Brazil’s Moeda – The cooperative network for Women Entrepreneurs on Cryptos

Its a bit counter-intuitive when we tag a country (Brazil) to a crypto start-up. While the operational capability for Moeda is currently based in Brazil, the entire world can invest into their projects using the MDA token.


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Moeda was launched in 2017 at a UN hackathon with a view to address the UN’s Sustainable Development Goals. Their vision is to facilitate capital for social entrepreneurs who have had challenges financing their business via the traditional banking system. With their platform, where they bring the community of social entrepreneurs to the world stage, investors across the world can invest in projects, while having complete transparency on the project details.

This year Moeda have onboarded 18 projects involving family farming cooperatives in Brazil. They are also developing the Moeda Seeds App that will help global investments to arrive. In Q2 this year Moeda moved its transactions to IBM’s Hyperledger fabric composer.

In the past 18 months, Moeda have made significant progress not just in Brazil, but across other neighbouring countries.

  • They opened up operations in Uruguay and became the first blockchain firm in a free trade zone.
  • Moeda’s CEO Taynah Reis, joined Brazil’s Parliamentary Special Committee on the legislation of virtual currency.
  • Moeda presented their proposition at the UN General Assembly on Sustainable Development Goals Impact Zones.
  • In Jan 2018, Moeda started funding its first set of projects for rural Brazil
  • Taynah has also spent time with UN leaders, Nobel Prize winner Muhammad Yunus, and several top world organisations including the World Economic Forum, where they showcased and validated their business model
  • More recently Moeda implemented a fiat pegged token (MDABRL) to be used in its ecosystem.

One of the projects that Moeda have taken on board their seed programme is that of Divinia. For more than 10 years, Divina from Cooperval produced and sold frozen fruit pulp, vegetables and baked goods to schools in Formosa, Goias. The group now wants to boost production and increase their income.

For the financing of the expansion, Moeda developed a Seed Project focused on the Baru, a traditional chestnut from the region. Through this project the cooperative in partnership with a local beer company will produce 1500 bottles of Baru nut beer. Moeda have helped them establish the partnership, in marketing the product and with the entire business plan to ensure investors make returns. This project, thats planned to go on for 4 months, will give investors a 10% return within that period.

Moeda are also working with a group of women that focused on 21 local projects from more than 8 states in the region developing 25 value chains pertaining to extractivism, agricultural extractivism and traditional family farming, including the Babassu palm production chain.

These are some inspiring coming out of the blockchain world, and for people asking for real world implementations of the technology, all I would say is, look at the emerging markets – its all happening there.

Arunkumar Krishnakumar is a VC investor focusing on Inclusion, a writer and a podcast host.

Get fresh daily insights from an amazing team of Fintech thought leaders around the world. Ride the Fintech wave by reading us daily in your email

Insurtech Front Page Weekly CXO Briefing – Tech giants are serious about insurance


The Theme this week is Tech giants are serious about insurance. Tech giants making moves into insurance is not new, but continuing news update can prove that they are pretty serious.

The Insurtech Front Page Weekly CXO Briefing is all you need to know for the week, jargon free for executives, entrepreneurs and investors who want a piece of this huge, fast changing market. Each week we select one theme illustrated by 3 news items, because we know that you are busy. Our job is to filter out the noise, so you can read the signal. We bring you the raw news plus our take on why it is significant.

For this week we bring you three stories illustrating the theme of Tech giants are serious in insurance.

Story 1: Softbank Plans Big Push into Insurance Investments

Extract, read more on Insurance Journal:

“Softbank’s Vision Fund plans to pump more money into insurance, a sector it sees as both ripe for disruption and a potential booster for its bigger bets in cars, health and financial services, a Vision Fund executive told Reuters.”

Softbank is not a typical tech giant, they have contributed a lot in telecommunications, but they are better known for their investments in Alibaba, Uber, Boston Dynamics etc. They also invested in Zhong An. With Softbank’s huge fund ($100 billion) and successful investments to date, their moves into Insurance will be worth watching.

Story 2: Google Invests in Insurance Agency Software Firm Applied Systems

Extract, read more on Insurance Journal:

“Giant Google’s investment arm has purchased a minority stake in Applied Systems, a provider of insurance technology and cloud-based software for independent agencies.

The investment in Applied Systems is being made through CapitalG, the growth equity investment fund of Google’s parent Alphabet, which has also financed companies including Lyft, Airbnb, SurveyMonkey and Zscaler.”

Google’s comparison site didn’t pan out. Fortunately for the industry they are still watching and investing.

Story 3: Amazon makes another insurance move and partners with Vitality

Extract, read more on Life Insurance International:

“Vitality has announced a partnership with Amazon with gives its Active Rewards programme a boost.

As a result, members will receive a month’s access to Amazon Prime for every 160 Vitality activity points they earn. This can lead to savings of up to £79 ($104) a year.”

Amazon made several moves before, such as investing in Acko and the joint action with Berkshire Hathaway and JP Morgan into Healthcare. Partnership with Vitality seems relatively a small one, and more like a pilot cooperation. But it might turn out to be critical since it involves actual insurance work.

Since the day the word “InsurTech” was invented, tech giants have been making moves to enter insurance. They have suffered a few setbacks (e.g. Google Compare), but they are the leaders in the “Tech” part. When they have a deeper understanding in insurance, their technologies might start playing major roles.

Zarc Gin is an analyst for Warp Speed Fintech, a Fintech, especially InsurTech-focused Venture Capital based in China.

Get fresh daily insights from an amazing team of Fintech thought leaders around the world. Ride the Fintech wave by reading us daily in your email.



Crowd Sourced DD the future to unlisted asset investment explosion

Lately I’ve been thinking a lot about the flow of capital.

You do that when you run a super fund. Especially when you are thinking about the opportunities that exist when you have the ability to be significantly more agile with your investment strategy.

And when you link the use of capital to where it is needed most, to grow the economy, you naturally gravitate towards the small business sector, and the unlisted asset space.

It’s not as easy as flicking a switch though – investing pension fund money is a huge responsibility, and how it is handled is a serious business. Small business and the unlisted space is notoriously risky, and pricing and handling that risk is the dark art of this game.

But it is relatively patient capital, and there are some interesting dynamics that can be explored, based on this principle.

But before you even get to that point, you need to find good businesses, and that is another huge problem that still needs to be solved.

One fintech in that space trying to solve part of that particular problem for wealth managers, like pension funds, is Delio. Based out of Cardiff, Wales, the platform offers ‘infrastructure as a service’ to help manage the entire unlisted asset investment process, from origination to exit.

Wealth managers, private banks, investment banks, family offices and many more can use the platform’s white label digital insfrastructure to upload deals and manage the entire process, end to end. The company is already partnered with UK Business Angels Association, connecting over 15,000 angel investors with high quality deal flow.

DelioConnect also offers platform to platform integration, so clients can originate, syndicate or distribute within the trusted network.

These sorts of platforms are the future of getting capital to small business. They are potentially far more powerful than neobanks in the SME space. And they solve the crowd-sourced due diligence problem. Which until technology is sophisticated enough to manage on its own – for which we are still a way off – is critical to increasing the flow of money into productive, growth investments.

The principles behind how platforms like Delio work should be attractive to smart pension funds and new age wealth managers, looking for efficiencies and an edge in the unlisted space.

Daily Fintech Advisers provides strategic consulting to organizations with business and investment interests in Fintech. Jessica Ellerm is a thought leader specializing in Small Business and the Gig Economy and is the CEO and Co-Founder of Zuper, a new superannuation startup in Australia.

The Internet of Finance from the East & the 50mil unbanked in Brazil


Much has been written about China’s growing commercial relationships with Latin America. Some have suggested that China is replacing the United States as the region’s most important partner. The focus has been mostly on Chinese infrastructure investments in Latam.

This October one of the Internet of Finance leaders, Tencent invested $180 million in the Brazilian neobank ‘NuBank[1] the largest Latin American digital bank and credit card operator. Nubank, is a 5 yr old Latam FinTech pioneer, who has raised a total of $330 million since it was founded in 2013 by Sequoia Capital ex-partner David Vélez. Clearly, one of the best-funded start-ups in Brazil. To date, it has issued 5 million no-fee credit cards and has opened 2.5 million digital payment accounts.

Nubank’s impressive expansion has spurred growth in the Brazilian Fintech market, with 188 ventures being launched in the past 18 months. This includes standalone Neobanks such as Banco Original, SDBank, LabsBank, beBank. Incumbents have also joined the competition with Digio being one example, launched by Banco do Brasil and Bradesco in 2016 to compete directly with Nubank’s fee-free business model. These strong recent developments have earned Brazil the title of leading FinTech ecosystem in Latin America. [2]

Nubank has streamlined the onboarding process and is offering fast, transparent consumer banking mobile services to make transfers, pay bills and earn interest on deposits. Just recently Nubank got clearance from Brazilian Central Bank to offer loans to its customers which will allow the already well-funded start-up to expand further.

Nubank is the high-growth Latam Fintech that has managed to attract major international attention and investment. The recent Tencent investment is increasing Nubank’s capital by $90 million and repurchasing the equivalent amount from Nubank’s existing shareholders, pushing the neobank’s valuation up to $4 Billion. Tencent President Martin Lau explained that the investment will help Nubank “build a full-service personal finance platform.”[3] The Chinese conglomerate is no stranger to these transactions, with major shareholdings in other FinTechs and Neobanks such as the online bank WeBank, fintech business Voyager of Philippine telco PLDT, online insurer ZhongAn Online P&C Insurance Co Lt, supply chain financing provider Linklogis.

According to Nubank CEO David Velez, the investment is for Nubank a great strategic standpoint to gain insight on- and learn from the Chinese financial market. For Tencent, this is a means of expansion of their existing portfolio of challenger banks and technology-based financial services ventures as well as a robust point of entry to the booming Brazilian FinTech Market.

The Internet of Finance from the East in synergy with the 50mil unbanked in Brazil.

This not Chimerica, the term coined by Niall Ferguson to describe the symbiotic relationship between China and America more than 10 yrs ago.


This could be “Chilatam” led by Brazil who has put forward new Fintech regulations to encourage competition in their financial sector that is dominated by the Big 5 banks, much like in the UK or Australia.

#AndtheIronyIs that Chimerica, the award-winning play of Lucy Kirkwood, became 4 part TV series –  “Chimerica”. The play examines contemporary global politics and the relationship between East and West.

#AndtheIronyIs is my Twitter hashtag for cynical Finance tweets.

[1] Reuters, 2018, ‘China’s Tencent invests $180 million in Brazil fintech Nubank’

[2] Finnovista, 2018, ‘Brazil recovers the leading position as largest Fintech ecosystem in Latin America with over 370 Fintech startups

[3] Reuters, 2018, ‘China’s Tencent invests $180 million in Brazil fintech Nubank’ 

Efi Pylarinou is the founder of Efi Pylarinou Advisory and a Fintech/Blockchain influencer.

Get fresh daily insights from an amazing team of Fintech thought leaders around the world. Ride the Fintech wave by reading us daily in your email.


Blockchain Weekly Front Page: Cryptocurrency markets shrug off loss of confidence in Tether and equities correction


The Blockchain Weekly Front Page is a CXO level briefing. Our mission is to serve the mainstream business community by selecting one major theme in the Blockchain Economy each week and three news stories to illustrate that theme. This is all you need to know, each week, jargon free for CXO level business leaders and investors who will use this technology to change the world, in your email inbox each Monday at 7am CET. 

For more on the format please click here.

Last week our theme was “Big Old Money Bets on Bitcoin & Blockchain”.

Lately, Tether has been anything but stable. Earlier this week the USDT lost its peg to the dollar, after rumors surfaced about Bitfinex’s insolvency, driving is price down by eight cents, to $0.92.

In a post on Medium, Bitfinex has dismissed the rumors stating that “Stories and allegations currently circulating mentioning an entity called Noble Bank have no impact on our operations, survivability, or solvency.” Bitfinex was a customer of Noble Bank, based in Puerto Rico, and the banking institution has found itself practically on the brink of bankruptcy.

Tether (USDT) is eighth largest cryptocurrency, with a market capitalization of $2 billion. A crisis with Tether would cause serious ripple effects on the entire market. More than 21% of all crypto transactions are made up of USDT pairings. A loss of value would wipe out a billions of assets.

For months now, Tether has been haunted over transparency issues, ranging from its murky relationship to Bitfinex, to whether it USDT is fully backed by dollars and to what bank is holding these assets.

Tether is not the only stablecoin and the idea of a price-stable cryptocurrency has been around for a long time. There are basic types: fiat-collateralized, crypto-collateralized, non-collateralized and we have several examples in the market (TUSD, USDC, PAX).

Some of the newer ones, like the the Gemini dollar, are regulated by the New York Department of Financial Services. Now, if supply is a metric of success, Paxos, a new stablecoin, is taking an early lead, doubling its supply in circulation.


The fact that cryptocurrencies can be very volatile, poses risks. Today, no retailer in their right mind would price their products based on Bitcoin or any other cryptocurrency. No employee would want to be paid in crypto.

There are many critics that doubt whether stablecoins will be able to hold their pegs, over time. Some argue that creating cryptocurrency backed by a fiat currency inherits the same problems as fiat, because its supported by the same old traditional banking system.

Stablecoins offer low volatility, and have the potential to unlock the future of cryptocurrencies. While many of today’s solutions look viable, its still a crapshoot, and very early to make any kind of predictions, both from a technology and regulatory perspective.

Over the last ten months, as prices have dropped, mergers and acquisitions have reached a record high in 2018. According to JMP Securities and data from PitchBook, crypto M&A activity has doubled this year and is expected to reach a total of 145 deals by the end of 2018. Since 2010, the industry only had 88 completed M&A transactions, according to PitchBook. Crypto’s busiest years were 2015 and 2017, with 23 deals, each year.

For any growing industry, mergers and acquisitions is a big part of the game. A lot of companies use M&A as means to grow faster. Mergers and acquisitions happen for all kinds of reasons, but most of them have economic motives. The crypto industry is witnessing a “land grab” for new and innovative technologies, access to markets, customers, intellectual property, and talented employees.

In March, Coinbase hired Emilie Choi, and right after it acquired Earn for around $100 million. Also, with exchanges being some of the hottest real estate in crypto, earlier this year, Circle, announced the acquisition of Poloniex.

In many cases, many of these startups and their coins will just fall short and disappear into the night, after spending huge amounts of money from investors. Everyone is trying to position themselves for a piece of the pie, but some times its like pulling a rabbit out of a hat. With are over 2,100 cryptocurrencies on, no one really knows what will succeed or what will fail.

Consolidation is still relatively low, since most of these platforms are still building their core products. We can expect to see more of it, as many of these platforms try to build ecosystems that combine utility and currency tokens.

There is even a blockchain startup for M&A, Lexit, which is trying to disrupt the way companies and their intellectual property are being bought, sold, and licensed. Who knows, we might even see cryptocurrencies being used to pay for shares or assets in an M&A transaction.

For now there is a a lot of repetition, just like in the early days of the Internet. But there will be some cases, where the merger could have a significant impact, both on the crypto world and beyond.

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Ilias Louis Hatzis is the Founder & CEO at Mercato Blockchain Corporation AG. He writes the Blockchain Weekly Front Page each Monday.

Please Welcome Paul Conley as our Content Adviser

I am happy to announce that Paul Conley is joining Daily Fintech as Content Adviser on our Non Executive Advisory Committee.

Over the last four years Daily Fintech has built a reputation for high quality content, funded through advisory services. We now seek to grow the business by a) growing the content b) launching new scalable revenue lines of business.

Paul will help guide our efforts during these exciting times.

I have known Paul for many years and have a deep respect for his approach to B2B content. Paul has trained and coached legions of journalists and is also a new media savvy entrepreneur who understands the need to reinvent B2B Media by innovating on the revenue side of the business. You can see his background on LinkedIn. His finance experience at CFO Magazine and Bloomberg is particularly relevant to Daily Fintech as they are two brands that have maintained high quality content standards despite the rush to cheap online clickbait in many publications.

I will leave the last word to an introduction to Paul in an interview on a site that tracks the transformation of B2B Media:

“In the trade magazine business, not generally known for early adoption of new-media developments, Paul Conley is something of an anomaly. He is, as he puts it, “hypersensitive to how new technology opens up opportunities in old worlds.” He was among the first in the trade press to recognize the significance of social media.”

Debt crisis and a weak currency – would India follow Venezuela in launching a digital currency?

In Q2 this year, the Reserve Bank of India banned cryptocurrencies. The ban announcement was met with mixed reaction, but largely disappointment from the crypto community. While the RBI and the Indian government are taking a lot of efforts to execute Blockchain based projects across the nation, that ban was disappointing.
 In view of the associated risks, it has been decided that, with immediate effect, entities regulated by RBI shall not deal with or provide services to any individual or business entities dealing with or settling VCs. Regulated entities which already provide such services shall exit the relationship within a specified time. 
Earlier this week, @efipylarinou and I launched the second episode of our podcast on Blockchain and Financial inclusion on Rhetoriq. Lisa Nestor from Stellar Development Foundation discussed the challenges that Blockchain industry had in the Indian Market.
Stellar was known to be working with ICICI bank and other regional financial services players, with a view to bringing financial services to the rural population. The ban has now slowed them down, however, Lisa was confident that the research work they are doing with some of the Indian institutions should bear fruit in the long run.
Over the last 12 months or so, the Reserve Bank of India (RBI) has taken a Jekyll and Hyde approach to Blockchain and Cryptos. The stance that the Indian policy makers have taken regarding this space is confusing and conflicting. In the sense, RBI are a big no-no to cryptos where as the Indian government and other public bodies have embraced the technology in a big way.
Many technology giants (IBM, Microsoft), local government bodies and the crypto community within India have come together to create the Internet Blockchain Committee whose remit is to build a Blockchain ecosystem in India by working with the government, industry players and startups.
The RBI themselves are working on a digital currency, which they confirmed a few weeks ago. The digital currency is believed to be backed by the Indian Rupee, and the plan is to save about 7 Billion Indian Rupees annually.
The creation of a Rupee backed digital currency is not really going to make it stronger than the Rupee. However, with the creation and management of paper currency in India costing 7 Billion Rupees, combined with the advent of the new payments infrastructure well supported by the roll out of Aadhaar that brings economic identity, we now have enough motivation and a conducive environment for an RBI backed digital currency.
While all this work is being done, the ban on crypto exchanges still stand. This is being fought out in the supreme court of India, where the RBIs decision to ban cryptos is being challenged. However, I believe, just the binary stance against cryptos would push India a few steps behind jurisdictions who have taken a more collaborative approach to Cryptos.
One of the top crypto exchanges in India Zebpay have recently setup shop in Malta, and will be providing their services across 20 countries that doesn’t include India. With news from the subcontinent coming at a brisk pace, and with the INR hitting an all time low against USD, will RBI turn to digital currency?
In a recent survey conducted for bitcoin news, 80% of respondents preferred bitcoin as a safer haven than the Indian Rupee. The INR has been consistently losing about 10% per year over the last few years against the USD, and of course we know how volatile cryptos has been over the last 12 months or so. So while the results of the survey looks pretty skewed, it gives a view of the mindset of a generation that wants to now move on to digital currencies.
However, I wouldn’t be surprised if, after Venezuela, India becomes one of the first to go down the route of central bank backed digital currency. And that would still be just one step forward. Real progress would be when RBI lifts the ban against cryptos, and allows for innovation to find its feet with a collaborative approach.
Its time for the largest democracy in the world to truly embrace democracy – and move away from such absolutism.

Arunkumar Krishnakumar is a VC investor focusing on Inclusion, a writer and a podcast host.

Get fresh daily insights from an amazing team of Fintech thought leaders around the world. Ride the Fintech wave by reading us daily in your email


Insurtech Front Page Weekly CXO Briefing: InsurTech doesn’t stop at borders


The Theme this week is InsurTech doesn’t stop at borders. This indicates that InsurTech is truly a global trend.

The Insurtech Front Page Weekly CXO Briefing is all you need to know for the week, jargon free for executives, entrepreneurs and investors who want a piece of this huge, fast changing market. Each week we select one theme illustrated by 3 news items, because we know that you are busy. Our job is to filter out the noise, so you can read the signal. We bring you the raw news plus our take on why it is significant.

For this week we bring you three stories illustrating the theme of InsurTech doesn’t stop at borders

Story 1: Berlin Insurtech Startup Simplesurance Sets Sights on U.S. for Future Expansion

Extract, read more on Insurance Journal:

“Based on the edge of Berlin’s trendy Mitte district in bright, open offices, Simplesurance is yet another insurtech startup seeking to transform insurance. It is also eyeing the U.S. for future expansion.

Simplesurance began in 2012, employs more than 150 people, and its cross-selling software operates across Europe. E-commerce partners can sell insurance products by adding the option to purchase insurance for a device with just one click on the platform’s shopping basket. As well, Simplesurance now offers an insurance broker app in Germany.”

US is definitely a primary market for any companies who want to do a global business. And it’s time for Simplesurance.

Story 2: HCS Capital Deploys $3MM into Growing InsurTech Opportunity, Jooycar

Extract, read more on The VentureBeat:

“HCS Capital Partners (“HCS”) a Miami, FL based Private Equity and operating firm, announced today it has completed a $3mm investment in Jooycar, a fast growing Chilean company disrupting the auto insurance and telematics space in Latin America. This InsurTech investment marks the most recent for HCS, as they continue to deploy capital from their Tech Fund 1 into InsurTech and FinTech opportunities in the U.S. and South America.”

Jooycar is aiming to expand in US. The help from HCS should come in handy.

Story 3: Prima Italian Insurtech MGA Raises €100 Million from Goldman Sachs and Blackstone

Extract, read more on InsurTechnews:

“Goldman Sachs Private Capital Investing along with several funds managed by The Blackstone Group’s Tactical Opportunities have invested €100 mln in Prima Assicurazioni, a Milan-based InsurTech start-up that sells auto insurance.”

Prima’s action is only one of them in Italy. After Germany, UK and France, Italy can be another influential force in the InsurTech community.

Countries like United States, China, Germany have been leading the digitalization age in the 21st century. It’s good to see more voices in InsurTech. And the mature market in US can be a good place to test new InsurTech models.

Image Source

Zarc Gin is an analyst for Warp Speed Fintech, a Fintech, especially InsurTech-focused Venture Capital based in China.

Get fresh daily insights from an amazing team of Fintech thought leaders around the world. Ride the Fintech wave by reading us daily in your email.

Lenders Avant and On Deck spin out new platform businesses

Fintech is often viewed through the challenger, disruptor lens. But more often than not, fintech is an incubation vehicle for banking proof-of-concepts. Not many banks deeply, organisationally get this. Even their Corporate Venture Capital arms struggle to deliver. If they did, the pace of banking innovation would be tremendous. It’s not.

But fintech lenders like On Deck and Avant do, and are now in the maturity phase of their fintech lifecycle that this ‘incubation’ phase is starting to produce white label opportunities for their proprietary technology.

Small business lender On Deck has launched ODX, a separate company that helps banks build digital SME lending products, while personal loan startup Avant is taking a similar tack, launching a new infrastructure platform called Amount that will help banks build digital consumer lending products.

Many startups struggle with the white label or disrupt model early on in their lifecycle. White-labelling is often appealing when cash flow is tight, and the hurdle to achieve market share seems overwhelming.

But as On Deck and Avant have shown, if you time things correctly, it really is possible to do both – and do them well. On Deck for example has originated over $10 billion in loans since 2006 and Avant has issued over 750,000 personal loan, auto loan and credit card products through its technology platform.

The financial institution of the past obsessed about owning the customer at every step of the financial journey. The fintech first financial institution of the future possibly cares less about that, and more about owning the technology layer.

What is interesting is that beyond one to one partnerships with banks, of which both Avant and On Deck have established in the past, both fintechs see a business case in creating a platform strategy and business line specifically focused on this area. This suggests a fundamental shift in attitudes in banks to work with alternative technology platform providers who are also, in many senses competitors.

Daily Fintech Advisers provides strategic consulting to organizations with business and investment interests in Fintech. Jessica Ellerm is a thought leader specializing in Small Business and the Gig Economy and is the CEO and Co-Founder of Zuper, a new superannuation startup in Australia.

Crowdfunding, investing, & listing – DESICO for STOs

Interesting times! I am not referring to politics but financial markets both the traditional stakeholders and the disruptors. From Roubini lashing out on the crypto ecosystem, to Morgan Stanley gearing up to trade crypto derivatives, and Circle buying crowdfunding and broker-dealer Seedinvest.

The narrative around tokens has shifted Q1 2018. Utility tokens are no more darlings, STOs seem “the way to go” but pieces are missing still to satisfy the much-anticipated institutional appetite. #AndTheIronyIs that the ICO frenzy aimed to democratize early stage startup investing. It was supposed to allow retail to fund and participate in the startup tsunami that is building the winners of the 4th industrial revolution. Transparency and no gate-keepers were also promised.

#AndTheIronyIs it became about whales (the new gate-keepers) and now it is about crypto funds (the other new gatekeepers) and the conventional institutional money (e.g. the Ivy League US endowments[1]).

On the regulatory front, Europe seems to be leading with frameworks that try to not choke the blockchain early-stage innovation and at the same time provide some guidelines. The recent support from EU parliament of the Blockchain Resolution[2], is significant for several reasons. Switzerland, Liechtenstein, Malta, France, etc have also made progress on the regulatory front. Lithuania is one of the small Baltic countries which has attracted several Fintechs (even the Revolut unicorn) because it has been offered licensing and therefore EU passporting to these Fintech innovators.

In a September Forbes article[3] the Central Bank of Lithuania is singled out because of a new law allowing to invest in crypto assets through Security Token Offerings (STOs) in Europe. DESICO is referenced as it is taking advantage of this retail STO law and building a token platform for issuing, listing and trading security tokens in a fully compliant way.

DESICO has designed a different business model

desico image

The founders of the DESICO platform are Fintechers, founders of Finbee a P2P online lending platform. They saw a business opportunity to not only legally launch an ICO platform for early-stage startups in which both institutional but retail also can invest; they are also designing it to onboard revenue generating SMEs (not necessarily blockchain businesses) that need to raise capital. As Laimonas Noreika, the CEO of DESICO, said to TechStartups “Desico doesn’t want to focus on tokenizing pension funds, investment funds, or real estate projects.”

DESICO will filter companies for scams and will let the crowd vet projects on the DESICO platform. The costs of the entire ICO process will be cut to one third the current costs, and various service providers will be onboarding on the DESICO platform. Once the token sale is successful, the tokens will be listed on the DESICO exchange and investors will be able to trade (no waiting times, no exorbitant costs). Investors (both retail and institutional) will be legally able to buy the tokens on the DESICO platform. Any kind of security token issued on the DESICO platform will be fully compliant. With the support and backing of the Lithuanian Ministry of Finance, the Ministry of the Economy and the Central Bank of Lithuania, and under the crowdfunding law, any funding under 5million euros following the crowdfunding requirements is a legal security token.

The DESICO platform will be an end-to-end platform (for early startups and SMEs) to crowdfund, to list and trade on an exchange, and to invest. The founders are in the process of acquiring the three required licenses, a crowdfunding license, an e-money licenses, and brokerage licenses.

The DESI token is a security token and the sale starts on November 7. DESI token holders will receive a revenue share of 12.5% of DESICO’s gross income over the next 30 years. Payouts will be quarterly, with no cap on the revenues. It is a 30-year Revenue Participation Note that is callable after 5 years at any time.

DESICO revenues will come from primary and secondary market fees of the tokens issued and traded on the DESICO ecosystem. The primary fees will be paid by the security token issuers in a mix of fiat and project security (STO) tokens. Secondary market fees will come from the exchange activities.

DESICO is as close as it gets to the next generation of a crowdfunding platform with in-house liquidity. It’s design is for the crowd too, not only for institutional. It’s business model borrows elements from Angel list, as its revenues include security tokens issued on the platform. The founders know how to work with regulators and license providers and know how to build an investor base. For details, read thoroughly the white paper.

Disclaimer: I am an advisor to the DESICO platform.

[1] Report: Harvard, Stanford, MIT Endowments All Invest in Crypto Funds, Cointelegraph

[2] In the EU Blockchain Resolution we Trust, DailyFintech

[3] Institutional Investors Bet On Crypto Market With Tokenized Securities, Forbes

Efi Pylarinou is a Fintech thought-leader, consultant and investor. 

Get fresh daily insights from an amazing team of Fintech thought leaders around the world. Ride the Fintech wave by reading us daily in your email.