This analysis was first released at the 8th of September, when WTC was at ~35,000 satoshi.
WTC is at 170,000 satoshi right now - I consider this heavily overvalued and would advise to stay away from it for now.
The name of this quite new cryptocurrency is just as much an acronym as the name of the inventor Charles Walton, who is considered the inventor of RFID technology (radio frequency identification). The acronym stands for "Wisdom alters label, trade, organization and network". The company was founded on the 5th anniversary of Charles Walton's death - in the introduction video, this the 11.03/30.2011 (it is hard to understand), but Charles Walton actually died at the age of 89 on 11.06.2011 . I suspect that a simple translation error from Chinese into English led to this minor mistake, as the translation of the whitepaper is a bit clumsy in some places.
Anyways, lets dive into the analysis:
1 Publicity
WaltonChain (abk. WTC) is operated by the Chinese-Korean company of the same name, which is headquartered in Hong Kong but operates from mainland China.
The team is confirmed in the white paper with both names and relevant CV data, key members have already been identified and confirmed in photos. The team is working full time on the project, it is not a side-project of an enthusiastic team of developers. In addition to the team itself, all sponsors, consultants and business angels are listed in detail. However, due to the fact that this is a Chinese-Korean project, the verification and assessment of relevance for the western observer is difficult, since this is only possible in the respective national language (Mandarin or Korean) and rarely in English. In this case, a neutral observer must either employ his own translators or trust the public translations on the relevant media (reddit / bitcointalk etc.). So far, we have confirmation on their backgrounds and no valid doubt left in their credibility, involvement and qualifications .
The background of the team consists not only of those members who are responsible for the technical implementation of the product but also of members who have business management focused degrees and dedicated experience in the retail sector.
According to Waltonchain's website, there are partnerships with 16 companies:
It is difficult to fully assess the relevance of all partners – mainly due to the language barrier and the lack of availability of further information from Waltoncoin (sales, number of employees, scope of the partnership, etc.). Some of these partners are big (e.g. Kaltendin is a clothing company with over 500 stores in china) and a close partnership is implied through the whitepaper , others are hard to do research on.
There is a confirmed Twitter account, which is linked to the official website of Waltonchain and is mainly aimed at Western investors. There are 3 other communication options (choice of Wechat, Weibo & QQ), which are more oriented towards investors in China or Korea and offer only limited value to the western investor, as information, announcements and discussions are mainly conducted in Chinese/Korean. If you are actually capable of reading and understanding Chinese however, this is a good platform to gain fast information. Other than that, there is a slack which I would however to advise to stay away from. Even tough it is moderated and in English, the niveau can be considered low and the effort to gain actual informations should not be too high .
Waltonchain also has an active media presence in China - including multiple articles on reputable platforms such as china.com (72 million visitors per month) and sina.com.cn (~580 million visitors per month). Western attention is more limited to cryptocurrency-related platforms such as bitcointalk.org, small blogs and a dedicated subforum on Reddit. There are no articles or references in foreign western media to gain relevant informations .
The Western cryptocurrency community is well aware of Waltoncoin so far, but there are no detailed, freely available articles outside of china yet. So far, awareness has mostly been increased by word of mouth.
Publicity – grade: 7.5/10 (7 for good public relations activity and good network of partners in general, +0.5 as this is rare for Chinese teams to do for investors in western countries)
2 Activity
The developers are active, an AMA on the platform Reddit is in the planning stage and at the time of writing the analysis, questions will be collected for this public round of questions to the Western audience . During the Chinese government's announcement of the ICO ban, the team also kept Western investors informed with optimistic but accurate information on the current situation .
Generally speaking, the coin also experiences a mixture of excessive enthusiasm and excessive scepticism. It is not advisable to use this medium before deciding on the investment, as the danger of falling for FOMO is quite high right now.
The coin is currently traded on only two currency trading platforms: Binance and Etherdelta. As the amount of WTC traded on etherdelta is negligible and the main trading is focusing on binance, the analysis will focus on binance. There, the coin had a high 2 days after his opening, in which the price rose to over 600,000 satoshi per WTC (~$3 at the time of writing the analysis). After this, it corrected again as a result of the implementation of the ICO ban of the Chinese government on September 4,2017 to about a third of the ATH. This strong increase and subsequent sharp drop in price to a lower level could imply a pump & dump. But this is unlikely due to the low age of the coin and the lack of an accumulation phase before. Waltonchain is the most often traded currency on this platform and accounts for about 21.4% (12.6 million out of 59 million USD) of the total trading volume on it. This means that Waltonchain surpassed the platforms own cryptocurrencies Binance Coin (11,061,000 USD, 17.5%) and the overall second largest Cryptocurrency Ethereum (7,584,000 USD, 12.85%), which both have a market capitalization several times higher than Waltoncoin (Binance Coin: ~3 times higher, Ethereum ~900 times higher).
Activity - grade: 7.5/10 (7 as a prominent team is present which shows dedication to their work, +0.5 the coin is being traded at high volume above other established currencies at a small exchange)
3 Technology
Waltonchain aims to combine block chain technology with existing RFID chip technology, an established technology which is in everyday use for several decades now. RFID chips are transponders based chips various sizes and shapes, which can be recognized by radio waves from a reader with a range of 0.5m to 10m, depending on the operating frequency.
The whitepaper mentions a multitude of potential uses, some of which have already found their way into industry years ago. Libraries and some major fashion houses such as C&A are already using these RFID chips as a means of batch processing. While this is indeed an advantage and is listed in the white paper for e.g. speeding up the checkout process in retail, it is nothing new. The same applies to theft protection, verification of the authenticity of medicines and the "Paypass" system already used by Mastercard, which also works with RFID chips .
However, a unique feature in connection with block chain technology is the impossibility of falsifying an RFID signal. Even well-done counterfeits, which would be considered objectively as an original product, can thus be identified without a doubt as a counterfeit by a simple scan of the RFID signal.
In the heart of the Walton ecosystem is the parent chain, the uppermost blockchain in the form of Waltonchain. Subchains can be built around it, using the token Waltoncoin as a way for payment and transactions. These subchains can be adapted for their own application area and can also choose their own consensus method like PoS, PoW. In the case of Waltonchain, a modified method of PoS called PoST (Proof of Stake and Trust), including a “reputation evaluation system” . This could add a notable advantage to their product over competitors, as more credible transactions lead to more trust from the customer.
In contrast to focusing on a single area of usage, such as the retail purchasing process, Waltonchain cites applications along the entire value chain for the automatic and counterfeit-proof recording and transmitting information, beginning from the manufacturing process to data collection in consumer research after the purchase process took place.
Waltonchain is currently unrivalled in the combination of RFID chip technology and block chain technology, but individual companies such as Lemmi Fashion, the children's fashion manufacturer, are already using RFID technology within their production chain. Key for Waltonchain is to implement the blockchain technology in a matter that the competitors in the RFID industry need to either adapt to a similar system (like creating an ecosystem along the value chain without using the blockchain) or create a blockchain similar to waltonchain.
However, Waltonchain has to prove that the use of its product offers an effective added value for companies. If the use of already existing RFID chips in closed ecosystems within companies remains much cheaper than Waltonchain or if the cost of implementation is too high in comparison to the expected profits, it will be impossible for Waltonchain to bring the product to market. But as the team does not only consist of technicians, but also of business economists with experience in retail, I think the team will already be well aware of this fact.
Another issue in this respect is the fact that the market for RFID-chips is quite big. The whole market for RFID-chips is considered 11.2 billion USD in the year of 2017 and is expected to reach 14.9 billion in 2022 This however includes the market for readers, tags, software, services etc., so it is not like that if Waltonchain manages to get 2% of this revenue that their revenue automatically will be above 200 million USD. On the other hand, is the expected groth in the market within the industries Waltonchain want to target.
Technology - Grade: 6.5/10 (6 since RFID technology already exists and the blockchain has to improve it significant before it can be used as an advantage over the traditional use of RFID chips, +0.5 because the industry they target will grow considerably within the next few years)
4 History
There is an english roadmap and also a english whitepaper. There are no known problems in development so far, no discrepancies between the devs, dissolved partnerships or significant irregularities in the price.
So far, the targets on the roadmap have been met - but it is not possible to verify how old the roadmap is. Due to the fact that a letter of intent with Soonbox Logistics was due to be signed in June 2017, it can be assumed that the roadmap was written at least after this date. It is therefore not particularly meaningful that all the points on the roadmap have been reached so far.
History - grade: 5.5/10 (5 due to – so far – missing history; +0.5 because there are no problems so far and the roadmap does not raise any significant problems or questions)
5 Future
The team divides the realization of the project into 4 phases:
5.1 Phase 1
In this phase of the project, Waltonchain intends to develop an RFID chip with block-chain usage and to test this chip in pilot projects with the partners Tries, SMEN and Kaltendin. In addition to the integration of the chip into the fashion lines, their goal is to integrate the customer's intellectual property protection function and to solve "problems of the traditional clothing industry, logistics, shops and the aftermarket". At this point, the whitepaper is very general about which problems they would like to solve. Similarly, reading the passage "consolidating Waltoncoin's base platform" will not enlighten the user of actual actions during this time. The application scenarios will be used as a "golden demonstration/template" for the rapid dissemination of Waltonchain applications – also quite vague. The explicit aim of this phase is to achieve a broad publicity campaign and acquiring a broad customer base.
Naming the partners in this phase is very positive, because it already indicates specific plans and lays the foundation to build up a customer base already in the first phase of the project. This is good, as the liquidity of the project is not so much dependent on credits, price development of the coin etc. during the transition to the next phase. Negative is the generality with which the Devs in this phase talk about solving problems without giving actual examples of these problems or how Waltonchain will solve them.
5.2 Phase 2
In this phase, the RFID chip has already gone into mass production and is ready for use in the retail and logistics sector. The payment, transfer and reward system via block chain should already be implemented in this phase. Two sectors in particular will be targeted: retail and logistics.
Within retail, the customer should be already able to use this system in the course of the payment process, product evaluation, authenticity verification and general after-sales-service. The merchant is provided with information that includes market trends, sales processes and after-sales processes.
In logistics, information is to be collected for the entire goods route. Waltonchain wants to create a counterfeit-proof, reliable and accessible information channel for all parties involved, which should also prevent "systematic errors". Waltonchain remains unclear as to what errors are meant by this - but it is possible that they meant computer errors and data transmission errors as well as the detection of fraudulent conduct.
5.3 Phase 3
In this phase, the production industry is to be involved and thus individualized ordering processes are to be made possible.
Apart from that, the remarks in Phase 3 are merely a repetition of the previous advantages of using blockchain technology in conjunction with RFID technology, but more in relation to manufacturing companies: transparency, security against counterfeiting and quality assurance.
5.4 Phase 4
In this phase, Waltoncoin intends to develop additional RFID chips for collecting information. Examples include biometric chips, chips with variable operating frequency and "different sensor chips". The aim is to create secure interfaces between physical possessions, humans and animals to create a secure and reliable means of digitization and networking, to "make people's lives easier". The aim is to carry this digitization into every sphere of life.
Phase 4 is therefore the most ambitious goal and would automatically open up the greatest business potential. It is unclear to which degree reaching this goal will influence the dissemination of the RFID-technology, but it leaves the impression that the vision is overtaking the reality when we look at the timeframe of their plans – even considering that the RFID-technology will grow to a large extend in the next few years, the amount of implementation of RFID-technology in said areas needed to fulfill this vision is to be expected way higher. It is a possibility that this will happen, but I think that this vision is not realizable by the end of their roadmap and is better to be put on the next one.
Reaching even phase 2 however should have a tremendous effect on the market capitalization and therefore on the price of WTC. So the criticism of the last phase should not be considered a major point when you decide to invest into Waltonchain or not.
Rumors that Waltonchain should be listed on the Bittrex trading platform were caused by the fact that the platform's Twitter account followed Waltonchain's account. However, Bittrex denied a connection between the connection of both Twitter accounts and a subsequent inclusion of Waltonchain on the platform . Together with the fact that Bittrex has not included any other cryptocurrencies for the last month, it is assumed that Bittrex has paused another expansion for now and that it is not expected to take up WTC (or any other coin) soon anyways.
Future - grade: 6/10 (6 base score as the 4 phases described in the white paper cannot be found exactly on the roadmap)
6 Grades:
Publicity - Grade: 7.5/10 (7 for good public relations activity; +0.5 as this is rare for Chinese teams to do for investors in western countries)
Activity - grade: 7.5/10 (7 as a prominent team is present which shows dedication to their work; +0.5 the coin is being traded at high volume above other established currencies at a small exchange)
Technology - Grade: 6.5/10 (6 since RFID technology already exists and the blockchain must improve it significant, before it can be used as an advantage over the traditional use of RFID chips; +0.5 because the industry they target will grow considerably within the next few years)
History - Note: 5.5/10 (5 due to – so far – missing history; +0.5 because there are no problems so far and the roadmap does not raise any significant problems or questions)
Future - Note: 6/10 (6 base score as the 4 phases described in the white paper cannot be found exactly on the roadmap)
Overall score: 6.6 / 10
7 Conclusion:
The roadmap and the whitepaper leave some questions unanswered and seem somewhat "too ambitious" in some cases. Nevertheless, the market capitalization is very low for this project, considering the team's high degree of transparency, the numerous partnerships, big names on the team and the big growth of the industry. Market capitalization is currently circulating at around 33 million USD with 25 million WTC circulating currently. Maximum circulation will be around 100 million WTC, which will be distributed like this :
However, the recent ban on ICOs in China forced WTC to offer a voluntary return policy to all who participated on the ICO. Even though the ratio between WTC and ETH is so bad that it is unlikely that a huge amount of investors do that, it is still unclear what will happen to the WTC returned to Waltonchain. There are rumors that these coins will be burned (meaning that they will never enter circulation), cutting down the total amount of WTC and therefore increasing the value of the circulating WTC. The extent of this action however is only open to speculation, as no official statement is available right now.
Also should be noted that the WTC of angel investors are locked for 3-12 months, meaning that the price could take a hit, if due to unpredictable events a angel investor loses his faith with the project and decides to dump his stash. In this case however the catastrophe would be more the angel investor leaving the project and cutting his ties with the team than the additional coins in circulation, so this is not a point to break into sweat over this.
Therefore, and since Waltonchain is only traded on two small exchanges, it can be assumed that WTC is currently traded way below its value. However, due to the uncertainties in the Chinese cryptocurrency market and the uncertainties in the further admission of WTC to other trading platforms, it is unclear when and to what extent the value of WTC will rise.
This analysis is from the 8th of September, when WTC was at ~35,000 satoshi. I published it at my Blog and on twitter:
https://randallmaller.wordpress.com/
https://twitter.com/Randall_Maller/status/906244349809315842
- Randall_Maller
It is at 170,000 satoshi right now. I consider this heavily overvalued!
I produce such analysis on a regular level.
