- We’ve heard a lot about BANKEX since you often speak at conferences. The company has successfully completed the token sale. What do you already have and what do you plan to build with the attracted funds?
In general, business owners in a certain industry, such as metallurgy or car manufacturing often suffer from cash shortage or lack of liquidity. Meanwhile, they are sitting on assets. To free up the money and get floating capital, we invite them to buy our tokens. Tokenization of assets will subsequently allow these companies to use our service. And many people buy a significant number of tokens.
So, how does it work? Our processors are similar to the securitization of a real banking menu. Most importantly, our know-how is not the blockchain itself, but an off-chain, which combines blockchain with other technologies. We create a process that transfers reliable and verified data to the blockchain.
Our approach is unique in particular cases: we investigate what exactly can be used to collect data about an asset. For example, machine learning technology that collects data from sensors. The goal is to eliminate human factors and possible frauds. Do not expect the mine owner will honestly tell how much coal is being extracted, because he is interested in numbers, a lot of things depend on them. Therefore, it is necessary to obtain these data from sensors installed on trolleys and automatically read how much coal is mined every day. Another example is data collection by a third-party company that installed its software, which you can trust. The third example is to use the data of a foreign company that is also working on this mine, as well as many others around the world, without the participation of the mine owner. This player can be trusted because the company values its brand.
We provide money to ensure the cash flow of the mine regardless of who owns it. If the ownership of the mine is transferred, all the cash flows or debts will fall upon us. This tool is the tokenization of assets, and we are willing to use it.
We are like Goldman Sachs on the blockchain. As platform owners, we will profit from each transaction.
Our first partner is the Hollywood producer Christopher Woodrow. We are building a joint Moviecoin platform, which will be used to finance movies. This fundraising site is for movies that are used to be produced by Hollywood studios that have tens of millions dollar budget.
Moviecoin will be presented in May 2018 at the Cannes Film Festival. I’ve already been invited to the red carpet. There are a number of well-known producers and directors supporting this platform, which will raise 100 million dollars for its development and initial investment in movies. Then it will raise billions – simply because every year the Hollywood film industry attracts 5 billion dollars. The platform will allow you to create a standard on which investors can invest in blockbusters with minimal losses. It is well known that now the studios operate in a way that causes all the newcomers in Hollywood to lose money. Our goal is to reduce investment risks for newcomers in Hollywood through Moviecoin tokens.
- What role does BANKEX play in building this film production platform?
Moviecoin platform will use BANKEX tokens in the same way as smart contracts on Ethereum use “gas”. This means that 10% of the commission collected on this platform will be for purchasing BANKEX tokens. Thus, all owners of BANKEX tokens will get buyers from this platform.
Moviecoin is only the first platform we build. In the future, there will be about ten. The next platform, which we think will be designed to fund musicals in Hollywood. Then, a mortgage securitization platform will be launched. In this plan, we also consider the prospect of the secondary market for private shares. In all the areas I just mentioned, we already have clients.
We build a range of these assets. Our goal is to provide each asset with liquidity. The ultimate liquidity lies in the exchange. On our platform, we will build a bridge connecting capitals from the stock exchange with blockchain instruments. A tool like the one used for securitization will be created. That means a SPV will be made. Maybe there will be a Special Purpose Acquisition Company (SPAC), which will be listed on the stock exchange and provided with tokens generated on the basis of our protocol, in particular through Moviecoin.
- And which stock exchanges are you considering?
NYSE, New York – I intend to make the company global immediately. I invited to advisors experts who created SPAC 20 years ago. SPAC allows, for example, taking 3 million dollars to raise 50 million in the private market for acquisitions and further development. We give a year to purchase purposes. After the acquisition, the company will become public – i.e. listed on the NYSE.
This is a specially designed artificial method that gives an opportunity to people who have many years of experience in the industry, using small financial means, to immediately gain market confidence and capitals to purchase companies. So you can more effectively manage existing private companies by making them public. We and our advisers will establish a mechanism for creating blockchain assets on the capital markets.
- Your token costs about 500/ETH. How did you set this price?
We have an understanding of how many tokens we need and what kind of capitalization is needed. We split this capitalization by the number of tokens and chose the unit of measurement. We proceeded based on our understanding of the market price: as a rule, when issuing the tokens, there are several tens of cents, and we tried to set prices in the same area. When we launched, Ether was much cheaper than now – the exchange rate was about $ 200/ETH. And then it was about 55 cents for 1 token. After the token sale, the price is depending on exchanges.
- How many tokens do you release?
We have 400 million tokens. 220 million goes on sale – it’s 55%. Among this 220 million, 80 million – for retail token sale and 140 million is for institutional buyers. This means that our platform is aimed primarily at institutions, which will use our tokens to tokenize their assets and their clients’ assets.
Small buyers can also use their tokens to tokenize their assets. It’s not necessary to create different protocols for different platforms, they can use the existing tools for their assets.
Among the existing tools, there is a basic contract for asset tokenization, a contract for hedging the cost of Ether. In the near future, there will be quite a lot of derivative contracts.
The difference between institutional tokens and retail ones lies in the fact that institutional ones cannot be resold within a year. They can only be used for their intended purpose, namely: as a “gas” for asset tokenization. The minimum contribution is one thousand ETH. Thus, these tokens will be bought by institutional clients, who need the tokens for future work. Someone can buy them for the purpose of resale, but the person has to wait for a year to do that.
- Does the value of your tokens depend on the price of Ether?
They are correlated with Ether. In fact, this means that if the price of Ether increases, then our tokens also grow in fiat. If it declines, our tokens in fiat also decline. But this is only during the time when the tokens are released. We will continue our own path, the value of our tokens will depend on capital inflows and real assets on which our platform is based. In this regard, the price of the token will depend on the turnover of those platforms, rather than the price of Ether.
- For example, if there is an exposure on one of the mines owned by your clients, is the value of your tokens going to drop?
We benefit from providing tools to people and businesses. Our profit comes from helping them to get funding, not their products or how they operate.
- Does it mean if the movie tanks at the box office, you are not affected?
This can reduce the demand and credibility of the protocol. However, in the moment we profit from the fundraising committee, the film, having raised money on the Moviecoin platform, will have to pay an average 4-6% for the token releasing. This is the average commission in the market where funds are raised from bankers. But it is lower than the cost most companies have to pay for launching their own token sale.
BANKEX will become a safe haven for crypto-investors because our revenues and our supply of demand will be based on the real sector. This is similar to the principle of gold reserves. Perhaps, crypto-funds will even keep portfolios from us, because we diversify the risks.