of its basic functionality as part of the labour market.
- The concept of hedging increasing the cost of manpower which can be very useful for businesses.
- The project founders have provided enough of a detailed plan for using borrowed funds and the development of their project.
- Strong marketing strategy will allow the project to quickly gain a critical mass of Chronobank’s infrastructure userbase.
- Multi-blockchain implementation. If a new blockchain protocol emerges and dominates the market in the future, ChronoBank will create tokens and decentralized applications on this platform.
- Elaborated technical model, including interaction of system components. There is a detailed explanation of the interaction of the system components, as well as specifications for tokens, contracts, dapps.
- At the moment, the idea of pinning the value of LHT to an average wage cost within a particular region is not clear. It’s also not clear whether the liquidity fund would be enough so that the market maker can support possible causes of force majeure. At the moment, there is no universally accepted cryptocurrency that could be used in large quantities due to certain fundamental cryptocurrency factors.
- The Labor Hire market in Australia, at the moment, is in stable condition without any sharply increasing dynamics. It’s worth noting that the current size of the market is large enough, but this does not give an absolute guarantee that the company, even after a successful implementation of their system, will continue to grow as a major innovative player in the labour market.
- In the second phase of the project, the company is very likely to face a large number of legal issues for many of which there are currently no solutions.
- The payment of dividends on Ethereum blockchain will take place in manual mode, and its implementation through smart contract is postponed. Dividends for TIME Tokens owners from other blockchains will take place only in manual mode.
- Some of the mechanisms of the platform work related to the second phase are not fully explained. For example, voting amongst tokens TIME owners.
Our evaluation for Chronobank is “Stable”. If the company will do the following, we may assign a higher rating for the project:
- The project will confirm its ability to keep a stable rate of LHT tied to the average wage cost in the region it’s used in.
- The matters regarding the legal justification of the project will be more specific.
- At the moment only the co-founder of the project - Edway Group acts as a LOC. As the number of participants of the platform grows, it will be able to confirm its relevance to the market which will have a positive impact on the rating.
- It’s necessary to make sure that a number of technical aspects of the platform will be implemented properly: ex. voting amongst TIME tokens holders and the dividend payment process.
Update on Chronobank’s Investment Rating - 12/20/2016
ICORating decided to raise Chronobank’s investment rating from stable to stable + thanks to the following events: on December 15 AXL Strategic Partners, a company which specializes in the evaluation of start-ups and high-risk business investments, invested $ 1.1 million in Chronobank.
AXL Strategic Partners is part of AXL Group Holdings which specializes in areas such as a juridical and legal support (http://axllegal.com.au/ ), assistance in investment deals for Australian and international investors, loans and investments in real estate (http://axl.financial/).
AXL Strategic Partners was founded in 2006 and was registered on the ASIC (The Australian Securities & Investments Commission, the only Australian state financial regulator that controls all financial market participants, including companies and individuals.)
To date, it is a unique case when a third-party institutional investor invests in the project during the ICO stage and choses to buy tokens instead of shares of the company.
This move demonstrates the fact that the potential of Chronobank’s business model was valued not only by the crypto-community, but also by traditional venture capital investors. In more traditional investment terms, AXL Strategic Partners participated in the seed investment round on the general ICO conditions by buying TIME tokens. This demonstrates the confidence of the investment fund in the infrastructure that was created by Chronobank founders.
With further development of the project, the presence of an institutional investor at the seed stage will make it easier for the founders to find other venture capital investors which may raise interest in the project from the traditional players in the venture capital industry. This can have a positive effect on the value of TIME tokens sold during the ICO. This can bring other benefits primarily to the investors that were included in the company's capital at the current stage.
It should be noted that by increasing the rating this does not imply that a number of risks inherent to the project have been removed altogether, but it does reduce their probability.
The history of Chronobank’s ratings:
01/12/2016 - Project was rated Stable.
20.12.2016 - The investment attractiveness rating for Chronobank was upgraded to Stable +. Rationale: The participation of institutional investors in the ICO for the amount of $1.1 million.
The Chronobank project is built on innovation and solving a number of problems in one of the fundamental sectors of the market economy - the labour market in Australia (one of the largest economies in the world). This, plus the fact that the project has grown from a recruiting company with almost 10 years experience in the market makes it unique to the ICO market. However, most of the ideas in this segment are theoretical and were born in artificial conditions, but not in practice.
The relevance and validity of the problems which can be solved using the infrastructure built on the blockchain technology makes this project attractive for long-term investment.
The scalability of ideas, plans to enter markets outside of Australia (UK, US, EU), an experienced management team from Edway Group’s founders and a team of blockchain developers significantly increases the chances of this project being successful.
It should be noted that as with any innovative idea, the project may face a number of difficulties: first and foremost are the legal aspects of the second phase, specifically during product launch (Uber still faces this problem in many countries, and its model is much simpler than Chronobank’s). Also, the project still needs to prove its ability to maintain a stable value for the tokens tied to the actual macroeconomic indicators and demonstrate quality implementation of many other technical aspects.
This project should be interesting, first of all, for investors that are focused on fundamental investments for the medium and long-term time period. It would not be reasonable to expect sharp speculative growth when the tokens enter the secondary market. The Chronobank model implies regular dividend payments, which makes the Time tokens more like traditional stocks, especially given the possibility of voting on issues the project encounters during development.
Considering the scale of the project and the size of the market in which it operates, the long-term potential of the TIME tokens’ cost growth could be very significant. Given that the founders plan to at some point in the future hold another round of investment within the traditional venture capital industry, the first wave of investors may at this stage withdraw from the project with serious profits, but it would not be very reasonable.
These type of investments usually pay off by the time the project reaches ‘critical mass’, i.e. tokens quotations may be stable for a long time and at some point began to show impressive growth.
As a result, the project can be attributed to this investment category and is primarily attractive for long-term investments.