This is a new series in which I will introduce cryptocurrencies that I researched in an effort to make the right decisions on where to invest. We are starting out with one that could be a real disruptive force in the online payment industry. This is: UTRUST.
As a crypto enthusiast, it is no surprise that I am constantly looking for ways to increase the value of my portfolio. While I am looking mainly at the U.S. Dollar value of it, the primary goal of everybody should be to accumulate as much value against Bitcoin/Ethereum as possible. With an industry currently valued at $150bn and many analysts agreeing that the global market cap should be somewhere between $2 and $5 trillion, this makes sense.
Today I am introducing you to UTRUST. An existing and already funded company that is – in their own words – trying to become the PayPal of cryptocurrencies.
UTRUST aims at combining the positives of traditional payments with the positives of cryptocurrency payments while eliminating the negatives. While cryptocurrency payment providers already exist (e.g. BitPay and Stripe), they also have implications towards the buyer. Once a payment is done it becomes non-refundable even if the seller does not provide the advertised goods.
In their own words, UTRUST wants to establish themselves as the PayPal of cryptocurrencies, improving user experiences by offering buyer protection through an in-house escrow and mediating service, as well as advancing business reach for merchants by offering to accept all major cryptocurrencies as a form of payment. This has significant implications for merchants and buyers alike.
When consumers think of PayPal they are not only seeing a convenient payment platform. They also think about that if you order something physical you will be protected by PayPal. Ordered something that never arrived? Or whatever arrived isn't what you ordered? Likely not a problem if you paid through PayPal.
UTRUST aims to not only bring the very same benefits to cryptocurrency payments but indeed go one step further and extend this protection to digital goods. Something that PayPal refuses vehemently.
On the other side, you have merchants that need to account for very high payment fees while also not being protected from stolen credit cards or other fraudulent activities. Direct integration into credit card payment providers isn't any better and likely even more costly.
Here too, UTRUST aims at making everybody's life better. With a flat 1% fee and instant conversion to fiat through external exchanges, combined with the nature of having no risk of chargebacks or stolen payment information, it could be very appealing.
The supermajority of tokens will be distributed (85% in total between private and public investors). A total of 10% was pre-allocated to private investors while another 75% is to be sold in the presale and ICO.
UTRUST could be an interesting investment for several reasons. Consumers, merchants, and investors benefit for other reasons. I tried to categorize them by the benefited.
While going through the whitepaper I noticed a few points that I needed to get clarified. I joined their Slack and got prompt and precise answers by Nuno Correia (CEO at UTRUST).
Payments are immediately converted and held in escrow as fiat?
Nuno confirmed that this is the case. If a dispute and/or escalation be opened and settled in favor of the user, the refund will be made in fiat. However, UTRUST offers users at any time to convert fiat funds back into a crypto of their choice. Still, the possibility of a coin rising significantly while in escrow is a significant downside. Imagine paying $100 with PayPal and getting $80 back after 2 weeks of escrow.
What currencies will be supported?
The whitepaper only mentions USD, but Nuno confirmed EUR and GBP will also be supported. Their bank accounts will support SEPA transactions which are fast and cheap.
Do I own my private keys?
Nuno confirmed here that payments can be made through the UTRUST wallet, as well as from the outside with keys only you control.
Are there any fees involved with using the service?
Merchants pay a flat 1% fee while the service is free to use for users, with the exception of an escalated dispute that requires a mediator. If this is the case and the dispute is settled in favor of the buyer, a 2% fee is deducted from the refund before being returned.
What countries is UTRUST launched in?
UTRUST does not have border restrictions and can be used from everywhere.
What cryptocurrencies will be supported?
Nuno said they will "support at least 10 major cryptocurrencies" from the start.
The ICO is held in 8 phases. A private pre-sale (10%), followed by a public pre-sale (5%), followed by 7 rounds of public sales (at 10% each). A total of 1 billion tokens are in existence of which 75% are to be distributed in the public presale and ICO.
UTRUST will hold tokens worth 10% of the total sold to private and public investors. Those tokens will be distributed over 5 years at a rate of 20% per year. With a majority 51% going into engineering and development and an additional 21% into marketing and promotional (i.e. merchant incentives), the funding seems well distributed.
UTRUST makes a very good and well thought through project. They are ambitious and see the world in a visionary way. Nothing is perfect and it comes at a price of instant (market) conversion which may not always be favorable. Another downside is clearly the risk of cryptocurrencies rising while buyers are waiting for a dispute and/or escalation to be settled.
Nevertheless, I think this project could be worth investigating further if you believe that cryptocurrencies are here to stay, as projects like UTRUST are going the extra mile to make sure real life applications will arise.
This article was original published on https://notcreative.co/crypto-primers-utrust/.
