VNX - Licensed European non-usd stablecoins issuer on Cardano

[GENERAL] Name and surname of main applicant

[GENERAL] Are you delivering this project as an individual or as an entity (whether formally incorporated or not)

[GENERAL] Co-proposers and additional applicants

Nikolay Khort (Lead)

Alexander Tkachenko

Mikhail Epishkin

[GENERAL] Please specify how many months you expect your project to last (from 2-12 months)

[GENERAL] Please indicate if your proposal has been auto-translated into English from another language

[GENERAL] Summarize your solution to the problem (200-character limit including spaces)

With regulated EUR/CHF stablecoins we solve the problem of non-usd stablecoins lack, connection to TradiFi in Europe, offering sophisticated crypto-based products and bringing TrafiFi liquidity

[GENERAL] Does your project have any dependencies on other organizations, technical or otherwise?

[GENERAL] If YES, please describe what the dependency is and why you believe it is essential for your project’s delivery. If NO, please write “No dependencies.”

No dependencies

[GENERAL] Will your project’s output/s be fully open source?

[GENERAL] Please provide here more information on the open source status of your project outputs

Due to regulatory requirements and business operating in commercial landscape we don't tend to disclose the developments that we make to the public and our competitors

[SOLUTION] Please describe your proposed solution

VNX is a stablecoins generating platform, licensed by the Liechtenstein Financial Market Authority (FMA) and recently received an registration of CSSF in Luxembourg, thus, becoming one of the few, if not the only player on EU market, licensed in two jurisdictions working with both European currencies - CHF and EUR. In terms of regulated CHF we tend to be the unique player who can actually generate licensed CHF.

Our current products line includes VNX Euro (VEUR), VNX Swiss Franc (VCHF) and VNX Gold (VNXAU). All tokens are fully backed and fully reserved, reserves are stored on third-party custody accounts in Swiss banks, gold bars are stored in a custody in third-party vault in Liechtenstein. Regular independent audit-of-reserves reports can be found on vnx.li website.

We are multichain, currently supporting Avalanche, Ethereum, Polygon, Q, Solana, Tezos, Stellar. Now we would like to extend our presence and launch our fiat tokens on Cardano.

As per our knowledge, there are certain limitations of Cardano blockchain for issuers to be able to block tokens in the user’s wallet. However, as a licensed generator, we have certain requirements from the regulator, that would enforce us to perform such actions in certain cases, so significant part of this project would be to search for technical and legal ways to match the Cardano approach with the legal requirements and open the path for VNX licensed stablecoins to Cardano network.

Recognizing the complexity of launching stablecoins and the need for a solid foundation, we have adopted a multi-step approach. This approach allows us to ensure that each phase of the project is thoroughly researched, developed, and tested before moving on to the next.

1. Research and Development (R&D): The first phase, which is the subject of the current application, involves detailed R&D. This phase will focus on exploring technical and legal ways to match the Cardano approach with the legal requirements and open the path for VNX licensed stablecoins to Cardano network.
2. Development and Testing: Building on the findings from the R&D phase, the next step will involve the development of a Minimum Viable Product (MVP) and rigorous testing. This phase will be subject to a separate Development and Testing grant in a future Catalyst Funding Round.
3. Commercial Launch: The final stage will be the commercial launch of our stablecoins on the Cardano network, subject to a Product category grant in a future Catalyst Funding Round.

We have a proven experience of developing on different blockchains and collaborate closely with blockchain teams, ecosystems and community, so we’d be happy to work with Cardano community and apps to bring value of our products to Cardano users and developers.

As FX and real-world transactions tend to grow in the crypto space, we will bring more real-world fiat transactions onto the Cardano blockchain. As a non-usd stablecoins issuer we will offer diversification for Cardano users looking to hedge against different fiat currencies.

We have a proven track record in developing markets within the DeFi space, creating pools with volatile and stable assets and we have experience in stimulating markets, attracting TVL, and fostering organic trading volumes, so we will be happy to contribute to the growth of the DeFi ecosystem on Cardano.

As cross-border payments, crypto payments and traditional merchants are joining crypto space, we focus on collaborations with traditional financial institutions and real-world use cases (e.g. VCHF was recently approved for capital contribution when establishing a legal entity in Liechtenstein, we’re currently listing our tokens in a large Swiss bank in collaboration with one of our partner-blockchains, this will be announced as soon as it goes live in the nearest days) and thus we believe we will help bridge the gap between traditional financial systems and DeFi on the Cardano blockchain.

Essentially, our goal is to bring a set of fundamental instruments for Cardano users to help them build a wider variety of services and dramatically increase the value, that Cardano users will benefit from Cardano blockchain and Cardano ecosystem.

[IMPACT] Please define the positive impact your project will have on the wider Cardano community

We bring regulated non-USD stablecoins (EUR and CHF) that are currently lacking in the Cardano ecosystem.

We integrate our tokens in Cardano DeFi ecosystem development and integrate our stablecoins in VNX and various payment platforms (with options offered by VNX platform and solutions provided by other market players).

The adoption of MICA has significantly boosted institutional adoption in Europe. VNX is about to launch big use cases with traditional finance (We’re currently in the process of listing our tokens in a large Swiss bank in collaboration with one of our partner-blockchains, this will be announced as soon as it goes live in the nearest weeks) which will become a large liquidity source and open the way to collaboration with other financial institutions in Europe.

Our impact on the Cardano Ecosystem will be attraction of institutional and private client’s liquidity from TradiFi together with well-established crypto-market players, such as Cumberland and BitStamp, and is rooted in its unique product features, regulatory advantages, and strategic positioning to address the evolving needs of both DeFi and traditional finance markets.

We are able bring a developed liquidity in our stablecoins (pools with volatile assets, lending/borrowing, collateral for minting and CBDC).

We will bring TradiFi and traditional use cases, liquidity (we’re actively working with various LP providers and Marketmakers (e.g. Cumberland, Keyrock, B2C2), and launch initiatives to boost presence and demand for our products, stimulate our pools and make a deeper liquidity).

We will develop forex markets on Cardano by providing two quality currencies.

Besides that, our backend platform allows us to be an additional/alternative on-ramp/off-ramp solution for Cardano users and apps.

[CAPABILITY & FEASIBILITY] What is your capability to deliver your project with high levels of trust and accountability? How do you intend to validate if your approach is feasible?

We have a proven track record with several blockchains that we’re already live on, we have always met the deadlines set in grant agreements with all of them, as well as we’ve proven our capacity beyond IT development with further business development and close collaboration to bring more value, arrange activities and work actively with ecosystem and community in all cases mentioned above.

[PROJECT MILESTONES] What are the key milestones you need to achieve in order to complete your project successfully?

Technical requirements and design:

Requirements and Specifications Collection

Study different token types on Cardano

Explore Cardano integration with the platform requirements

Gather user requirements and create functional requirements specifications

Design the module architecture and system components

Validate the business logic requirements

Deliverable: Functional requirements specifications, system design and technical architecture

Timeline: 3 months

Budget: ₳60k

Legal and technical research to match regulatory requirements with Cardano blockchain specifics:

Research the principles, legal and technical limitations of Cardano network to block tokens on users wallets

Identify potential ways to design smart contracts in compliance with regulatory requirements applicable to VNX

Gain legal confirmation of applicability of potential solutions

Decide on the solution that will be eventually developed and integrated

Deliverable: Legal opinion and framework (technical and legal) to be able  to launch VNX stablecoins smart contracts on Cardano

Timeline: 2 months

Budget: ₳10k

Business-wise research and design:

Explore Cardano ecosystem

Identify potentially most suitable apps and services to go live at after launch on Cardano

Establish connections with apps and confirm validity of use cases

Arrange a set of preliminary soft commitments with 2-3 dApps

Develop liquidity map and launch plan

Deliverable: Established connections with Cardano dApps, Liquidity map

Timeline: 3 months

Budget: ₳30k

[RESOURCES] Who is in the project team and what are their roles?

We have a fully packed team of BD, IT and marketing, that have proven their competence and skills already.

The core team members can be found on our web-site: https://vnx.li/team/  

Total team is 18 FTE, over half of them are IT team.

Applicants and core IT team members are:

Alexander Tkachenko, CEO

Founder of Luxembourg VC fund 2be.lu. Co-chair of VC club at Luxembourg’s PE/VC association and Executive Council member at Digital Banking and Fintech Cluster in Luxembourg Banking Association. Serial entrepreneur, business angel. MBA from London Business School and Columbia University.

https://www.linkedin.com/in/alexander-tkachenko-2117434/

Mikhail Epishkin, head of BD

A decade of experience as Chief Sales Officer of Private Banking at Eastern European major banks, including six years of experience in entrepreneurship.

https://www.linkedin.com/in/mikhail-epishkin-15a43b2a/

Nikolay Khort, operations manager

Entrepreneur with more than a decade of experience, background in venture investments, project management, corporate finance and audit. Masters degrees in engineering and accounting.

https://linkedin.com/in/nikolay-khort-acca-28425ab2

Eugene Gavrilov, CTO

Eugene is an accomplished technology leader with over two decades of experience in the IT industry. He is the Chief Technology Officer (CTO) of VNX, a blockchain-based company that aims to democratize access to private markets through asset tokenization and has been working with different blockchains since 2019.

Prior to his role at VNX, Eugene held several leadership technology roles at some of the world's leading financial institutions, including the Moscow Stock Exchange, Sberbank CIB, and Deutsche Bank. His experience in these roles provided him with a deep understanding of the IT, finance and investment industries, in particular IT architecture of exchanges and investment banks, as well as the technical expertise necessary to build innovative and scalable solutions.

Eugene holds a degree from the prestigious Moscow Institute of Physics and Technology, and an MBA from the Higher School of Economics. His education and experience have provided him with a unique perspective on the intersection of finance and technology, and he is committed to leveraging the power of blockchain technology to transform the industry.

As the CTO of VNX, Eugene is responsible for driving the technical strategy of the company and development of secure and scalable IT solutions to suit the needs of the company. His leadership and expertise have been instrumental in the success of VNX.

https://www.linkedin.com/in/eugenegavrilov/

Viktoria Zasorina, PM

Viktoria has more than 2 decades experience in IT project/product management with core expertise in the finance industry. Her key areas are commodities, securities, and derivatives trading, risk management, and front-to-back processing.

Viktoria holds a degree in Computer Science from Moscow State University. She also completed the Sberbank 2020 Program in partnership with INSEAD Business School.

https://www.linkedin.com/in/victoria-zasorina-2761ba26/

Wazen Shbair - Blockchain Architect

Wazen is a Senior Blockchain Architect at VNX. Armed with a Ph.D. in Computer Science from the University of Lorraine, France, Wazen brings a wealth of expertise in blockchain technology.

Previously, Wazen served as a Research Associate at SnT, focusing on DeFi and Stellar blockchain technologies. Before that, Wazen held positions as a Research Engineer at CNRS and as a Lecturer at the Islamic University in Gaza.

With a solid background in blockchain architecture and a talent for bridging academia and industry, Wazen plays a pivotal role in driving innovation and excellence in the digital asset industry.

https://www.linkedin.com/in/wazenshbair/

https://github.com/wshbair

[BUDGET & COSTS] Please provide a cost breakdown of the proposed work and resources

Technical requirements and design (₳60k total):

Requirements and Specifications Collection (₳15k)

Study different token types on Cardano (₳10k)

Explore Cardano integration with the platform requirements (₳5k)

Gather user requirements and create functional requirements specifications (₳10k)

Design the module architecture and system components (₳10k)

Validate the business logic requirements (₳10k)

Legal and technical research to match regulatory requirements with Cardano blockchain specifics (₳10k total):

Gain legal opinion of applicability of potential solutions (₳10k)

Business-wise research and design (₳30k total):

Explore Cardano ecosystem (₳10k)

Identify potentially most suitable apps and services to go live at after launch on Cardano

Establish connections with apps and confirm validity of use cases (₳5k)

Arrange a set of preliminary soft commitments with 2-3 dApps

Develop liquidity map and launch plan (₳15k)

[VALUE FOR MONEY] How does the cost of the project represent value for money for the Cardano ecosystem?

The project represents excellent value for the Cardano ecosystem by:

• Offering a currency diversification options for stablecoins users and holders,
• Offering the lowest-inflation-currency (CHF) regulated stablecoins as a means of value saving
• Giving local currencies to European users, thus, saving their costs avoiding unnecessary FX in many cases
• Diversification for Cardano users looking to hedge against different fiat currencies.
• Bringing more real-world fiat transactions onto the Cardano blockchain
• Bringing collaborations with traditional financial institutions and real-world use cases
• Bridge the gap between traditional financial systems and DeFi

This investment will contribute to Cardano's long-term growth and leadership in the growing markets of non-usd stablecoins, FX, payments, money transfers, merchants apps and many others.