BrightCOIN Sets Up A Turnkey Solution For Initial Coin Offerings
BrightCOIN is billed as a Kickstarter for ICOs. It offers a turnkey SaaS solution that enables blockchain companies to create their own cryptocurrency and launch an ICO in minutes, and at no initial cost.
However, the company is taking exceptional precautions on its identification requirements for access to the platform.
Entrepreneurs using the BrightCOIN platform will be carefully vetted to insure legitimacy. As part of the stringent process, company founders will not only have to produce verifiable personal identification (including both government issued picture ID and passport), but also must be photographically screened with special technology that can detect any Photoshopping, searched on international sanctions lists and terrorist watch lists, analyzed with anti-money laundering technology, and carefully scrutinized social media profiles, just to name a few.
Founder and CEO Vince Mundy and SVP Wayne Rosso talked with Block Tribune about the process.
BLOCK TRIBUNE: So, it sounds to me, Vince, that this is a pretty turnkey operation. I can just show up and basically within 15, 20 minutes, I can have my ICO underway. Is that the case?
VINCE MUNDY: That’s exactly the case. Most of our competitors – and this is how we differentiate with them – those guys are custom bespoke shops. We are the first built totally turnkey. You come in, you log in, as long as you know what you want to set up, you can basically build an ICO within 3 to 10 minutes.
BLOCK TRIBUNE: What sort of information do you need to know before you start?
VINCE MUNDY: There’s two kinds. One is the stuff we need just to set up the ICO. Second is the extra information we take to ensure the founder is legit and the ICO is on good grounds. From a technical standpoint, we need things like, what’s your coin symbol? What’s the price of your coin? How many coins are you issuing? And then, what’s your soft cap, your hard cap? What’s the discount you’re giving per period? It differs from the pre-sale to the mean sale and all the periods within the mean sale. What happens after your coins are distributed? Or what happens after your ICO ends? This is where the token generation event happens and all the coins are distributed. We burn all the coins, which weren’t sold.
So we ask for all that information. Once that is done, the additional steps we take is this is the founder KYC and the company KYC comes in. We vet our founders. We ask them to give us their passport pictures, a selfie with the passport pictures. We look at their LinkedIn. We verify if the LinkedIns look like something that was made two days ago, or is it a LinkedIn that looks mature? Does it have recommendations? We look at them in social profiles. We basically verify the identity of the person. In addition to all this, we also collect the incorporation documents of the company that is going to be doing the ICO, so we have all our bases covered. And this is just for the founder’s level.
BLOCK TRIBUNE: How can you can do that and everybody else can’t? What are you doing that’s so different?
VINCE MUNDY: No, others can do that. From a KYC standpoint, others can do that. But what’s happening is these other ICOs that are running are not running from platforms, they’re running independently. It’s basically a one-off founder coming in and saying, “Hey, I’m going to do an ICO.” Somehow patching it through together. Being a platform, the advantage is, we are sitting in the middle of all this, so we can get all the KYC, so on, so forth. Now from a technical standpoint, it gets a little trickier. From a technical standpoint, right from day one when we sat down, we sat down with our CTO. We came up with an architecture that would scale. When we saw the industry, we looked at it from a standpoint of what’s going to happen, not just now, but a year down the road or a year and a half down the road?
What we saw was, all of these (other) guys are charging half a million dollars or $200,000 to just set up the tech for an ICO. We saw that price going down. We wanted to democratize the whole process, so we came up with ‘Let’s do zero upfront fees,’ so the architecture of our software had to change. Let’s do zero upfront fees. We built the whole thing like a SaaS platform, which is really different than the way other people are setting it up. They’re setting it up from a bespoke, so they create the coin one client at a time and ours is just set up on the fly and ready to go, right off the bat.
BLOCK TRIBUNE: The coin that’s being created, will it be private to the company that’s creating it? Or will it be your coin that they’re using?
VINCE MUNDY: No, it’ll be private to the company that is creating it. It’s a full-fledged ICO with their coin, with their coin symbol, with the ability to get that coin listed in any exchanges in the future as well.
BLOCK TRIBUNE: Have you talked to the SEC about this?
VINCE MUNDY: We have been in talks with … well, from a regulation standpoint, our lawyers. From a legislation standpoint, to the guys at Wyoming, Tyler Lindholm who is running the legislation out there. The securities token exemption. The way we see it is the SCC, we always had the same view that the SCC would treat tokens as securities and we always held that view. We advised anyone that we talked to, to treat tokens sold to american contributors at securities and that’s what we stand by today and that’s exactly what the SCC came back and said. If you are taking American contributors, you have to take them as accredited investors and that’s the only way around it right now.
BLOCK TRIBUNE: Will your platform vet them automatically, or is that something that has to be done individually?
VINCE MUNDY: No, that is also linked into our platform. From a standpoint of the contributors giving in money, we handle all KYC, we handle the anti money laundering as well, so we do both of those pieces. On top of that, we also do the investor accreditation. Checking the tools or checking their financials to make sure that they qualify as an accredited investor, is also checked by us.
BLOCK TRIBUNE: You’re not taking any money upfront. So what is the ultimate cost of the service?
VINCE MUNDY: The cost of the service is basically nothing upfront. It’s built in a similar manner as Kickstarter, where after you are successfully funded, after a campaign hits its soft cap, we take a percentage of their total funding amount. The percentage varies. At present, we are saying 5% of the total take comes to us. This, of course, is for smaller ICOs. Larger ICOs, we have a slab that’s basically goes down in pricing as they raise more money.
BLOCK TRIBUNE: Are there other revenue streams for the company?
VINCE MUNDY: At present, this is the only one.
BLOCK TRIBUNE: Okay, do you anticipate anything in the future like advertising?
VINCE MUNDY: In the future we are actually building a full fledged ecosystem around ICOs. Not just handling the tech piece of things, but also handling the requirements of ICOs. If they’re looking for people who could help write their white paper or graphics for their website or just advice on which advisers actually prove their worth. Our review system, if you will. Those kinds of features will be added into the platform.
BLOCK TRIBUNE: Do you have a timeline on when those might appear?
VINCE MUNDY: I think those will be closer to Q3 of this year.
BLOCK TRIBUNE: Okay. Now you’re launching in April. Has the system been beta-tested already?
VINCE MUNDY: The system actually has people already on it right now. We’re doing live demos to people. The system is all ready ready to go.
BLOCK TRIBUNE: Today there was a notice where Japan came out against the Binance exchange regarding them not being registered in Japan. How will that sort of regulatory concern affect what you do and what’s your recommendation?
VINCE MUNDY: Our view is, I think regulation is good, but the space does need regulations. There was that hack that happened a few months ago with $400-plus million dollars being stolen from a Japanese exchange. Our view is regulation will help. It will prevent hacks from happening, it will make sure everyone within these exchanges is fair and compliant. We are all for regulation. I think regulation is the only way forward.
BLOCK TRIBUNE: Okay. Now, are you planning an ICO?
VINCE MUNDY: As of right now we’re not talking about our ICO. We’re just talking about the product right now.
BLOCK TRIBUNE: Okay. That means what, you’re not doing one? Or you are contemplating one?
VINCE MUNDY: For the record, we are contemplating one.
BLOCK TRIBUNE: Okay, fair enough. I think that answers all my questions. Do you have anything you want to tell me about that I didn’t ask about?
WAYNE ROSSO: I have something I want to just illuminate a little bit. You know we’re talking about the one thing that we’re doing that nobody else does is that we’re doing the extreme vetting of founders. Who’s doing that? Nobody. Because you’re a founder, you launch your own ICO, nobody knows you’ve been vetted.
This whole business, essentially, is built on trust. The investors have to trust that they’re being exposed to legit guys, not scammers. Because this is the wild west. Scamming is everywhere.
I think that’s what we’re really concerned about. Obviously, we’re going to screen the investors, et cetera, but we’re going to go that extra mile. I think over-compliance is the word. We want to go that extra mile in making sure that every founder who comes on the platform is 100% clean and legit. We want to be able to know that if something funky happens, we can shut them down right away and turn them over to authorities.
VINCE MUNDY: Let’s talk about the refunds.
WAYNE ROSSO: As part of our whole thing, we’re going to have a 48-hour cooling-off period for contributors and investors.
BLOCK TRIBUNE: In other words, like buying your car, you have 48 hours to turn it back in?
WAYNE ROSSO: Absolutely correct.
BLOCK TRIBUNE: If someone created a token already, can they come to your platform and be vetted and get the Good Housekeeping seal of approval?
VINCE MUNDY: If they’re running the ICO from our platform at present, yes. If they’re not running the ICO from our platform, we won’t be able to vet them.
BLOCK TRIBUNE: Okay, fair enough. All right.
WAYNE ROSSO: Interestingly, too, another reason why a lot of guys don’t do the KYC … A lot of them don’t do them in their ICOs because it costs a lot of money.
BLOCK TRIBUNE: I know. Yeah.
VINCE MUNDY: That’s another upfront cost to that we’re talking. Just to do the KYC can run between $5 to $7 per individual investor, going through a KYC and anti-money laundering. We’re presenting all of that with no upfront cost. We’re taking the cost on that. Again, just to make sure all of these ICOs follow the regulation standards that we’re putting in. Like Wayne said, we want to over-comply is our whole setup here.
WAYNE ROSSO: As a matter of fact, it’s something funny, because there is technology out there that can actually detect Photoshopping. We want to lay down the law. If a guy is legit, he won’t mind.
VINCE MUNDY: Yeah, our tech actually detects Photoshopping. We can actually detect if the ID that’s been presented has Photoshopping. Any kind of Photoshopping elements done, we can detect that. On top of that, we are asking for a selfie with the ID in hand as well, with the ID visible. Again, with our Photoshopping tech sitting on top of that, we’ll know if it’s legit or not.
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