Carboneum is creating a protocol for social trading and a democratized social trading platform.
Today, social trading is becoming increasingly popular and prevalent in the world of cryptocurrency, where “follower” traders follow and copy trades of more experienced “leader” traders. However, it is filled with problems, such as lack of transparency and unfair fee mechanism.
Firstly, all data, including leader-follower relationship and transactions, are kept in a centralized system which could well be subject to manipulation and error. Secondly, the centralized system has total control over the visibility of data, such as transaction records of leaders. Thirdly, the financial interests of leaders and followers are not aligned, as followers often have to pay a fee for simply copying trades, regardless of whether they make a profit or not.
Carboneum aims to solve such problems by providing an open protocol and a social trading dApp, Coinradars, on top of the protocol, creating a new infrastructure for social trading.
Using Coinradars, amateur traders can learn from and follow trading strategies of expert traders. In social trading, trust among users is critical and this is realized through decentralization. Carboneum protocol ensures that all transaction history is recorded on the blockchain, creating a transparent and immutable record. Moreover, the protocol executes the trading for the followers automatically, copying the experts, and takes the fee from them only when the trades make a profit, offering a fair fee structure for the stakeholders involved.
— Max Kortrakul, Founder & CEO
ICO Alert Quick Facts
- Decentralized social trading platform
- 1 ETH = 8,000 C8 token
- Pre-ICO: March 8, 2018 — June 10, 2018; ICO: June 11, 2018 — June 30, 2018
- 120,000,000 total available / 200,000,000 total supply
- Existing 500 Startups-backed company, which boasts a revenue-generating social trading app of over 680,000 downloads and a joint service with over 4.8 million users
Q&A with Max Kortrakul, Founder & CEO
ICO Alert: Can you tell us a little more about the company behind Carboneum?
Kortrakul: Unlike many ICOs, Carboneum is unique in that it is led by an established company, which is backed by 500 Startups, East Ventures and CyberAgent Ventures.
The company already boasts a revenue-generating social trading app of over 680,000 downloads and 10+ brokerage partners. Moreover, it has created a joint service with LINE, one of the biggest messenger app in Asia, with over 4.8 million users, allowing users to buy and sell stocks in the app.
It has received multiple awards for the success of our business, including the Financial Industry Application at APICTA, Angel Biz Challenge at Stock Exchange of Thailand New Venture Award, and the 11th IT Princess Award at FRIT.
Finally, it has a strong set of advisors as well, including the former Minister of Thailand (now the Head of Fintech Association), the CEOs of Tarad and Shift (two large companies in Thailand and South Korea).
ICO Alert: How does the C8 token function within the platform and why is it needed?
Kortrakul: C8 token works in a similar fashion to Binance’s BNB token.
C8 token will be used by follower traders to pay for fees to the leaders and the platform, receiving a 50% discount on the fees by using C8 token.
For holding a certain amount of C8 token, users will be able to access premium features and exclusive benefits, such as being able to follow certain popular leaders.
Based on this, C8 token is critical for the platform as it become the currency within the ecosystem, as well as allowing users to access features that will enhance their experience of social trading.
ICO Alert: What is your strategy for growing the user base? What is the context of the industry as a whole and who is the target audience?
Kortrakul: The industry as a whole is dominated by centralized social trading platforms and badly managed leader-follower groups on SNS, such as Telegram.
We aim to grow our user base mainly in two ways.
Firstly, we are in discussion with various leader-follower groups (so-called Whale groups) who are motivated to join the Carboneum platform for the benefits that it offers, such as efficient copy trading mechanisms. We believe that acquiring the leaders of such groups will grow our platform significantly, as they will bring their follow traders on to our platform.
Secondly, since we are a platform to facilitate social trading, the actual transactions would occur via our partner exchanges. We will be partnering with exchanges and, through such partnerships, we aim to convert such users into conducting social trading on our platform, as there are many traders who use centralized exchanges and yearn to learn from more experienced traders.
In addition, to this, we will be conducting various marketing initiatives and promotions to attract users to our platform.
ICO Alert: What is your strategy for creating a network effect and attract good crypto traders that can be followed by investors? What are some of the key features that will bring these traders to your platform instead of others?
Kortrakul: As mentioned above, we are already in discussion with various leader-follower groups (so-called Whale groups). Acquiring the leaders of such groups will grow our platform significantly, as they will bring their follow traders on to our platform, and such users will bring others onto the platform, triggering network effect. In addition, we will be conducting marketing and PR activities to increase the awareness of our platform.
There a number of key features that will bring traders on our platform. For instance, since the protocol will automate the copying of trades, this will greatly improve the user experience, as much as social trading for cryptocurrency is conducted in Telegram groups where leaders have to manually announce their strategies to their followers and followers have to copy the trades themselves.
Also, since the platform will have hundreds and thousands of followers who are looking for good expert traders to follow, this will work as a huge incentive for the leader traders to join our platform, show off their trading skills and gain more followers.
We also have StockRadars users who can use Carboneum and we have advisors as a influencers in Altcoin traders in the Thailand community, for pre-sale in Thailand alone we could raised up to $2 USD from our fan base.
ICO Alert: What are some of the key features that the platform will offer for investors that strictly want to follow leaders? Will users be able to set their own risk management parameters that differ from leaders they choose to follow? What is the “whale watcher” feature?
Kortrakul: A key feature of the platform is that it is going to be hugely customizable for followers, meaning that they can choose which leaders to follow depending on their risk preference and desired return.
Whale Watcher feature gives you insight into the actions of the large investment management of leader portfolio that manage millions of dollars worth of assets — the true “whales” of the investment world. By following these leaders, followers can get some good ideas on what to buy or sell.
ICO Alert: Price difference between exchanges and arbitrage is a popular strategy in crypto trading. What tools will your platform provide to help followers get exact or similar price when leaders execute trades on their exchanges? What kind of trade dispute procedures will you have in place?
Kortrakul: The platform will be connected with exchanges where the transactions are actually executed. Through such connection, the Carboneum will always show real-time data and the protocol will ensure that the followers’ trades are copied at the same price as the leaders’.
The leader will provide the access to their investment account comparable to giving an API key to third parties. The follower then signs the contract to start copy trading command of the leader.
The follower is required to transfer the Carboneum tokens to a multisignature wallet for paying the fee in the system. A multisignature wallet can be used in this particular use case of the social trading app where it does not want to have full access or full ownership of the wallet, and the application provider simply allows user to login with traditional username and password — not the private key. This digital wallet however requires users to transfer Carboneum tokens at a minimum reserve level in order to activate trading activities. Users who fail to meet minimum reserve will be prohibited from executing trade orders, let alone using the social trading feature. Further to the process, the order relay*** will automatically sign and onboard these contracts to grant the right to process future trading operations to Carboneum.
*** The Relay is a computer running our software to operate off-chain trade order execution via exchange API ***
Relay will keep tracking trading activities on digital assets exchanges a user is associated with, and executing the trade operation for the follower such as opening position, taking profit order and closing position to the follower account on their exchanges. Once trading order is executed and positive gain is realized, relay will send a request to the contract to deduct fee from a digital wallet of a follower.
ICO Alert: One of the value propositions for traders is the commission structure. What kind of commissions should traders and investors expect from using your platform?
Kortrakul: Many social trading platforms today charge followers, even before they make any profit. They often have to pay for joining these whale groups or are charged a high spread on the trades they make.
Carbonenum aims to solve this by aligning the financial interests of stakeholders. It is only when a follower makes a profit that they are charged a fee, which is paid to the leaders as a reward.
ICO Alert: Regulations on cryptocurrencies and ICOs are big news these days. Are you planning to be regulated by any specific entities? How does Carboneum plan on supporting traders from countries with strict regulations on crypto trading?
Kortrakul: The company is based in Singapore. Therefore we will ensure that we strictly follow all the rules related to our business in Singapore.
At the same time, since we will be connected with exchanges, we will ensure that we follow all of the same procedures that our exchange partners follow to we stay compliant, including performing KYC and AML checks, etc.
ICO Alert: As a non-Carboneum question, we like to ask for unique predictions for the ICO and cryptocurrency space in the future. Where do you see both in the next 3–5 years?
Kortrakul: For ICOs, It’s a great opportunity for the potential of the ICO capital raising model to “democratize” access to alternative investing and start-up funding with great application of blockchain to new business ideas. However, regulations in some countries are starting to make ICOs harder. We hope the government will develop more of an understanding in blockchain and cryptocurrency without fear. A great example is Japan, in which regulatory direction have added a much-needed certainty, which eventually help markets stabilize and encourage wider participation amongst investors. Regulations clarified requirements, increased certainty, and reduced risk. Global crypto markets reacted very positively, and Japanese exchanges carried a premium over foreign ones.
Source: ICO Alert