Crowd-founding Starting Time: 0 am at Nov 7, 2017
Crowd-founding Ending Time: 0 am at Dec 7, 2017
Basic Information about the Project:
Currently, decentralized exchange centers have been experiencing ongoing iteration, but most of them are of low liquidity, poor user experience and unattractive, and will be weeded out in the future. Leverj is devoted to the safe trade of financial derivatives in decentralized smart contracts, which focuses on derivatives trading and the establishment of an ecosystem that encrypts the world of currencies.
Leverj Rating Report
I. Market Analysis
Although the cryptocurrency industry has been booming, the market is still in its early stage and has many imperfections, including the security of cryptocurrencies. For example, large exchanges like MtGox and Bitfinex have experienced hack attack, causing a large amount of funds loss. In addition, the traditional financial stock market are trading in the country’s exchanges with the Commission’s control. The daily turnover of the Chinese stock market almost reaches 600 billion RMB, but it’s only a few billion dollars for the global cryptocurrency market. What’s more, there are at least 4000 exchanges now in the world, making it difficult for investors in small exchanges to clinch a deal. In general, although ailing liquidity is a pain point for the industry, every coin has two sides, the industry is in its initial stage and shows a larger space for future development.
Among the decentralized exchanges in the industry, Leverj has the advantage of providing a decentralized leveraged transaction that allows it to achieve high-speed trading and leverage trading at the same time. The project is based on a dual token mechanism, its basic token is LEV, which is supplied with a fixed amount and acts as the licence for the token to be traded on the platform, and its secondary token is FEE, which is used as the payment of the settlement.
The generation mechanism of FEE is that LEV-holders do not automatically generate FEE, in stead, LEV-holders lock their tokens inside the smart contract and generate FEE according to how much time it is locked, the longer the time is, the more tokens can be generated, and the number of times that FEE are produced is not limited.
The author’s personal point of view is that the double token has the following advantages:
1. The cryptocurrency fluctuations will be reduced. A lot of decentralized exchanges have been adopting one token mechanism, however, in the future long-term operation, if the number of token continues to decrease, or if the value is increased because of the reduction of tokens, those who invest in tokens for gaining value will choose to hold the tokens instead of trading. At that time, there will be fewer tokens circulating in the market, thus reducing the transactions in the exchange, which is a situation that the exchange is unwilling to see. Therefore, with dual tokens, the primary token acts as a symbol of stock equity in representing the future value of the project will be increasing. And the secondary token FEE acts as an exchange fee, avoiding volatility and reducing speculation in the primary currencies.
2. The secondary token will keep its price stable: When the price of FEE is high, it will be sold instead of being used to pay the handling fee. As more amount of FEE is being sold in the market, the price drops to the previous level, and as a result, the FEE for paying handling fee can be kept stable.
Project Pain Points:
Centralized exchanges have a high degree of risk, since your funds are stored on the platform, and it is unsure whether your funds have been used by the platform or not.
In centralized exchanges, the users’ identity will be unavoidably exposed, for data and information like the users’ funds and transaction history are kept in the centralized exchange, and it is simple and extremely tempting for the hackers to steal the assets of the centralized exchange, so the investor have to take the huge risk of user safety themselves. In addition, it is common for decentralized exchanges to embezzle the clients’ funds, so you may not be able to get the token without delay even when you need it urgently.
Through the decentralized characteristics of blockchain, Leverj makes sure that the users to control their own account funds, avoiding the reveal of identity and account.
In the early days of the development of the digital encryption industry, there exist problems in current centralized exchanges, like high risk of hack attack and low liquidity. However, Leverj can greatly reverse the original centralized industry and its ecosystem. Although Leverj claims itself as a decentralized leveraged exchange, there is nothing related to leverage structure in the framework. The author personally believes that if the platform aims to be a decentralized leveraged exchange, it should acts as an independent third party to trade in the chain. The profit of the investor’s means the loss of the platform, so the platform can only control the risk through the chain and make the manipulating more transparent. And the project has a relatively new point, that is, the dual tokens mechanism. In the future, ICORoot team will continue to track and report the progress of the project.
Scoring Parameters for the Market:
Overall Score: 100 points Effective Score: 93 points
II. Team Analysis
Bharath Rao (Founder and CEO): Technical product manager at GE, R & D engineer at Motorola, 10 years of experience in software engineering at Wall Street investment banks.
Nirmal Gupta (Founder and CFO): Full developer, more than 10 years of software sevelopment experience, previous software engineer in Cisco and numerous financial companies.
Babu SK (Operating Officer): Fintech expert, professional in corporate operation and strategy, rich experienced in operation and management.
Gerry Howatt (Marketer): Over 20 years experience as marketing director and media strategist.
Alexandra Ward (Community Manager): Encrypted currency trader, cryptocurrency forum moderator, trading community manager.
The CEO, chief technician and operators have been working at Leverj for more than a year, but there are too few introduction about leverage. The CEO had a 10-year software engineering development experience at an investment bank on Wall Street, so the technical architecture will not be high. And there are financial product expert, crypto derivatives veteran and founder of Whalepool in the team. Overall, the project did not have too much celebrities endorsement, so the team background is merely general. The future project landing can be expected, and ICORoot will continue tracking the aspects related to the exchange structure.
Scoring Parameters for the Market:
Overall Score: 100 points Effective Score: 62 point
III. Technology Analysis
Leverj includes on-chain asset custody and equity contracts, as well as off-chain centralized or decentralized order book and matching engine.
Isolate the Account:
In Leverj, the so-called asset hosted contract is actually unmanaged. Its purpose is to keep the user’s assets, while ensuring that only the user himself can access the funds. When the user deposits cryptocurrency to the contract, the hosted contract will allocate the corresponding amount of token to the sending address and records the amount that the user can withdraw.
Order Book and Matching Engine:
Order book and matching engine are centralized off-chain services. The users sign the order with the private key and send it to the exchange, and signing with the private key ensures that the account holder has the same account as the order sender. The updated order book will be pushed to all users off-chain. Once the order is matched, the order execution will be sent to the user, and the executed orders will be periodically synchronized to the blockchain. The execution of the order is done in the hosted contract, which verifies and updates the user balance.
The hosted contracts add up the transaction cost and sent it to the equity contract. Based on the amount and time of tokens held by the user, the equity contract regularly calculates the user’s allocated profit based on the equity formula, and the equity contract will produce new tokens on demand. The fee paid with ETH will be sent to the Leverj team and a portion of the cost will be allocated to the user (no specifics mentioned).
Current decentralized exchanges are not suitable for trading, and they do not support risk hedging. Leverj’s goal is to meet these real-world transaction needs in a decentralized system which achieves a distributed contract that executes on-chain and verifies off-chain. In the White Paper, Leverj fully considered various security issues that may be encountered during the execution of the contract, as well as illustrating the corresponding solutions and the deficiencies of Leverj itself.
Scoring Parameters for the Technology:
Overall Score: 100 points Effective Score: 62 points
IV. Funds Supervision Analysis
Scoring Parameters for Funds Supervision:
Total score: 100 points Effective score: 45 points
V. Profit Model Analysis
Most projects of the exchanges gain profit from the charge of handling fees. The project uses a dual tokens mechanism. The primary token is used for voucher and financing, and the secondary token FEE is used as paying handling fees. Because it is a leveraged transaction, Most of the profits are still from the position, instead of merely from handling fee.
Scoring Parameters for Profit Model:
Total Score: 100 points Effective Score: 70 points
Total Score： 100 points
Effective Score: 67.3
1. The score is rated referring to the rating rules, and acts as a reference before making investment decisions.
2. This rating is based on the information provided or officially announced by the rating object. The rating object is responsible for the legitimacy, authenticity, completeness and accuracy of the relevant information.
3. The analysis and conclusion of this report can only be used for relevant reference and decision-making, and this report does not act as any investment advice such as buying or selling. Therefore, ICORoot does not take any consequences of the investors’ loss caused by operating in light of this report.
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