Analysis of UTRUST – Future of Online Payments - Crush Crypto

Analysis of UTRUST – Future of Online Payments

Summary

  • Project name: UTRUST
  • Token symbol: UTK
  • Website: https://utrust.io/
  • White paper: https://utrust.io/whitepaper/en
  • Hard cap: US$49 million (public crowdsale ICO contributors own 70% of total token supply if hard cap is reached)
  • Conversion rate: 1 UTK = US$0.065
  • Maximum market cap at ICO on a fully diluted basis: US$70 million
  • Bonus structure: No bonus for crowdsale
  • Presale or white list: Presale is over
  • ERC20 token: Yes
  • Crowdsale date: November 2nd at 2PM UTC (please refer to UTRUST’s website for the most up-to-date information)
  • Token distribution date: After the KYC verification process is completed
Video summary (video is 9:29 long):

Project Overview

What does the company/project do?

UTRUST is a payment platform that allows online merchants to accept all the major cryptocurrencies as a form of payment.

Compared to the traditional payment methods (credit card, PayPal), UTRUST provides several advantages – lower seller fees, safety of funds, no chargebacks, and comprehensive customer payment protection.

Here is now UTRUST works in a nutshell:

When the buyer selects UTRUST as a payment method, he/she can choose to use funds from any of their existing cryptocurrency wallets as a source of funds or use their UTRUST funds.

The buyer will be shown a description of the total amount to be paid, including a 1% commission and conversion fees from crypto to fiat. The buyer completes the transaction and the amount is sent to UTRUST. The UTRUST system converts the cryptocurrency amount to fiat and holds it in escrow until it is released to the seller.

The duration of this hold period will vary depending on the merchant performance history and ranges from almost immediately to a few days. As the merchant establishes a track record of successful transactions, his performance rating will increase and the hold period will decrease.

If there is a dispute, the buyer can escalate the issue. Both parties enter a self-resolution chat, where they try to amicably come to mutual agreeable terms. If both parties do not come to terms in 7 days, the buyer has the option to escalate the claim to a mediator.

An UTRUST operator joins the chat resolution and serves as mediator and arbitrator with final say on the dispute outcome. Proceeding with an escalation will incur a fee of 2% over the amount in hold if a buyer refund is issued by the UTRUST mediator.

Here is an explanatory video of UTRUST (video is 2:41 long):

How advanced is the project?

The project does not have proof-of-concept yet. Below is the future milestones of the project.

Q2 2018 – Platform test API for merchants

Q4 2018 – Platform release

Q1 2019 – platform refinements & expansion

What are the tokens used for and how can token value appreciate?

UTRUST tokens can be used to purchase products/services on the platform. If users choose to pay via UTRUST tokens, there is no conversion fees, otherwise, there is a low conversion fee applied.

Each time a buyer pays with any cryptocurrency via the UTRUST payment platform, a percentage of the transactional fee will be used to buyback UTRUST tokens and those tokens will be burned.

The value of UTRUST tokens depend on how much the conversion fees are. UTRUST needs to strike a balance – if the conversion fee is too high, it will provide a barrier for users which impacts the adoption of the platform; if the conversion fee is too low, the utility value of UTRUST tokens would be very little because users can just pay with other cryptocurrencies instead of UTRUST tokens.

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Team

UTRUST has a large team of 16. Bios of the key members are listed below:

Nuno Correia, CEO – early cryptocurrency investor who has been involved in the cryptomarkets since 2011. Founder of multiple B2C businesses.

Filipe Castro, CIO – has experience developing electronic payment systems and other software solutions during the early days of his career.

Arthur Goulao, CTO – former CTO of Easypay, a digital payment platform, software engineer of Simple Solutions, Head of Research and Development at iSimplex.

Roberto Machado, CPO – Founder and Product Manager at several startups prior to UTRUST. Previously, he has worked together with major international companies such as AT&T, Betfair, Airtel and Uphold.


Opportunities

  • Cryptocurrency payment has not been catching on because of the rising Bitcoin transaction fees. However, with the growing popularity and much lower transaction cost of Ethereum, especially after the Byzantium upgrade, we believe the time has come where Ether can become a viable cryptocurrency for online payments.
  • The online payments market is large with huge potential. If UTRUST can be successful, they have the potential to process billions of dollar of transactions a year.

Concerns

  • There are other competitors in the cryptocurrency payment solutions space, such as Monetha, Request, Coinify, CoinPayments, BlockPay, Cryptonator, and BitPay. UTRUST may not be the winner in this industry.
  • UTRUST has no merchant support so far, which is lagging other competitors.
  • Other blockchain projects working on merchant payments such as Monetha and Request are trading at a sub-$35 million valuation, which makes it hard for UTRUST to obtain a high valuation.
  • $3.5 million was raised during previous rounds at heavy discounts ($2 million at $0.02 per token and $1.5 million at $0.03 per token). Those participants have experienced a long lock-up period due to the delay of ICO from September 2017 to November 2017, which may cause these participants to dump their tokens below ICO price of $0.065.
  • The gap between pre-ICO (August) and ICO (November) should give the developers more time to come up with a minimal viable product. However, this is not the case. There is no proof-of-concept developed despite the team claiming that they are ahead of schedule in terms of development.
  • The platform is not going to launch until Q4 2018, which 1 year after the end of ICO. In the meantime, there would not be much catalyst for token prices.

Conclusion

Overall, we are negative about this ICO’s short-term potential and neutral about its long-term potential. Our thoughts of the tokens for short term and long term are as follows:

For ​short-term holding

Negative. As mentioned above, $3.5 million was already raised at over 50% discount. Also, the high hard cap of $49 million will back fire, especially in this market environment, causing even less participants to contribute. We believe tokens can be bought at lower than the ICO price after trading.

For long-term holding

Neutral. We are not sure if UTRUST will win among the competition. In terms of getting merchants aboard for accepting cryptocurrency, UTRUST is falling behind Monetha (which secured multiple partnerships with large merchants) and Request (which can tap into the massive YCombinator network).

UTRUST is more competitive in terms of fees but it is not the only factor – Paypal is notorious about their high fees but they are still the market leader.


For more information about the ICO, please visit the following links:

Website: https://utrust.io/ 

Whitepaper: https://utrust.io/whitepaper/en 

Blog: https://medium.com/@UTRUST

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