There has been a great number of cryptocurrencies making Initial Coin Offerings (ICO) and offering their “coins” or “tokens” for “crowdsales,” selling “coin” shares of their company, and making them available to be traded via cryptocurrency exchanges shortly afterwards. A friend recently brought Ubiquicoin to my attention, noting the “unique” properties of the coin:
The financial guarantee provides all Progressive Coin holders with real, quantifiable downside protection equal to $1.00 per Progressive Coin. The guarantee scales with the size of the ICO, so if 100 million coins are sold in the ICO the guarantee is $100 million. If 200 million coins are sold, the guarantee is $200 million, and so on.
Perhaps an even more valuable asset than the infrastructure the Subsidiary provides is its strategic relationship with tier one financial institutions across the globe. Additionally, it has been actively expanding internationally to provide small saver investment services to areas such as the UAE, and it is currently exploring partnerships in China, Singapore, parts of South America, and Eastern Europe, to name just a few.
After reading through the whitepaper, it appears Ubiquicoin is trying to be “unique” in a way that many other coins aren’t. Ubiquicoin is using the blockchain to directly target point-of-sale (or transfer) transactions, offering some unique ownership functions and financial guarantees that could actually cause the currency’s widespread adoption.
In essence, Ubiquicoin is implementing a blockchain system which functions without miners.
“Proof of work” coins (such as Bitcoin, Litecoin, and others) require miners to perform “tasks” with computer hardware to mint coins. Proof of work is wasteful in many ways, and Ubiquicoin has taken a different approach. To understand how, take a look at Ubiquicoin’s structure:
If you don’t feel like sitting through a video over one minute in length, take a look at the below excerpt of the whitepaper:
So there are two separate types of Ubiquicoins; the transactional (BIQT) and progressive (BIQP) types. So the transactional coins will (likely) not gain any intrinsic value, and will merely be used to facilitate transactions on a peer-to-peer basis over a secure system. The progressive coins are for the speculators who care to invest or trade based on the actual “success” of Ubiquicoin as a whole, and not meant to be used in transactions. 20% of the “fees” or “mining costs” would accrue to the progressive coin holders.
The major use case of Ubiquicoin is in subverting credit card companies by providing a peer-to-peer exchange system that is backed by hard assets. If a transactional token is always worth $1, but provides a far lower transaction cost than the existing credit system, this could quickly facilitate a move away from credit/debit cards and towards Ubiquicoin.
Given the use of crypto in other nations, this could be a double whammy; providing secure transactional services without the need to use miners. Venezuela is the case study on how cryptocurrency has worked as a “hedge” against hyperinflation; Venezuelans are not only using Bitcoin as a store of value, some vendors are accepting bitcoin exclusively as payment:
Bitcoin’s popularity in Venezuela continued to grow. It became the country’s leading parallel currency. Some vendors even begun accepting Bitcoin exclusively. A popular online travel agency, Destinia, cited that, due to the bolivar’s instability and the trouble many Venezuelans experience when attempting to leave the country, “Giving priority to Bitcoin as a payment method could be of help.”
…and as the case of Venezuela illustrates, cryptocurrency can help citizens of a hyperinflationary economy find a more portable, stable form of purchasing power. However, “decentralized” cryptos always have “at-risk” mining operations:
The Venezuelan government began to crack down on the Bitcoin community, with police extorting citizens for “misusing electricity” or undermining the country’s economy. These grievances intensified over time, however, and the attack on miners became more apparent. In the largest raid, two miners were caught with 11,000 mining computers and were charged with cybercrime, electricity theft, exchange fraud, and even funding terrorism.
In Feb. 2017, following the incident, Surbitcoin, Venezuela’s most popular exchange went offline. The company encouraged users to withdraw their money immediately as Banesco, the company’s banking partner, was set to revoke the account associated with the exchange. Rodrigo Souza, the founder and CEO of Surbitcoin, noted that “When it was found that there were 11,000 mining computers consuming the energy to power a whole town at a time when there are severe electricity shortages, it triggered a reaction.” Souza went on to say that the company was not contacted by the government, but Banesco revoked their account as it did not want to be associated with such an operation. Surbitcoin resumed operations two weeks following.
If Ubiquicoin becomes a widely accepted medium of exchange, the progressive coins could serve the function as a store of value. The transaction costs would safely accrue to the progressive coinholders, without the need to “mine” the product, much like interest or a dividend. Furthermore, the “transactional” tokens could serve the “medium of exchange” function traditionally performed by currencies, with the transactional coins presumably holding their value against the dollar.
It is worth noting that Ubiquicoin is not without its flaws. Most importantly, it is not the first cryptocurrency to attempt to subvert credit card and other point-of-sale transactions. Bitcoin itself is the original, built on a trusted and reliable blockchain that hasn’t failed even slightly in nine years. Cryptocurrencies such as Litecoin, Monero and others have faster transaction times and lower fees than Bitcoin, already one-upping its utility. Ripple (XRP) already has a functioning centralized blockchain and a vision that is similar to Ubiquicoin’s, but Ripple already has significant banking partnerships in place.
Ubiquicoin could just end up being another failed ICO; arriving to the party too late, and potentially having other issues that haven’t been communicated in the whitepaper. There are plenty of other existing cryptocurrencies that could supplant credit cards instead of Ubiquicoin. However, Ubiquicoin’s structure could provide enough innovation to overcome the inherent barriers to entry that already exist in the cryptocurrency space.
In this world of failed ICOs, with celebrity endorsement sometimes being enough to pump inferior projects, nearly all ICOs and cryptocurrencies are not worth considering as investments. However, given its innovative structure. and the fact that it is backed by real-world assets, Ubiquicoin is one ICO that I’ll be keeping a very close eye on.
Disclaimer: While I own other cryptocurrencies, I own zero Ubiquicoin, but am considering investing in the project.