White Paper se gastará realmente el dinero recaudado. Este documento suele tener una estructura y formato similar a los papers de investigación, Hay que asegurarse del reflejo conciso del presupero a estos además hay que exigirles las necesi- puesto, en donde se asignará el capital y los gasdades que satisface un libro de venta similar a las tos operativos. Es importante pasar un tiempo empresas en procesos de IPOs. serio analizando tal distribución propuesto del presupuesto, para entender exactamente dónde En estos White papers se muestra cómo funcio- irá el capital captado con la ICO. nará la aplicación y su plataforma tecnológica, cómo se pueden obtener beneficios articulando CONCLUSIONES un modelo de negocio y cómo se articula los pla- La inversión en ofertas iniciales de monedas nes del proyecto emprsarial presentado (comer- continuará siendo una forma significativamente cial, técnico, estratégico, etc.) rentable para que los inversores accedan a mercados nuevos e innovadores dentro del ecosisteLos White papers son generalmente un docu- ma de la moneda criptográfica. El análisis de la mento muy detallado que consta de los siguien- empresa requiere cierto aprendizaje y práctica. tes apartados: La capacidad de filtrar, de examinar y de anali• Capital Humano zar tales oportunidades a esta extensión bási• Visión general de la empresa y plan de opera- ca demostrará ser un proceso rentable y de alto ciones rendimiento dirigido para aquellos que ponen su • Análisis estartégico. Macro y microentorno. mente a él. • Modelo de negocio y Propuesta de valor diferencial En este contexto, es muy útil emplear el mode• Descripción del funcionamiento de la tecnolo- lo propuesto en este artículo (ICBM). Esta herragía y de la aplicación mienta permitirá analizar las ventajas competiti• Estrategia de comercialización (mercado) vas generadas por el capital intelectual de la joven • Hoja de ruta del producto empresa objeto de nuestro estudio, además de va• Utilización del producto lorar el equity de la startup objeto de la ICO. • Estructura de la oferta de tokens • Presupuesto postventa de tokens Con el modelo ICBM hemos propuesto, para su aplicación práctica, de una guía para encontrar En este documento, estamos buscando una ex- métricas de capital intelectual en ICOs, donde plicación clara y concisa de lo que hace la empre- destacamos el exhaustivo análisis que debe hasa: cada buen concepto de negocio debe ser ca- cerse al modelo de negocio y principalmente a su paz de ser comunicados o explicados en menos propuesta de valor diferencial. Para ello, es esende dos frases. cial conseguir respuestas sólidas a las siguientes preguntas: En algún momento dentro del documento, usted • ¿En qué consiste la propuesta de valor difedebe ser capaz de entender cuáles son los objetirencial del proyecto implícito en la ICO? vos de negocio, cómo lo están desarrollando y lo • ¿Cuáles son los segmentos de clientes que se 108

pretenden alcanzar y cómo proporcionarles valor? • ¿Cómo se comunica, de manera efectiva, la existencia de esta Propuesta de Valor a un a los segmentos de clientes seleccionados? • ¿Cómo hacemos disponible tal Proposición de Valor a nuestros clientes objetivos? • ¿Cuántos ingresos, costes y beneficios generarán la ejecución de este modelo de negocio? Estamos ante las denominadas B-Finance (= criptografía + innovación + descentralización) que han venido al mercado, como fuente de financiación empresarial para quedarse; para entender esta afirmación sólo hay que fijarse en las cifras que se manejan enb el mercado global, con una capitalización total y actual de criptoactivos que superan los 150.000 millones de dólares. Ante los retos que plantea estas nuevas finanzas es fundamental contar con una herramienta que permita ayudarnos en la gestión y valoración de los proyectos empresariales que están detrás de estas ICOs, para no volver a cometer los errores que sufrió el mercado en la crisis del 2000 de las puntocom. El objetivo con este artículo y con la propuesta de nuestro modelo ICBM es dotar de herramientas de análisis y de valoración efectivas a los inversores en el ámbito de las criptomonedas, para la toma de decisiones inteligentes y con fundamento. Los ICOs se encuentran en una zona peligrosa donde la Comisión de Valores y Bolsa de los Estados Unidos (SEC) y muchos otros organismos reguladores siguen investigándolos. El problema principal es, sin embargo, que la mayoría de las starups que emplean como financiación ICOs no ofrecen realmente Equity como securities (títulos valores) vía token. En cambio, sólo ofrecen descuentos en las preventas de los productos/servicios a ofrecer. Es por ello, que al no encajar la definición técnica del token, objeto de la financiación ICO, con el de security que manejan los organismos regulatorios como la SEC, suelen quedar fuera del marco regulador establecido para los títulos valores. Además, los critoactivos son instrumentos de carácter mundial, no nacionales, financiándose con bitcoin, éter y otras criptomonedas que no están controladas por ninguna autoridad o banco central. Cualquiera puede invertir, e incluso puede hacerlo pseudo-anónimamente. BIBLIOGRAFÍA Damodaran, A. (2010): “The Dark Side of Valuation: Valuing Young, Distressed, and Complex Businesses “; FT Press. Dorsey, P. (2009): “The Little Book That Builds Wealth: The Knockout Formula for Finding Great Investments (Little Books. Big Profits) “; Wiley; 1 edition Osterwalder, A.; Pigneur, Y.; Bernarda, G.; Smith, A. (2015): “Value Proposition Design: How to Create Products and Services Customers Want”; Wiley; 1 edition. Santiago, I (2017): “La Revolución de la tecnología de Cadenas de Bloques en la economía: Impacto en los distintos Sectores Económicos“; Editorial Académica Española.

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