Vitaly Belekhov Discusses Ahedgefund Project And Liquidity Issues On Cryptocurrency Market
Tell us about your project. What is it aimed at?
We want to turn the existing tool, which is successfully used in the traditional financial market, into a powerful mechanism that could be used in the cryptocurrency market. The tool I'm talking about is the credit default swap. It helps investors to protect themselves from rates fluctuations, from unfair ICO projects, etc.
How will this tool operate in the cryptocurrency market?
It can be compared to insurance. The client refers to a guarantor (for example, an investment bank) to get insurance against fluctuations − for example, in the US dollar and euro exchange rates. The guarantor sets a price, which depends on market conditions and expert estimates. After that, young teams can easily start a new business while investors can invest in these projects without fear or doubt.
What technologies do you use?
We plan to use a ready-made software. And we have to adapt these mechanisms to the needs of the crypto market. This includes both programmatic and mathematical changes, as these two markets are quite different. At the moment, we are raising funds for more serious developments. Though, we have enough money to start creating a beta version of the platform.
Why do you think that your product will be successful?
Many people say it's bad that such a project does not exist yet. We see real problems, and our system is able to solve them. We already have a client base, and it keeps growing. Still, not everyone is ready to invest in cryptocurrencies, many people do not dare to put their ideas into practice, as there are a lot of real risks they may face. As a rule, ordinary projects do research on the market to understand what point is the best to start at. But ICO-projects cannot do this, they have to stick to their plan and strict deadlines. We believe that our product will help stabilize the market. To begin with, we want to solve the problem of fluctuation in the rates of bitcoin and ether. We want our investors to receive substantial dividends from the very beginning.
Why does the problem of high volatility exists in the crypto market?
This market has the lack of capital yet. Roughly speaking, a person who has $10 can destabilize the rate of any small cryptocurrency.
Where are you based?
Our development team is based in Novosibirsk. The company itself is registered in Switzerland. Our CEO is Italian, the director is Russian. By the way, our director is known in Russia as the founder of the BioTechnopark Koltsovo. We have a lot of finished projects. Since our company is registered in Switzerland, we comply with the requirements of the Swiss regulator and the US Securities and Exchange Commission (SEC).
Why did you start working with the US regulator? Do you have any obligations to it?
We work with the US clients. That's why we had to undergo the licensing by the local regulator. In fact, they consider our tokens as securities with dividends. Once the project is launched, our customers will start buying insurance and all profits will be halved. The first part will go to top up the fund, and the second one will be used as dividends.
The number of existing cryptocurrencies and tokens is huge. Will this sphere change somehow in the nearest future?
I think the number of tokens and cryptocurrencies will grow. But there is a technological problem. There are projects that already develop technologies to cover all spheres. For instance, there are people from large corporations who know perfectly well what the market actually needs. So they create projects based on various blockchains and try to make their technologies more widespread.
At what stage is your project now?
We plan to start the ICO in late July to raise money for the guarantee fund. Now we are at the presale stage. We already have money to develop the first version of our product. The more stabilizing tools we can provide and the larger our client base is, the stronger influence our product will have on the whole sphere.
Do you have competitors in the market?
I have not come across successful projects of this type yet. There were attempts. I know two of them. But they have stopped their activity. The main problem of most teams is that their staff mainly consists of developers. Their products might be good, but they don't know how to promote the projects or how to raise money. Any team has to make a good business team to succeed.