The following is an objective review of CrypStock ICO. The review is based on the criteria that we think are important for an ICO project to succeed. We measure a successful ICO by estimating short and long-term ROI. The following is not financial advice.
CrypStock is launching an exchange that potentially will offer its users the best price on the market for the coins traded on its platform. CrypStock will offer its users a merged order book of 30+ exchanges. It is not an easy task to offer traders fast execution order opportunities from tens of exchanges. To do so, exchange funds need to be distributed on all connected exchanges before the trade executes, and a sophisticated trading system needs to be developed.
A pilot version of the exchange is expected to launch in November 2018. CrypStock is currently in its presale stage. It is aiming to raise a total of 50M USD. A high cap is needed to fund the exchange structure described above.
ICS token holders will receive 30% of the exchange income via ETH, in a monthly distribution.
The team is highly motivated and has been working hard on the project for the past year.
Let’s start with our evaluation!
CrypStock Exchange Features
Merged Order Book – 30+ Exchanges – potentially the best price on the market
The CrypStock platform is fundamentally different from other systems that offer users the ability to conduct transactions on different exchanges from one account. The concept is based on the fact that traders perform transactions in a system, which is a smart intermediary between its own order books and other exchanges. At the same time, a combination of order books and usage of the systems own funds on the different exchanges gives users the opportunity to immediately execute their trades on all connected exchanges.
The following example shows a scheme of the combination of orders and different exchanges and a comparison of the average price:
The following is a made-up example in order to show the concept of the merged order book and its advantages:
A buyer wants to buy 3 ETH. We will show the merged order book use-case with only 3 exchanges.
ETH/USDT average prices on 3 different exchanges:
CrypStock Merged Orderbook:
Buying price of 3 ETH on Exchange A or B or C= 602 USDT
Buying price of 3 ETH on CrypStock= 600 USDT
The example above shows that if a user wishes to buy 3 ETH on each of the exchanges A/B/C, he is expected to pay an average price of 602 USDT for each ETH.
Using a merged order book of the 3 exchanges the user will be able to buy the 3 ETH at an average price of 600 USDT.
CrypStock Market Making – Higher exchange profits
We will use the previous example to explain the market-making mechanism of the CrypStock system that allows potentially higher profits for the exchange and the token holders (ICS token holders earn 30% of the exchange income, explained later).
The average price of 3 ETH on crypto exchanges A, B or C will be 602 USDT. The combined order book of CrypStock allows you to reduce the average price to 600 USDT. However, to receive more profits, the trader will be able to buy the 3 ETH for 601 USDT. One USDT is earned by the system (and ICS token holders).
To conclude the market making function, the merged order book on the CrypStock exchange will offer a slightly higher price than the lowest price available on all of the connected exchanges. However, the price will still be the lowest price on the market.
Block trading is a service that will be offered to VIP traders (high volume traders). In order to get the lowest price possible on a high-volume trade, a trader must usually split his buying order into smaller chunks and buy its position over time and not in one purchase.
CrypStock offers an agent that will execute the trade over time, and in small portions, for large-volume traders. By combining the merged order book and the block trading function, a trader will potentially get the lowest price on the market for a large position.
Below is a comparison of the results of purchasing ETH for BTC equivalent to $1,000,000. The calculation is based on real data from 12 exchanges (09/03/2018 15:00 – 16:40). The diagram was taken from the CrypStock Whitepaper.
Merged A – The potential profit of buying $1 Million through a merged order book vs Kraken/Bittrex exchange.
Merged B – The potential profit of buying $1 Million through a merged order book and the Block trading function vs Kraken/Bittrex exchange.
The example shows that option 1 (Merged A) saves 1.2-1.6% for the user compared to direct purchase, and option 2 (Merged B) saves 1.7-2.1%. According to CrypStock’s estimation transactions of $10,000,000 can benefit by more than 5% if they use option 2 (Merged B).
T4T Token – CrypStock USD backed token – Lower barrier to entry
T4Ts are tokens that are issued by the CrypStock exchange and are backed 1:1 by USD. Users of the exchange will be able to purchase T4Ts using different types of payment methods. This purchase process will be monitored by trusted third party entities.
The T4T will be traded vs ETH, BTC and other pairs.
T4Ts will allow new traders to easily enter the crypto market and to join the CrypStock exchange.
The team has been working on the CrypStock exchange for the past year.
August 2018- Prototype A
Launch of the main exchange platform with 5 currency pairs available via a merged order book, connected to 10 exchanges, partly in real-time. Available for selected customers to test the platform.
October 2018- Prototype B
Launch of the main exchange platform with 10 currency pairs available via a merged order book, connected to 20 exchanges, all pairs are traded in real-time. Available for selected customers to test the platform.
November 2018- Pilot Version
Launch of the main exchange platform with 20 currency pairs available via a merged order book, connected to 30 exchanges, all pairs are traded in real-time. Available to the public. ICS tokens are tradeable.
January 2019- Full Launch
The exchange works in fully functional mode. New tokens are accepted. The merged order book of at least 20 currency pairs works with 50+ exchanges.
ICS Token- ERC 20
- ICS Token holders will receive 30% of exchange income via all channels. Profit-sharing will be distributed monthly, in ETH, to the user’s account.
- Users that pay fees with ICS will receive a 50% discount
HICS Token- ERC 20- A bonus for purchases above $5,000
Total supply- 50M Tokens.
When a user contributes $5,000 or above to the ICO, he will receive the following:
- 80% of the contribution in ICS tokens
- 20% of the contribution in HICS tokens
HICS token holders receive 20% more profit than ICS token holders.
HICS tokens are only used to incentivize large contributions to the ICO.
Total Hard Cap: 50M USD for ~71% of the tokens
- ~60% of the funds collected will be distributed to the exchange accounts on the 30+ future exchanges to allow fast execution trades of the merged order book.
Pre-sale (11/6-11/7): Bonuses: 40% (11-15/6), 25% (16-23/6), 20% (24/6-1/7), 15% (2-11/7). No lockup.
Presale Soft Cap: $1M, reached.
Public-sale (15/8-10/9): Bonuses: 20% (15-25/8), 15% (26/8-2/9), 10% (3-12/9), 5% (12-20/9). No lockup.
Token Allocation: 55% All sale rounds, 16% Sale bonuses, 17% Chipmine fork (Seed investors), 8% Team, 1% Advisory, 3% Bounty.
Lockups: Tokens of the team and Chipmine fork (Seed investors) are fully locked for 6 months.
Limited Token Supply: ICS and HICS are minted through a smart contract upon contribution during all phases of the sale. The number of tokens created will be determined at the end of all sale rounds.
Alexander Keselman- Co-Founder, Technical Manager
Founded Virtech in 2001, a group of companies that offered development of financial and trading systems. Among its customers are Bank Leumi, Bank Hapoalim, the Central Bank of Israel, Tel-Aviv Stock Exchange, Ukrainian Exchange, etc.
Ofir Felix Roitman– Co-Founder, Project Manager
An accomplished business developer & analyst with over 10 years in the investment and financial sectors. Mr. Roitman has formed part of, and led, teams of highly successful ventures yielding multi-million revenues during his involvement.
David Suleymanov– Marketing director
CEO of Xport MEDIA, 18 years of experience in a full stake marketing and PR Agency. Expertise in all areas of marketing for the launch of new global projects and products.
Oleg Tkachenko – Exchange and market-making
Served as the President of the Ukrainian Exchange for the past 10 years. One of the creators of the Ukrainian derivatives market. One of the initiators of the cryptocurrency (and their derivatives) legalization in Ukraine.
Zeev Volkovich– R&D
Ph.D., professor, dean of the Computer Sciences faculty at Ort Braude College of Israel, specialization – Data mining, statistics, Pattern Recognition.
Matvey Levant– Legal Consult
Managing Partner, Levant & partners law firm, ICO Legal Advisor, Admitted to practice in New York, USA
The 24 hours crypto exchange volume in recent times is ~11B USD equivalent. Crypto exchanges that attract large volumes are making huge profits from token listings and exchange fees paid by users. Since the recent crypto boom in 2017, many exchange projects are launching. Though a merged order book of tens of exchanges makes sense, there is no project that offers this in a way that is efficient enough. CrypStock exchange will potentially offer fast execution trades from their platform to the best prices on the market, this advantage should give CrypStock exchange a great advantage over its competitors.
Most ICOs release utility tokens as compensation for contributions. Usually, the correlation between the success of the project and the token price is limited.
ICS tokens are used to pay fees on the exchange (50% discount compared to other payment methods).
The big advantage of holding ICS tokens is profit sharing. 30% of the exchange income is paid monthly via ETH to the token holders. We like this approach, this should create a great incentive to hold ICS.
Project success has a highly significant reliance on the amount of funding.
A large amount of funding is needed for the project to successfully offer its main advantage – the lowest price on the market. In order to offer fast execution trades on all future crypto pairs, CrypStock own money has to be distributed on all offered exchanges. The project will use a highly sophisticated algorithm to determine the right amount of funding needed on each of the exchanges.
CryptoPotato ICO Evaluation – the result
Team & Advisory board: Core team has a vast experience in financial services and exchange platforms. The ex-president of the Ukraine Stock Exchange has joined as an advisor. No notable figures/entities from the global crypto ecosystem Score 7.5
Stage of the project: Beta will be available for private testing by August, Full launch by the end of 2018. Score 8.5
Project potential: Innovative approach allows immediate execution time for the lowest prices on the market. Score 9
Community and Media: ~5,400+ Telegram members. Score 7
Token use: ICS offers its holders 30% of the total exchange income and a 50% discount on trading fees. Score 9
ICO: Hard Cap – $50M for ~71% of tokens, 17% for Chipmine (Early seed investors), 8% team, 1% advisors. Team and Chipmine allocation fully locked for 6 months. Score 7
Whitepaper: Whitepaper describes the project at a very high level without any technical explanation. Score 6.5
Backend and Technology: Highly scalable exchange, a sophisticated algorithm to distribute funds on all exchanges. The backend architecture is not public. Score 8
CryptoPotato CrypStock ICO score: 7.98/10
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