Kevin answering questions about Margin Posting, TAM, debit cards, funding and more.
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Mnuchin, Secretary of the Treasury, didn’t actually say this. What he said was that one of the things the Treasury does, is ensure AML policies are followed between all levels of finance, to track funding/terrorist funding/criminal activity. Not applying critical laws to crypto could make it a national security issue, and Kevin agrees 100%.
“No s*** Sherlock” – statement of the week. Obviously they won’t launch before then, because they wouldn’t be able to. Libra is structured as a hedge fund, and kinda as a central bank because it can create monetary policies on an asset that could be traded or used by one of the largest populace masses, and able to monetize it by holding reserves. This will likely change a bit and this is how they get around the issue.
Kevin thinks each new story from Bitfinex is BS. Billion dollar token raise right after being told there’s an $850m hole, printing a billion in tether, accidentally printing 5 billion when meant to print 50 million – these guys are ridiculous. If they can sell a billion then selling $5m – so what. Kevin thinks these guys are just covering holes.
They didn’t give the nod, what they’re saying is that financial entities have to segregate capital according to an act from the 70’s. In the client segregated account under US law, they’re not like trust accounts, the company still has access. It just means from an accounting perspective, or from a risk perspective – If company goes bankrupt the funds in the clients’ accounts can’t be used to pay the debts of the company.
Kevin had this discussion with Roubini when they sat down together. Roubini is talking about BitMEX for the most part, highly leveraged non-regulated assets. BitMEX make a ton of money on liquidations. Kevin says Roubini is a 100% correct. People love to use the word ‘scam’ – it’s not a scam, it’s an unregulated market that is being targeted towards people that they know would lose money and it probably shouldn’t exist.
What’s new on funding?
In the process of finalizing a proposal for an investor that’s actually on both sides – CoinMetro and CSD. That’s a large ticket, split between both entities. So it’s not everything we’re looking for in phase one, which is the initial proposal, phase two would cover absolutely everything that we’re looking for – probably six months from now, capital that would come in from phase one would cover us for all of those six months, and allow us to delve into a few extra projects.
There’s also a similar proposal that probably will go out next week to some investors based in Europe. Then dealing with a phone call with a group of other investors also based in Europe.
Any thoughts on security token offerings/IEOs on CoinMetro? As a regulated platform, would you be able to offer trading of securities alongside other coins and pairings with tokenized assets?
One of the main reasons for the MTF sandbox and the CSD on the infrastructure side, is that CoinMetro will have the only native token capital market infrastructure.
That means security tokens. Tokenized securities. Listing of debt (bonds, corporate bonds, other types of bonds), equity, shares, shareholders, revenue share structures, all types of different securities. We’d be the only complete ecosystem for a global capital market infrastructure for tokenized securities. If you don’t understand how big that is, it’s HUGE!! The probability that tokenized securities become larger than the overall commodity, securities, and equities market – is very, very possible. That’s trillions, and trillions, and trillions. It’s a huge play. The IEOs, next week or the week after, we will be able to make a preliminary announcement about how our system is going to be setup and who the first client will be.
Do you have any exclusivity protection when you share with the authority in Montenegro on the CSD stuff?
We share with them enough to show what we’re planning to do, not sharing anything proprietary that would allow them to do this on their own. There will be NDAs in place, we will have some type of protection inside the sandbox, meaning no other company with the exact same offer would be able to come into the sandbox, meaning there wouldn’t be multiple CSDs in the same sandbox.
When is TAM and Margin Posting being released?
Margin Posting is actively being worked on right now. TAM is also being worked on. Margin posting probably happening first, about 4-6 weeks. TAM would follow after that.
Any news on debit cards? Will there be tiers based on amount of XCM you hold?
Working on new designs right now. First edition will be plastic card, subsequently will release a metal card. Different pricing structures. More than likely some type of scheme where holding of XCM will give you discounts on the purchase of the debit card, or maybe even a free card, and perhaps even discounts on the fee structure itself.
Public API status?
Talked about this with the CTO last week. Non-FIX API is ready to roll, but not documented. FIX API is just about ready to roll, but in terms of being able to bring on market makers, has been done for a while – that is how we have liquidity that comes in externally. FIX API that people can connect in to trade – almost done, needs to be documented. Once we dive through Margin Posting, we will get both of those ready, 4-6 weeks from now.
Any plans on having virtual debit cards as well? Having sort of the full range of Revolut services.
Yes, virtual will probably be part of the package as most card providers already has APIs built-in. Whether it gets released right away, depends on demand. Kevin would like to get away from cards, and use NFC, Google Pay, Apple Pay and then our own App.
Any response from LHV?
No response from LHV. They are working on a framework so that we could self-assess, meaning we just have to make sure that each asset meets this self-assessment guideline. This is the best thing we could have hoped for.
Any news on the new fiat currencies?
Still working on the official launch date. GBP will likely be one of the first, probably followed by the Australian Dollar, and some Asian currency – maybe Singapore Dollar. When it comes to tradeability, Pounds will probably be the first. Working on a solution for USD, we may have a very unique stablecoin offering that will allow us to do a USD offering with a very unique stablecoin setup. News coming over the next couple of weeks.
When did you say you would implement XCM used for fees and % burned?
Full implementation of XCM for fees + percentage burn, will happen after the Margin Posting platform release, which is 4-6 weeks from now. That’s the schedule.
Does CoinMetro have Support Staff only in Tallinn, or are they spread around in different world?
Spread around the world. Our level two support staff sits in Tallinn, level one however is in different parts of the world.
So with this new Sandbox and MTF license, will CoinMetro be marketing to institutions and not just crypto retail?
The CSD is definitely an infrastructure play, which means it’s marketed towards issuers, and counterparties. So that means people issuing tokens, whether that be individuals, companies or corporations – mostly companies/corporations – and also targeted towards counterparties, like exchanges, and other counterparties that deal in either clearing or liquidity of crypto or tokenized assets. MTF is still retail guys.
The real scope is to get access to retail liquidity pools with these tokenized securities. The MTF will still be overly retail – doesn’t mean we won’t allow institutional guys to connect to buy and sell, because issuers are by effect institutional, by definition. Still a retail front facing platform.
When are we getting the new website?
I’ve seen the new website, mobile and desktop renditions – don’t know the timeline, but more than halfway there. August for sure.
What is your expected volume for the end of the year?
Depends. If the sandbox goes well, it could be massive. Sandbox gets slower than we imagined, I still think over half a million a day with spikes up towards a million, million a half a day. What will dictate that a lot is the overall crypto market, what volume looks like, what sentiment looks like.
With Margin posting, will we get higher leverage?
Yes, even without Margin Posting, higher leverage is the goal. We just need enough statistics, so we know how high we can push it and keep the negative balance risk on our side, to a minimum. Under rules in the EU, most of the times one is limited to 25:1 on most assets.
With the upcoming virtual IBANs would it be feasible (and a good idea) that my employer transfers my salary directly to my CoinMetro account?
Would you be able to do that? Yes. Should you do it? Up to you. Obviously those IBANs would be housed by a regulated entity, so they would be protected under the same insurance as any IBAN of that issuing country, meaning government insurance should anything happen to the issuer of those accounts. So there’s really no difference in that respect of going to a bank.
Do you think that CoinMetro services are soon in place in order to ramp up marketing?
We’ll get there, soon is a relative term. I know everybody thinks that a year or two in terms of business is like a century, because a lot of people who came into this, it’s their first investment where any crypto projects either went to s*** or to the moon in 2 months.
In the real world, look at any success history – Amazon, Google, – any company that had to go and build massive infrastructure, nothing was done in two years.
Marketing is very important. We’re coming at this from a fully regulated angle, and coming from the bottom up and kinda take over a larger market share when regulation really start to pinch all those other operators.
I have never seen a founder or CEO who communicates so openly and is so approachable. My question: can you give an update on user numbers? Telegram community seems to be quite active and stable and even on other Social Media channels numbers are growing. But I don’t know if these numbers are a good indicator for real user numbers. Many thanks!
They are a decent indicator. When you see social media growth, we’re also seeing very similar growth in terms of new user accounts. Largest to date month in new user accounts, was roughly 2000 new users, May to June. Our numbers are increasing on average month to month, as our social media is also increasing.
You said you will ramp up marketing activities as soon as the platform and new products are ready? I see you are currently recruiting for marketing positions. Do you still own the majority or a significant stake?
I am still one of the majority shareholders, I own more than 1/3 of the company.
We are recruiting because we need new people, still waiting on that larger ticket to push out marketing. It will be a process, will have to bring in new people, that will take a bit of time. Constantly looking into the future, we don’t sit idle here. Whether it takes time or not, depends on what we’re doing.
Ephemeral is a word that originates from the greek and means “it doesn’t last that long” – temporary, so ephemeral layer is a software layer that basically holds data that deletes itself – it’s mutable data. Basically a message system, where the message only lasts long enough for the receiver to see it, that could be a machine – and act upon it, then it’s permanently deleted.
Want to know more? Check for more details in the video below.
Get the complete scoop by tuning in to our audio version of last week’s TWiC on SoundCloud. Happy listening!
Well, that’s it for this week’s AMA with CoinMetro Founder Kevin Murcko! Please join us next week on CoinMetro’s Facebook and YouTube Channels at 12:00 (UTC) for another round and make sure you submit your questions to the CoinMetro subReddit!
As always, we’re available to answer any questions you may have on our Telegram Group 24/7.