Barter exchange on Cardano

Tokenizing real illiquid assets of companies, then putting them on the barter exchange, will create liquidity for those illiquid assets.

Mr. Nguyen Thanh Binh (team leader): Ph.D in Economics, 22 years working experience in banking and finance.

I tried to set up a barter exchange business in Hanoi (Vietnam) in 2012 - 2013. But this barter business was not run on blockchain at that time.

[IMPACT]

[Note:

1. To get an overview about barter industry in the world, please read file attached below "AN INTRODUCTION ABOUT IRTA AND BARTER INDUSTRY";

2. To get an overview about a barter business on blockchain, please see case study of Barter Smartplace attached "Barter Smartplace_Whitepaper_Dmitry Zhukov2019"  ].

Barter exchange on blockchain (as Cardano) is an essential bridge to bring real assets (as commodities, real estates, financial assets) onto blockchain world.

According to Shermin Voshmgir (November 2020, Token Economy): “Tokenizing economic activities, from real assets to digital assets and all types of access rights, could impact the role of central bank money as a geopraphical monopolist providing a medium of exchange (…) Such tokenization of the real economy could gradually lead to the merging of the money system, with the financial system and the real economy.”

According to Fokast.News report (December 2020, The Unstoppable rise of Digital Assets), the key trends in the digital asset market in the coming years are (i) tokenization of widely traded traditional assets, such as stocks and bonds; and (ii) tokenization of previously untraded or under-traded (illiquid) assets, such as real estate and fine art.

Latoken (www.latoken.io), in its whitepaper 2017 (attached), predicted that the asset tokens may cover upto 80 per cent of the total digital asset market cap in 2025.

The main components of the barter exchange project consist of following ones:

-  Barter exchange platform

- Wallet app

- Tokenization service

Barter Business Model:

Barter means using what we have to get what we want (or need), through directly trading or a third party.

- Benefits of barter business:

• Saving cash during lacking liquidity circumstances;

• Improving cash flows; using cash for more favor and urgent activities and expenses;

• Optimizing inventories and surplus/temporary idle production capacities;

- Business principle:

Mobilizing idle commodities (inventories); then supplying to the enterprises in demand.

Barter exchange on blockchain (as Cardano) is an essential bridge to bring real assets (as commodities, real estates, financial assets) onto blockchain world.

- From the side of real asset holders: Barter exchange helps bring liquidity to the real asset holders. By tokenizing their real assets and putting them on blockchain, the real asset holders can apppoach crypto currencies of the crypto holders;

- From the side of crypto holders: By joining the Barter exchange, they can spend their crypto assets and get a chance to be owner of the real assets;

Challenges or Risks I foresee:

1. Economic and Market risk:

Is it viable to get market players (companies and crypto holders) involving in this asset token platform?

To solve this risks, it is essential to recruit enough number of members of barter exchange during test net period (the first 6 months).

It is important to have enough fund to support for the first 100 members in this period.

It is also important to cooperate with strategic business partners, as other commodity exchanges, custody agency, and asset pricing agency;

2. Legal and regulatory risks:

Legal risk:

Yes. There is still lacking of legal framework to run Defi lending and crypto exchange in Vietnam. This model should get sandbox’s permission of the local government. This regulation will exist in 2022.

Tokenizing real estate assets also encounters with legal and regulatory risks. The legal framework for this is not clear yet.

To solve these risks, we get legal consultant service to make solutions.

3. Financial risk:

It is a risk for lacking of initial capital investment. In the first period, it is essential to have enough capital to set up barter exchange and recruit a minimum number of business members (at least 100 companies).

Therefore, getting fund from Catalyst Project Fund 8 is a key condition for the success of the Project.

[FEASIBILITY]

A draft version of business plan is attached here with for your reference.

In this part, I deliver some information about roadmap and main deliverable outputs of the project:

Roadmap and deliverables:

- April – June 2022: set up development team and making MVP

(03 DeFi developers, 01 legal expert, 01 banking and finance expert)

Writing technical document and making MVP;

• Basic designing of MVP: including three key components (i) wallet application; (ii) barter exchange; and (iii) decentralized lending.

Fund: raising fund from Catalyst Fund 8 (USD 160,000).

- July – December 2022: running test-net (building up a barter exchange with 100 corporate members)

KPIs:

• Barter network: 100 corporate members

• Asset tokenization value: VND 100 billion (USD 4.5 million)

• Trading volume: VND 50 billion (USD 2.3 million)

• Lending revenue: VND 23 billion (USD 1 million)

• Crypto holder participants: 10,000 persons

Fund: raising fund from public, USD 5 million

- Jan – June 2023: running main net (expanding member number of the barter exchange up to 500 corporate members; connecting with the global barter network)

KPIs:

• Barter network: 500 corporate members

• Asset tokenization value: VND 500 billion (USD 22 million)

• Trading volume: VND 250 billion (USD 11 million)

• Lending revenue: VND 100 billion (USD 4.5 million)

• Crypto holder participants: 50,000 persons

- July– December 2023: increasing member number of barter exchange up to 1000; connecting the platform with the global crypto exchanges.

• Barter network: 1000 corporate members

• Asset tokenization value: VND 1000 billion (USD 44 million)

• Trading volume: VND 500 billion (USD 22 million)

• Lending revenue: VND 200 billion (USD 9 million)

• Crypto holder participants: 100,000 persons

- Catalyst project-Fund 8: From April - December 2022

• Set up a development team (05 members):

(5 member x USD4000 x 3 months )

Fund to make a MVP (website and mobile app) of the barter exchange on Cardano platform

(from April – June 2022): USD 60,000

• Launching test-net: running a pilot barter exchange with 100 members:

(from July – December 2022): USD 100,000

Budget request: USD 160,000

Currently, we have got 3 team members as following. We are seeking for two team members, one is a legal expert, another is blockchain and DeFi IT expert.

1. Nguyen Thanh Binh (Mr.) (team leader): Ph.D in Economics, 22 years working experience in banking and finance.

2. Nguyen Duc Nam (Mr.): Major in servers, server app such as Cardano-node; Cardano-wallet; system architecture; 13 years of experience in building and developing websites and mobile apps; founder of DIASNFT.IO project (Vietnam).

3. Hoang Cao Cuong (Mr.): Major in Smart Contract; 13 years of experience in building and developing websites and mobile apps; founder of DIASNFT.IO project (Vietnam).

[AUDITABILITY]

(See Roadmap and KPI measurement mentioned above).

(See Roadmap and KPI measurement mentioned above).

Roadmap and deliverables:

- April – June 2022: set up development team and making MVP

(03 DeFi developers, 01 legal expert, 01 banking and finance expert)

Writing technical document and making MVP;

Basic designing of MVP: including three key components (i) wallet application; (ii) barter exchange; and (iii) decentralized lending.

Fund: raising fund from Catalyst Fund 8 (USD 160,000).

- July – December 2022: running test-net (building up a barter exchange with 100 corporate members)

KPIs:

• Barter network: 100 corporate members

• Asset tokenization value: VND 100 billion (USD 4.5 million)

• Trading volume: VND 50 billion (USD 2.3 million)

• Lending revenue: VND 23 billion (USD 1 million)

• Crypto holder participants: 10,000 persons

Fund: raising fund from public, USD 5 million

- Jan – June 2023: running main net (expanding member number of the barter exchange up to 500 corporate members; connecting with the global barter network)

KPIs:

• Barter network: 500 corporate members

• Asset tokenization value: VND 500 billion (USD 22 million)

• Trading volume: VND 250 billion (USD 11 million)

• Lending revenue: VND 100 billion (USD 4.5 million)

• Crypto holder participants: 50,000 persons

- July– December 2023: increasing member number of barter exchange up to 1000; connecting the platform with the global crypto exchanges.

• Barter network: 1000 corporate members

• Asset tokenization value: VND 1000 billion (USD 44 million)

• Trading volume: VND 500 billion (USD 22 million)

• Lending revenue: VND 200 billion (USD 9 million)

• Crypto holder participants: 100,000 persons

This proposal is a new one, It is not a continuation of a previously funded project in Catalyst.

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