ICO Analysis: UTRUST

With the advent of cryptocurrency, it’s clear that the future of digital payments is upon us. Until now, advances in blockchain technology have occurred outside the purview of digital payments between buyers and sellers. That’s until UTRUST came along.

UTRUST is an ambitious payment system that enables buyers to use their favorite cryptocurrency to pay for merchants for goods and services. Merchants or sellers enjoy the safety and convenience of receiving funds in fiat currency, while buyers get the added protection of UTRUST as mediator. The platform combines the payment protection features of existing fiat systems with the innovative features of blockchain.

UTRUST has labeled itself the “crypto-contender to PayPal,” a sign that the company is aiming to take the reigns as global payments leader.

The UTRUST Platform aims to provide the consumer protection buyers take for granted in traditional online purchases, acting as amediator, resolver of conflicts, enabling the possibility of refunds to mitigate fraud, while shielding the merchant from crypto-market volatility. We want to build upon the best features of cryptocurrencies, enabling fast transactions, lower fees and low cross-border transaction friction, enabling merchants to sell to a growing worldwide audience of crypto-holders. In sum, we aim to build the payment API for marketplace integration that will become the crypto-contender to PayPal. – UTRUST Whitepaper (2017)

In demonstrating its value proposition, UTRUST has issued the following comparison chart. The chart provides a compelling snapshot of what the company hopes to achieve.

Source: UTRUST Whitepaper.

There’s plenty of hype surrounding UTRUST. The startup raised more than $1.5 million in 90 minutes during its August pre-sale, demonstrating huge demand for a global cryptocurrency payment platform. Following the huge support received during the pre-sale, UTRUST has boosted its infrastructure and support staff in preparation for its public initial coin offering (ICO) Nov. 2. Thousands of investors have already registered to buy the ICO, so this one is expected to move very quickly.

The initial $1.5 million investment has allowed the startup to secure a schedule for technical development, as well as further its marketing iniatives.

UTRUST Token

As the company states, the purpose of the crowdsale is to raise enough capital to “establish a de-facto payment platform in the cryptocurrency world and become lead Fintech startup in digital payments.”

In support of that vision, UTRUST is offering a ERC20-compatable token over the Ethereum blockchain. Ethereum was the natural choice for a project of this nature, given the platform’s industry standard for issuing custom cryptocurrencies. The Ethereum ecosystem also has several other advantages, including development tools, wallets and exchanges. The ability to integrate smart contracts is also a strong value proposition offered by the Ethereum network.

The UTRUST token serves as an investment stake in the company as well as a transactional token for buying goods and services on the platform. As such, the token serves a number of functions inside the platform, including:

  • facilitating buyer/seller transactions;
  • allowing users to spend tokens on merchants that support the platform; and
  • the ability to sell the token in the exchange, privately or hold it for future use.

Each time a buyer pays with cryptocurrency through the platform, a percentage of the transactional fee is used to buyback a UTRUST token and remove it from the market. In other words, the removed tokens will be completely destroyed, thus reducing the total number of tokens in supply and boosting future demand, adoption and value for contributors.

As the following image illustrates, buyers will be able to purchase goods and services with any major cryptocurrency or UTRUST tokens. The latter has the added benefit of no conversion fee. Sellers receive the funds in the fiat currency of their choosing, allowing them to withdraw directly to their bank account, retain inside the wallet or convert to another cryptocurrency.

Source: UTRUST Whitepaper.

The company plans to deliver a transactional platform for the first quarter of 2018. This first iteration of the platform will be supported by a wallet app connecting buyers and sellers. The pilot launch will feature select merchants, with a more expanded rollout in the third quarter of 2018.

The Team

The UTRUST team includes professionals with a background in management, payments and cryptocurrency. The company is headed by Nuno Correia, who serves as Chief Executive Officer. Nuno is an early cryptocurrency adopter, and has been involved in the market since early 2011. This includes founding several B2C ventures.

The management team also includes a CIO, CTO, CPO, Head of Engineering, VP of Marketing, Head of Design, Head of Operations and others. Six engineers are also retained, in addition to nine advisors. The team is one of the strongest the author has seen for an early stage ICO.

Verdict

Make no mistake – UTRUST is a powerful platform with a strong value proposition. It is aiming to resolve the biggest issue holding back mainstream cryptocurrency adoption – namely, the ability to use digital tokens as a payment for actual goods and services. As a transactional payment API, the platform strikes a fine balance between consumer protection and convenience.

That being said, the company has yet to offer any implementation details, leaving investors unable to truly verify the claims. Although this is expected to be resolved sometime next year when the platform launches, it is something investors should bear in mind.

Risks

  • A lack of implementation details or working prototype. -2
  • The whitepaper states that the platform converts cryptocurrency into fiat and holds it in escrow until it is released to the seller. However, no information on the escrow feature is provided. -1

Growth Potential

  • UTRUST is operating at the forefront of the cryptocurrency payment arena, which gives it unique first-mover advantage in a rapidly expanding market. The lack of cryptocurrency payment options is a major issue that UTRUST is trying to resolve. +6
  • Sellers will be delighted to learn that they can receive payments in fiat currency. This gives them the opportunity of serving the cryptocurrency market without having to actually set up a crypto account. +2
  • Hugely successful private raise suggests investors are extremely passionate about the project. +2

Disposition

If you’re bullish on cryptocurrency, UTRUST is the opportunity to put your money where your mouth is. Consumers are craving a PayPal for cryptos, and UTRUST is delivering. If crypto payment processing is as coveted as industry proponents say it is, then UTRUST provides huge potential.

Against this backdrop, we give UTRUST  a rating of 7 out of 10. We feel this rating is justified given the prevailing gaps in the crypto payment arena, and the role of UTRUST in filling an important niche in the market. UTRUST essentially gives merchants access to a growing audience of cryptocurrency holders. For buyers, UTRUST provides a safe, reliable and secure platform for actually buying goods and services in cryptocurrency.

Investment Details

To participate in the UTRUST token sale, click here.

  • Project Type: Crowdsale
  • Opening Date: Nov. 2, 2017
  • Platform: Ethereum (ETH)
  • Total Supply: 1 billion
  • Raise Limit: $50 million USD
  • Token Price: $0.065 USD
  • Accepted Tokens: BTC & ETH

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