- Project name: FIC Network
- Token symbol: eFIC
- Website: https://ficnetwork.com/en
- White paper: https://drive.google.com/file/d/0ByzKCCWTHkioZzRhTThXSi0zcWM/view
- Hard cap: $16 million (ICO Participants receive 50% of total token supply)
- Conversion rate: 1 eFIC = $0.10
- Maximum market cap at ICO on a fully diluted basis: $32 million
- Bonus structure: Private sale received 60% bonus, presale receives 30% bonus
- Presale or white list: Presale ongoing, whitelist here: https://ficnetwork.com/en/token
- Blockchain platform: Its own blockchain based on a Stellar fork
- Countries excluded: Presale for US accredited investors only, public sale TBA
- Timeline: Presale ongoing, public sale begins April 16, 2018 (Please refer to FIC Network’s website for the most up-to-date information)
- Token distribution date: After public sale
Video summary (video is 6:29 long):
What does the company/project do?
FIC Network is a decentralized fixed income securities network that enables the listing, exchange, and securitization of fixed income financial instruments including corporate bonds, syndicated loans, asset-backed securities, and more.
By implementing blockchain, FIC Network expects to offer benefits to current fixed income investors over traditional fixed income securities markets listed below.
Transactions made on FIC Network will be immutable, and users will also enjoy lower costs from the removal of intermediaries in their market. Users will also benefit from the speed of transaction settlement, as exchanges can be done in seconds as opposed to days or even weeks.
The primary new feature that FIC Network aims to bring to the fixed income securities market is the introduction of Expected Cash Flows (ECF) as tradeable repayment options. ECFs allow investors to slice the cash flows of the loans any way they want (by maturity, interest or principal portion, etc.).
Therefore, they can select specific repayments across several loans to diversify risk or fine-tune their cash flow requirements to specific payout periods.
The diagram below shows how FIC Network functions in a nutshell:
As shown in the diagram above, lenders would first need to originate a loan before it can be listed on FIC Network. Investors will then invest fiat or crypto into the loans listed on the exchange.
The ECFs are initially tokenized on the FIC Network, but the plan is to be able to trade the ECFs on other platforms in the future.
How advanced is the project?
Factury, the company behind FIC Network, was founded in 2016 and started building out the core team in Q1 2017. It is headquartered in New York City and has an office in Latvia. It has received funding from three institutional investors: Boost VC, Startupbootcamp Fintech NYC, and Bialla Venture Partners.
In Q3 2017, the testnet and Alpha version of the platform was launched. Currently, a few institutions are testing the platform. The demo can be downloaded here. Below are screenshots of the demo:
Here is a summary of their roadmap:
- Test with Network Participants on Testnet
- Cryptocurrency implementation
- Implementing the ability to trade single ECF separately
- Listing and trading of corporate bonds
- Listing and trading of other financial instruments
What are the tokens used for and how can token value appreciate?
eFIC tokens are used in order to publish financial instruments as well as bid for ECFs on FIC Network. For certain actions (creating firms/users, listing loans, etc.), staking tokens are required while for other actions (sell whole loans), eFIC tokens will be spent and gone forever.
eFIC has a fixed supply, so as usage of FIC Network grows, demand for eFIC increases which can lead to an increase in the price of eFIC tokens.
As more users and lenders exchange financial instruments on FIC Network, the price of eFIC should appreciate.
The core FIC Network team consists of 9 members. The bios of key team members are listed below:
Arturs Ivanovs, CEO and Co-Founder – Ex-Marketing executive and senior project manager at Porter Novelli Latvia, Advisor to Turing Funds, previously worked at Latvia’s Ministry of Economy. Holds LLB in Law and Business from Riga Graduate School of Law.
Alvar Soosar, COO and Co-Founder – 20+ years of experience as an investor, Managing Director and Co-founder of Fisher Row Capital, previously managed a $7.8 billion portfolio of fixed income securities, MBA from University of Oxford.
Aigar Staks, Senior FIC Network Architecture Advisor and Co-Founder– Managing Director of Agile & CO, previously worked as a Strategy Consultant at Microsoft and was a Senior Consultant at PWC. M.SC. in Computer Science. MBA from Riga Business School-University of Buffalo joint program.
FIC Network’s advisors include: Matiss Ansviesulis, Co-Founder and CEO of Creamfinance, Jon Chou, Co-Founder and CEO of Bee Token, Ismail Malik, Chairman of Blockchain Lab, as well as others.
- The credit market is huge. It is not as much talked about as the equity (stock) market but it is actually bigger. According to The Motley Fool, the global bond market beats the stock market in both size ($100 trillion vs. $64 trillion) and daily trading volume ($700 billion vs. $200 billion).
- We believe tokenization of credit instruments is just as viable as equity securities. FIC Network has the first mover advantage in this huge market.
- FIC Network has attracted 3 institutional investors, meaning that the company/team has passed the scrutiny of these investors.
- The company is showing good business traction with multiple institutions already testing out the Alpha.
- The team and advisors are solid with a balanced mix between entrepreneurs, finance executives who can help drive adoption of the platform, and developers.
- As bonds are securities, transactions around the underlying cash flow are also subject to regulations, which differ country by country. FIC Network needs to comply with each country that it operates in, so this could make expanding the platform and driving more users/bond listings slower than planned.
Our thoughts of the tokens for short term and long term are as follows:
For short-term holding: B
The idea, team and advisors, token metrics, and development progress are all outstanding. However, given the market condition, we are not as bullish on the short-term prospect.
The bonus amount is up to 60% which looks high in the first glance, but (1) it is only for less than 20% of the hard cap, and (2) public presale has 30% bonus, which effectively nets out the private presale bonus to 23%.
For long-term holding: A
Security token is believed to be (one of) the next big thing coming to crypto. It has the potential to catapult the overall cryptocurrency market size exponentially because basically every asset (stocks, real estate, commodities, bonds, etc.) can be tokenized.
However, the market is paying all the attention to the equity side (giving token holders the same rights as equity holders). Tzero, which is backed by Overstock, is in the process of raising $250 million, and Polymath has a market cap of $168 million.
Very little (if any) attention is paid to the credit side, even though the credit market is actually bigger than the equity market.
FIC Network has been in the works since 2016 – it has been a blockchain company from day 1. It has a first mover advantage with less competition compared to the equity side. Therefore, we believe it has a good chance to succeed.
We believe the upside is tremendous and fits well with the overall trend of where cryptocurrency is going.
For more information about the ICO, please visit the following links:
* The information contained in this article is for education purpose only and not financial advice. Do your own research before making any investment decisions.
This article is contributed by Victor Lai with the help of our intern Richard Wang.