There are two Protocols that are widely used today: Proof-of-Work and Proof-of-Stake, – they are perfect for cryptocurrencies. However, with the growing demand for improving the liquidity of assets, yet avoiding the cumbersome process bounded by the rules and regulations of the traditional stock market, a new measure has paved the way for evolution. BANKEX is proud to present their Proof-of-Asset protocol. This technology enables information to be passed on in real time directly into the blockchain.
[Note: This is a sponsored article.]
What is BANKEX Proof-of-Asset Protocol?
By exploiting the technologies of the Internet of Things (IoT) and Artificial Intelligence (AI) BANKEX is building its Internet of Assets (IoA) on the foundation of Bank-as-a-Service (BaaS). The BANKEX team is aimed at delivering a Proof-of -Asset (PoA) protocol which will be considered an industry standard for creating new decentralized capital markets in various business sectors.
BANKEX PoA protocol will be available for third-party fintech providers, such as AI and IoT labs, traditional financial institutions and most importantly a wide variety of asset owners.
BANKEX technology is set to changing the way ordinary transactions are carried out by making them clearer, faster and much more reliable.
Tokenization is the process of protecting sensitive data by replacing it with an algorithmically generated number called a token, much like a website domain is a representation of an IP address on the internet, a token is a representation of information on the blockchain. By processing this information BANKEX PoA can perform actions that would usually require a third party for verification. Simply put – tokenization of assets is basically the process of passing on the rights to an asset into the blockchain and making it globally available. BANKEX tokens carry both functions: utility and security while serving as a gateway to the platform they are also backed by real-world assets.
Currently, financial markets are faced with several problems that lead to lower liquidity of assets, here are just a few that BANKEX attempts to fix:
- Numerous asset owners – this creates barriers to effective communication, making it harder to reach common ground.
- High dispersion of an asset – this results in blurred understanding of cash flow, that is generated by every single asset.
- Long period to launch projects and achieve desirable liquidity.
- Inability to enter the financial market and attract sufficient investments for non-public companies.
- Complicated process of tracking the lifecycle of an asset up to generation of cash flow.
- High legal and accounting expenditures caused by asset transfers when early investors sell their assets at peak profitability.
- Complexity of asset withdrawal if the terms of contract are not fulfilled.
In order to tokenize an asset, the company needs to ensure that said asset generates cash flow.
How It Works
BANKEX serves as an ecosystem that combines Bank-as-a-Service, PoA protocol, and blockchain technologies.
Bank-as-a-Service is a model, that enables offering fintech services without creating brick and mortar financial institutions. By using APIs and going through technical processes, BaaS provides the possibility for creating new financial products for various business sectors. Currently, FinTech is going through a stage of rapid evolution. Using a BaaS model will help FinTech companies and businesses reach their potential. Decentralization, which is available with blockchain along with Smart Contracts can solve the problem of lost trust, associated with modern banks.
In general, 3 entities are involved in the process:
- Originator – the owner of an asset.
- Supplier – the purchaser of the tokenized asset, i.e investor.
- Product owner – the company that creates fintech products as well as provides technology for tokenization, e.g. BANKEX.
Everybody wins: originators are granted new business opportunities, suppliers can increase their investment portfolio, and product owners benefit from conducting transactions between originators and suppliers.
The Process can be broken up into 4 stages:
|1. Digitization||all available information regarding the asset is collected and verified by BANKEX before it is entered into the Smart Contract; at this stage all the legal and accounting issues are addressed, analyzed and if required, resolved.|
|2. Tokenization||Step 1 – The gathered information is placed into an Ethereum Smart Contract.
Step 2 – The Ethereum Smart Contract is transformed into a Smart Asset. During this step, BANKEX provides escrow services. A token is created.
|3. Asset trading||Step 3 – The newly created token goes to market. The token has to comply with a set of trading rules in order to be listed on the market, i.e. it has to pass a set of filters that are vital for verification.
Step 4 – Here the price is adjusted based on to the market offer. The smart contract is put on the BANKEX market.
|4. Dealing||During this step it is important to make sure that the Token is guaranteed to be delivered to the supplier (investor). This process is carried out by Proof of Mining. The result of this stage is that the product token is successfully delivered to the supplier (investor) and stored in his wallet, in turn, the BANKEX token is delivered to the originator (asset owner).|
The Proof -of-Asset protocol technology can be applied to various business sectors all over the globe. Let’s review a few possible applications. Target assets – assets with capitalization more than $100 million:
|Case 1||Case 2||Case 3|
|Sector||Real estate||Non-Profit: drinking water for Africa and India||Retail franchise network|
|Region||Hong Kong (China)||Africa, India, Russia, US||US and Russia|
|Client||International bank||Filter producer||Retail chain|
|Asset||Commercial and residential real estate||Frozen drinking water||The store’s cash flow|
|Token economy||Square meters of to be built apartments are used to back up tokens. Token price is stable. Project is on the go and the apartments are being built.
(1 sq.m. = 10 tokens, One 100 sq. m. apartment =1K tokens)
|Charity donors are to buy water tokens
(1 token=1 liter of drinking water)
|The tokens are backed by revenue that is generated by royalties from franchises. Tokens can be used to purchase products in the chain stores.
(1 token = 1 product)
|Business case||Investors are given a liquid asset after the to-be-built real estate is tokenized.||In order to facilitate both the donation and donation tracking process. After the water tokens are purchased donors can track their journey to the end consumer.||To finance expansion i.e. open new stores. Token owners can buy products in the retail chain as well as take part in the company decision making process.|
BANKEX is supported by 10 banks and top tech companies, including the Microsoft Corporation. BANKEX is ranked in Top- 50 FinTech startups of the world.
BANKEX technology is considered to be successful by members of the blockchain community. During the open pre-sale, $10 million wase raised, while the amount of $1,5 million was reached at the pre-ICO stage.
Further information on BANKEX is available at:
What do you think of BANKEX’ Proof-of-Asset protocol? Let us know in the comments below.
Images courtesy of BANKEX