Bringing Fiat and Crypto Together For A Turnkey Tokenized Investment Platform.
The new economy of virtual currencies and blockchain technology has naturally given rise to some sophisticated new ways to invest. The most obvious example of this is the Initial Coin Offering (ICO), which is similar in principle to the old-school Initial Public Offering (IPO), but with a couple of significant differences. First, an IPO seeks cash revenue through the sale of shares, and secondly, IPOs exist within a marketplace in which companies must prove to investors and to regulators that all is ship shape.
ICOs, by contrast have proven to be a rocky area to do business. It is a virtual trading floor that is still technically brand new and has not yet matured. Many initial coin offerings (ICOs) have proven to be fraudulent, while others have been perfectly legitimate, but have suffered sabotage and theft due to unforeseen technical glitches. Detractors and defenders will say much of this has to do with people not fully understanding the difficulties of offerings done through virtual portals using virtual money. Hackers, it seems, are always one step ahead, ready to exploit the tiniest flaw in the code or the procedure.
Secondly, ICOs trade for tokens, which sit somewhere between shares and coins in terms of their liquidity and connection to the issuing company. Tokens are central to the blockchain/Ethereum marketplace, and are becoming more and more mainstream.
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Thirdly, excitement and enthusiasm have taken over from common sense and sober second thought. People reach for their bitcoin wallets and press “Send” moments after reading a start-up’s white paper. The notion of careful analysis and due diligence get lost in an environment where one’s own Ethereum holdings could climb by ten or twenty percent in minutes. Speed is of the essence.
However, this year alone, 92 companies have raised more than $1.2 billion through ICOs, and investors remain keen to see how they can best profit legitimately from this industry. There is a need for structure, legitimacy, and transparency, and walking onstage to answer this call comes Black Moon Financial Group, a financial technology and investment management company founded in 2014. With offices in Moscow, New York and elsewhere, it is responsible for IT, compliance, licensing, and bank partnerships.
The Blackmoon Crypto Platform promises a better solution for professional investors and their clients. It offers a blockchain-based platform for tokenized vehicles, which help asset managers to create and manage legally compliant tokenized funds.
What are Tokenized Funds?
When companies launch their ICO, they issue crypto tokens in exchange for investment cash. The tokens are built on top of the blockchain platform, and their owners can trade them as they wish.
Sergey Vasin, Chief Investment Officer of Blackmoon points out, “Tokenized funds are more cost-efficient thanks to lower infrastructure and setup costs…This economy is transmitted to investors in the form of higher net return. For the cherry on top, fund tokens are also immediately tradable.”
This new economy gives rise to two major opportunities. First, the token-based investment process should be more transparent and auditable due to its blockchain roots. Secondly, this improved “open book” approach offers the potential to expand the market beyond cryptocurrencies and incorporate fiat currency into the portfolio.
How Does blackmoon crypto Help?
Blackmoon delivers structure and process. Through Blackmoon Crypto, and with the backing of its well established financial group, the company creates an essential turnkey offering, looking after everything from technology and infrastructure through to legal framework and corporate structuring. As they themselves state, the Blackmoon Crypto Platform’s usability will allow any experienced investment manager to create a fund based on it.
Oleg Seydak, CEO of Blackmoon Financial Group, points out that many tokenized funds fail to set up a proper structure, and this leads to greater regulatory risk for investors. Blackmoon seeks to define the industry standard for setting up tokenized investment vehicles, with participation from both fiat and crypto worlds being central. The package is there for any qualified asset manager to build upon.
What Does This Mean for Investors?
The two key benefits to investors are, first, the incorporation of fiat currency into the transparent tokenized investment process, meaning investors do not have to limit themselves to cryptocurrency or to being pegged to a safe haven asset like gold. Secondly, its cost-efficient structure will deliver a higher net return.
When’s the Big Day?
Blackmoon Crypto’s token will be called BMC. A crowdsale period will start on September 12, 2017, at which point Blackmoon’s holding company, will issue BMC to buyers. The funds that operate on the Blackmoon Crypto Platform will generate fees that will then be redistributed to token owners who are registered as Continuous Contributors. Contributors will be required to play an active role in deciding how the Platform is developed.
With the advent of a structured and transparent token platform, companies like Blackmoon continue to push the nascent cryptocurrency marketplace into something real and manageable, while allowing for profitability along the way.
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