Blockchain Blitz Whitepaper on:
The Rock Token (RKT) - Exchange token of the Gibraltar Blockchain Exchange (GBX)
*Full disclosure & disclaimer: I am an investor in The Rock Token. This article shares only my observations and thoughts and, as always, I try to be as objective as possible. I am not a financial advisor. Always do your own research.
Website: https://gbx.gi/
Whitepaper: https://gbx.gi/token-sales/GBX-Whitepaper.pdf
SUMMARY
The Gibraltar Blockchain Exchange (GBX) is the recently-launched subsidiary of Gibraltar Stock Exchange (GSX) – an EU regulated Stock Exchange. “For the first time ever, a regulated stock exchange is stepping into the blockchain space to offer much-needed guidance and standards by bridging the gap between traditional finance and next generation technology to usher in a new era of blockchain powered finance.” (GBX Website)
GSX/GBX is located in Gibraltar - a British territory, although it is technically off the southern tip of Spain, in the Iberian Peninsula. Gibraltar is unique in many ways but most notably for being almost completely self-governing. Gibraltar’s status is particularly attractive to financial institutions, as Gibraltar has special tax breaks and incentives for banking and international business. They currently have the 5th most banks, per capita, in the entire world.
Why is this significant?
Given the concentration and specialization of financial services in one small location, one could argue that Gibraltar knows more about financial services and regulation than most geo-authorities in the world. Cryptocurrency exchange is a financial service.
There are SO MANY cryptocurrency exchanges. What makes GBX unique?
- As stated, this is the first time a government-regulated stock exchange is stepping into the cryptocurrency space. This cannot be overstated. This means that GBX will be light years ahead of all other crypto exchanges in so many ways – namely: CUSTOMER SERVICE (basic customer service is lacking everywhere in crypto), asset safety & security (hacking, glitches), protection from ICO fraud, protection from fraudulent coins (Ponzis, Pyramids, scams), tax reporting, fiat gateways/liquidity, access to tokenized securities, transparency, to name a few things. Most of these things are lacking for global crypto traders in EVERY exchange (except Quoine/Qryptos – I’ll touch on that later).
- Token Listing Standards – they will be the “gold standard” as far as listing a coin on their exchange. The “BitConnect” coins (Ponzi Schemes) of the world will not make the cut.
- ICO standardized process with due diligence. Formalized ICO due diligence is also something that is lacking with every exchange.
- Tokenized Securities. (see below)
Have you ever wondered why you can’t talk to anyone on the phone at your favorite exchange, to resolve an issue? Have you ever wondered why there are no Headquarters/addresses listed anywhere, and you can’t even find an office location?
Doesn’t that make you uneasy? It does for me and it should for you. One reason: Accountability. If something goes wrong, do you have any recourse? GBX/GSX is in plain view for everyone to see. They are not hiding behind a curtain somewhere in the world, ready to up-and-leave with your coins if things get bad, like a hacking or a government takeover (happened in China and Japan and will be happening all over the world this year).
The Rock Token is a utility token and “currency of choice’ for operating within the GBX platform, which is expected to go live in April.
There are SO MANY exchange tokens. What makes The Rock token unique?
That’s where things get exciting. We have discussed how regulated exchanges are the legitimacy the industry needs. The Rock Token actually has more utility than any other exchange token out there to my knowledge. Utility equals demand, plain and simple. And demand equals a higher and higher price.
USE CASES/ UTILITY FOR THE COIN
- Listing Fees – to list your coin on GBX, you will need to pay in RKT
- Trading Fees – RKT can be used for discounted trading fees on GBX
- Sponsor admission – for ICOs to issue on their platform, they must go through a due diligence process performed by their GBX assigned Sponsor. Sponsors will need to purchase RKT to participate and “RKT will be the only accepted means of payment for Sponsor Fees.”
- Sponsor/ Token Issuer staking: “each Sponsor will stake a fixed amount of Rock Tokens (to be held in GBX escrow) for 12 months, equivalent to 0.5% of the total tokens issued through each token sale that they are sponsoring and which are admitted to trading on GBX.”
- RKT holders will be allowed early admission and participation in ICO private and pre-sales on the GBX platform
- RKT to be charged for corporate services (already operational)
- RKT to be charged for ecosystem business solutions (already operational)
- E-money institution (currency) (launching in 2018)
- RKT for fund services (already operational)
- RKT for priority coin listings
- Voting rights on select community developments
- RKT holders may be able to acquire future releases of RKT from the GBX reserve at a discount to the market rate
- Additional exclusive discounts
The Rock Token ICO
Completed in February, the bulk (258,556,250 RKT) went to Private investors – 50% of these tokens are locked up and released monthly over 6 months. The remaining RKT that was available to the public (60m RKT) sold out in 9 seconds. There was also a bonus of 10-25% during the private sale for strategic investors.
The total amount sold during the ICO was ~319m tokens at a price of $.10 USD. The total hard cap was $27M.
COIN TECHNICALS
The Rock Token is an ERC20 compliant token built on the Ethereum blockchain and GBX is a member of the Enterprise Ethereum Alliance. The total supply of coins is 900m. 246M are held in reserve for “further development and stability of the ecosystem.” 95m for community development, partnerships and securing liquidity. 123m for founders and staff (locked-up for 1st 6 months and then released every quarter for 3 years). 117m for early backers, partners and advisors (6-12 month vest).
- Currently trading on Qryptos/ Quoine and IDEX
- Current circulating supply, verified by GBX= ~342m RKT
- Current MC= ~$39M ($.1132 per coin on Coinmarketcap.com).
TEAM / LEADERSHIP
The term “all-star team” is thrown around a lot in crypto. That term would be an understatement for this team.
Nick Cowen (Group CEO) – head of GSX; 18 years at ING Barings as Global Head of Equities Trading. Previously Manager Director at Bear Stearns UK. https://www.linkedin.com/in/nick-cowan-00a1a439/
Philip Young (Group Marketing Director) – CFA, 20+ yrs experience in financial services, 5 yrs with GSX
https://www.linkedin.com/in/philip-young-189312a4/
William Rawley (Group Legal Counsel) – Former Director at both BNP Paribas and Citibank.
https://www.linkedin.com/in/william-rawley-b83b1958/
Adrian Hogg (Group CFO) – former Partner at Grant Thornton (Top 5 global accounting firm), former Controller at Bank of the East. https://www.linkedin.com/in/adrian-hogg-3561b5153/
Thoughts on Leadership:
Show me another cryptocurrency exchange with this level and quality of experience. People with resumes like this do not put their names on the line for something that might not work.
ROADMAP
Plans for the future are outlined on the website.
PEERS/ RELEVANT EXCHANGE TOKENS WITH TRUE UTILITY
GBX: The Rock Token (RKT)
- Current MC: ~$39M
Qryptos/Quoine: QASH
- MC: $232M; ATH ~$840M (Jan 2018)
- Coin uses: as a payment for services on the platform, trading pairs, discounted fees (5% off)
- QASH is the closest comparison to RKT. Quoine was the first fully state-regulated crypto exchange (Japan) to come on the scene. So far, I’ve been pretty impressed with them, although they do have some kinks to work out. Their most exciting offering – the “Liquid” World Book – is slated to go live in the coming weeks. I believe that Liquid is going to be the first gateway for institutional players and governments to come into cryptocurrency. I would strongly urge researching them further. I have recommended them in the past, and still do, but there is only so much time in the day to write whitepapers.
- https://medium.com/@QUOINE/qash-and-the-qash-blockchain-b8fb922994a4
- Referral link: https://accounts.qryptos.com/sign-up?affiliate=qnPCfqpF92503
Binance: Binance Coin (BNB)
- Current MC: ~$792M; ATH ~$2.3B (Jan 2018)
- Coin uses: discounts on trading (50% off currently), voting rights, trading pairs, discounts on promotions, early access to ICOs, airdrops.
- Binance will buy back and burn BNB, ultimately reducing the total in circulation and likely increasing the price
- My take: Binance is currently my favorite exchange platform – although this is a fluid thing. Binance is well run, fair, more transparent than most other exchanges (although full transparency still lacking), easy to use, has great record with security, pays coin forks, and they have an ICO incubator.
- I believe The Rock Token will be a better coin than BNB ultimately. It has more utility on a more trustworthy, regulated platform.
- BNB vs RKT: BNB’s current market cap is roughly 30x RKT’s. And this is in a down market. It’s about 80x from all-time highs.
- Referral link: https://www.binance.com/?ref=10126633
Kucoin: KuCoin Shares (KCS)
- MC: $304M; ATH ~$1.8B (Jan 2018)
- Coin uses: discounted trading, trading pairs, voting rights, airdrops, most importantly/ differentiator: they pay dividends to KCS holders in the form of coins on their platform.
- My take: Kucoin is a great platform and currently my 2nd favorite. They’re a strong up-and-coming player and in my opinion, the biggest threat to Binance.
- My same thoughts on KCS vs RKT, as far as which coin has more utility and is more secure.
- Referral link: https://www.kucoin.com/#/?r=1sbN7
Thoughts on these Exchanges and their Exchange Tokens:
These are the top comparisons to RKT in my opinion. Yes, there are other exchange coins out there, but I don’t believe any others to be in the same league at this point in time.
QASH would be the best comparison to RKT, although I believe RKT has more utility than QASH. However, QASH’s “Liquid” is going to open a floodgate of new money coming into crypto, so the QASH coin will always be in demand for the years that follow. RKT doesn’t have the Liquid World Book but they will be providing Tokenized Securities – which gives them their unique advantage and also opens the floodgates for additional capital. The regulated ICO platform that GBX/RKT will offer also makes them particularly appealing. This is the direction the market is heading in.
Even without Liquid and without Tokenized Securities/ICO due diligence, these coins would be good speculative investments simply due to their promise of stability and asset security. But both of these platforms offer additional features that positions them to capture the “big money” when it comes (I think it will truly start in the 2nd half of 2018).
The only of the peer exchange tokens above that is regulated is Qryptos/QASH. I believe that eventually all non-regulated exchanges will be removed from the “big player” equation. So, either they get regulated or they will lose their market share. When mass adoption comes, experienced and conservative investors will require security, safety, accountability and transparency with their investment capital.
When regulation gets fully implemented, the only exchanges left who are unregulated will be the “dark alley” exchanges where you can trade at your own risk, and OTC (Over the Counter) exchanges where you can trade P2P (also with a high degree of risk).
Flash forward 1 year: I believe that GBX/RKT will be the preferred exchange for Western investors and that Qryptos/QASH will be preferred for the East.
RISKS
- The GBX exchange is expected to go by April. Risks would include working out the kinks and bugs for a new exchange and their ability to adapt to the blockchain world.
- There is a chance their application for regulatory approval will be denied. I would say that is unlikely. If it was another exchange, without their history as a Stock Exchange and without their connections, I’d say there is a significant risk there. However, these are not the type of people who put time and money into something if there are relative uncertainties.
FINAL THOUGHTS
Regulation for cryptocurrency exchanges is coming. Typically, the United States leads the way when it comes to regulation, and the world follows.
The United States SEC Chairman recently stated: "I believe every ICO I've seen is a security.”
The US Financial Crimes Enforcement Network (FinCEN) published a letter recently that indicates they seek to regulate ICOs. Dozens of subpoenas were issued to US funds and companies who have issued ICOs. They wrote: "a developer that sells convertible virtual currency, including in the form of ICO coins or tokens, in exchange for another type of value that substitutes for currency is a money transmitter and must comply with AML/CFT requirements. An exchange that sells ICO coins or tokens, or exchanges them for other virtual currency, fiat currency, or other value that substitutes for currency, would typically also be a money transmitter."
This means that both cryptocurrencies AND exchanges will be required to register as “a money transmitter” and comply with Anti-Money Laundering (AML) and Know-Your-Customer (KYC) standards.
Regulation is coming, friends, and it will be here in 2018.
We are already seeing ICOs that are only taking Private Placement money. Soon, all ICOs will be “private only” and not open to public fundraising, for fear of regulatory reprisal.
In addition to the above points, the thing that really excites me about GBX and The Rock Token is the fact that they will be the first to issue “tokenized securities.” To be a successful crypto investor, you always need to think three steps ahead. If you believe that tokenized securities are the future addition to the cryptocurrency world, as I do, GBX is the best positioned to capitalize as the first to act in the space. There are others with plans to enter, but GBX are already experts at equity trading and compliance unlike the others. For companies wishing to go public (through an IPO), one of the main selling points for middlemen brokerage houses is their ability to attract investors and source capital. With tokenized securities, middlemen won’t be necessary. One of the amazing attributes of crypto is that ANYONE, ANYWHERE with an internet connection can purchase it. This opens up an IPO (or an ICO in lieu of an IPO) to a global audience of potential investors. Coins or Tokens, as the new preferred unit of stock, are investable and tradable to everyone, globally. Not just investors with Merrill Lynch or Schwab or ETrade or another broker. Anyone, anywhere in the world can be an investor in a project. That is revolutionary for a company seeking investors.
Coins that are less about currency and more about utility are less volatile, less speculative.
As far as exchange tokens go and relative to their current Market Cap of only $39M, the author believes RKT to be the lowest risk exchange token play on the market, by far.
Things are still very early for GBX. We believe The Rock Token value will increase as they start to onboard new coins to their platform. More coins = more new users = greater demand for the coin.
We believe this coin to be very undervalued as of today but also that it has potential for incredibly high upside in 2018 and beyond.
Thanks for reading! Comments/suggestions/insights welcome!
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NOTE: Currently, due to uncertainty around securities law, residents of the following countries are not eligible to join the GBX platform: United States of America, China, Republic of Korea, Japan, all U.N. Sanctioned Countries. However, for those countries, RKT can be purchased on Qryptos and IDEX.
If you would like to open an account on the above exchanges (all are recommended as strong exchanges) please use my referral code, as I’ve received no compensation for sharing my research.