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BlockCloud Rating Review

Risky

Investment Rating

Expiry date 16 Nov 2018 16 Aug 2018

Based on our analysis we have decided to assign the Blockcloud project a “Risky” rating, with a favorable outlook for the future due to several strengths the project has.

Disclaimer: We draw attention to the fact that the project is at a relatively early stage (currently there is no information available about the pre-sale, private sale or ICO). The ICO details or token metrics are not specified in the Whitepaper or on the project website. We also understand that the smart contract code can only be published once the token metrics are known, nevertheless, it is worth mentioning the absence of this information at the time of analysis. The Whitepaper is purely technical, therefore it is not possible to draw conclusions regarding the use of proceeds, bounty program, etc. At the time of writing, the team had not yet published any code on GitHub or its Medium profile. In the following analysis we do not consider this as risk.

The positive factors that were taken into account, were:

  • The proposal of significant TCP/IP architecture improvements.

  • Great team.

The negative factors that were taken into account, were:

MVP was not released

The MVP has not yet been released. The mainnet launch is set for Q2 2019. Prior to this date, no releases are set.

Development risk, no public GitHub

The private sale will take place in Q3 2018 and the testnet will be launched in Q2 2019 resulting in 9 months of uncertainty where anything can happen. Despite the team announcement of goal achievement and completion of the infrastructure design, and the proofs of POS mechanism, CoDAG algorithm, and online double auction algorithm recently there is no way to prove it as there is no GitHub.

Incomprehensive Technical Whitepaper

The released Whitepaper is theoretical, without any description of the team’s development achievements or any technical description. There is also no information about how the project plans to earn money. Without any business information, such as marketing, market share goals, cost of maintaining the network, it is hard to judge how sound project’s plans are.

Decrease in token price

Blockcloud will operate in a highly competitive market, so it is possible that the market may have a positive pressure on the price.

Commercial risks

Structural projects for the IoT is not a new niche. There already are a number of big players, like IOTA, that Blockcloud will unavoidably be compared to. Therefore, Blockcloud will need to prove its superiority in order to gain success.

Based on the analysis performed and taking into consideration all of the risks associated with the Blockcloud project as of August 2018, we decided to assign the Blockcloud project a “Risky” rating. Once the project develops the MVP, adds more detailed descriptions of key aspects to the Whitepaper and announces the details of the ICO, the assigned rating may need to be reviewed.

The Internet-of-Things is projected to connect 20 billion devices by 2022. The team used numbers provided by Ericsson in its 2017 mobility report. Statista estimates the number of connected devices to be 42 billion by 2022 and 75 billion in 2025. The present IoT architectures, which are based on Internet design, apart from Internet strength, have also adopted its weaknesses like security and scalability issues.

Blockcloud’s aim is to create the next generation TCP\IP architecture. By combining blockchain and Service-centric Networking approaches with modern Internet-of-Things architecture, the team aims to create a blockchain infrastructure suitable for processing dynamic and asynchronous data flows, typical for the Internet-of-Things.

The project team notes that modern IoT solutions, both centralized and decentralized, are subject to mobility, scalability, trust and security issues. Also, the present network does not incentivize service providers to join the network. Blockcloud plans to solve this problem through token awards. Token distribution will be governed by a Proof-of-Contribution consensus mechanism developed by team, that is believed to be more suitable for IoT blockchain.

As of August 2018, the Blockcloud team had only published the Technical Whitepaper. Almost no information on ICO is available. On official website there is no information about the amount of tokens available in the private sale, 1.5 billion BLOC (Blockcloud token ticker). The total Hard cap is USD 12 million which they hope will be raised in the private sale. Also, project evaluates it value at USD 80 million. The token sale is due to take place in Q3 2018.

The price of one BLOC token will be USD 0.008 at TGE. A lock-up mechanism will be implemented during the private sale. 20% of the tokens will be released before the exchange listing. Two months after listing, 10% of the tokens will be released over the next 8 months.

Since the project is still in its early stages, there is no smart contract available for review and no GitHub profile, despite the team’s announcements that they are actively working on the project.

The token distribution will be as follows:

There is a market cap of USD 80 million, which will be allocated in tokens. The majority will go to mining awards and the foundation, they will be released annually at a rate of 5% over 6 years. The purpose of the foundation remains unclear, as well as what is meant by ‘Other Sale’. There is also no information about how funds will be allocated in terms of development. The risk that the project will not fulfill its promises is high and there is no information about any lock-up periods for the team’s tokens either.

The Blockcloud TCP/IP architecture is created to bring modern Internet-of-Things services to a new level. The team has identified several problems with the current architecture: limited mobility, scalability issues, lack of trust, poor security. Blockcloud will address the first two issues with Service-centric Networking (SCN) and the latter two with blockchain infrastructure.

SCN is a new model of IoT and Internet infrastructure. The main difference is that applications in the network communicate not on the basis of addresses (IP) but on the basis of names. It allows for greater flexibility of the architecture which is more suitable for the IoT, where nodes are dynamic. Also, SCN takes into account the user’s location and performance requirements, when optimizing the location of the user’s service components.

SCN provides increased mobility through the Service Access Layer (SAL) or Serval. The team will be using a Serval networking stack, which they consider the most suitable SCN technology for Blockcloud. In a Serval stack, applications and DAPPs communicate on a name basis, rather than on an address basis. This improves mobility, as it improves the efficiency of load balancing and failover speed.

SCN also increases scalability through Distributed Hash Tables (DHT). The team will be using Coral DHT. Coral reduces the cost of storing data and is also fit for mobile and dynamic networks, like those in IoT.

The security issues will be addressed with blockchain infrastructure, which is known for its security. The Proof-of-Service consensus mechanism and the distributed nature of the network decreases the network’s exposure to attacks.

Proof-of-Service is a consensus mechanism developed by the Blockcloud team for Internet-of-Things blockchain solutions. In such blockchains users can contribute with one of the following resources or combinations of them: storage, computation, relay, bandwidth and data. The sum of those resources is related to the user’s contribution to the network. Under PoS user contribution is continuously checked by miners as they check the proclaimed service level using puzzle-structured mathematical problems like that in Proof-of-Work. If the Quality of Service does not match the announced by service provider level, the latter will be penalized. Verifiers are rewarded with tokens for their work. The Proof-of-Service was created to efficiently track their performance.

Combining SCN and blockchain results in the following architecture:

The transaction layer is the primary layer of the Blockcloud architecture. This is where all of the Blockcloud transactions are arranged into blocks and added to the Blockcloud blockchain. Unlike traditional blockchains, the Blockcloud blockchain allows several blocks to be added to the chain simultaneously. This is achieved through the implementation of the Compacted Directed Acyclic Graph (CoDAG) structure. CoDAG is flexible and can add more than one block to the chain at the same time, which makes it perfect for the asynchronous nature of the Internet-of-Things.

The servicechain layer is where operations are defined. Servicechains can be used to build state machines. Now Blockcloud has two state machines: a global service management machine and a service matching and pricing machine, which supports the Blockcloud marketplace. These machines will support smart contracts written for Blockcloud. New state machines can be added to the servicechain layer if needed.

The routing layer is used to separate routing requests and the provision of services. Due to this, Blockcloud is not tied to any particular service management, allowing multiple service providers to co-exist.

The service layer is where services are provided. Since services are provided on a separate layer, there can be multiple service providers using various IoT devices. Since Blockcloud uses names instead of addresses for communication between applications, one name can refer to a group of devices providing the same service, thus increasing efficiency.

For more details on the technical side of the project, please see its technical whitepaper.

We note that the proposed improvements to the existing TCP/IP architecture do seem to solve the current issues. Nevertheless, we note that the Whitepaper is exclusively theoretical and does not have any description of what was already done, therefore there is no guarantee that the described theories can be successfully implemented in the real world.

Blockcloud was created to make TCP/IP infrastructure more suitable for the requirements of the Internet-of-Things. Blockcloud aims to create a safer, more mobile and scalable architecture for the Internet-of-Things. Though, the project’s users are not limited to IoT solutions. Since Blockcloud is a protocol-level solution, any centralized or decentralized applications, as well as other blockchains, can use it. Just like TCP/IP, anything can run on top of Blockcloud. Though created not only for IoT projects, it is currently the project’s target audience at its current stage of development.

On their official website the project identifies a number of major application spheres:

  • Internet of vehicles.

  • Smart health.

  • Smart home.

  • Edge computing.

  • Sharing economy.

The internet of vehicles is characterized by the unpredictable movements of nodes and their high speed, as well as the need for high security. Serval and CoDAG, which are used in Blockcloud, help to deal with unstable nodes and the blockchain provides security.

The key factors of success in smart health projects are data security and its abundance. Again, Blockcloud can guarantee both via the combination of SCN and blockchain.

In smart home infrastructure, stability is a serious issue. Today, devices rely heavily on centralized gateways, thus making them exposed to risk if the gateway is damaged. Blockchain provides decentralization and SCN allows service monitoring of the environment closer to the end-user, increasing accessibility.

Just like the internet of vehicles, edge computing has to deal with unstable nodes, therefore Blockcloud seems to be appropriate. Also, for edge computing projects the cost of verifying nodes performance is one of the key metrics and Blockcloud can guarantee it through Coral DHT. Edge computing is an extension of cloud computing, where data is analyzed on the IoT device.

Just like many other projects, Blockcloud aims to improve the current sharing economy through decentralization and increased security. However, we note that Blockcloud does not have any specific features that make it more suitable for sharing economy projects than any rival blockchain protocol project.

On top of the TCP/IP architecture, Blockcloud plans to build a marketplace for any service, not necessarily IoT. Just like current TCP/IP projects, Blockcloud is an infrastructural solution. Anyone will be able to offer services on the Blockcloud marketplace, just like anyone will be able to subscribe or buy a service.

This is how marketplace will operate:

To govern trade on the marketplace Blockcloud will use Truthful Continuous Double Auction (TCDA). At the beginning of the auction both buyers and sellers make their offer in relation to the amount of service and the price. At the end, the marketplace matches buyers and sellers and an optimal price is given using the market-clearing price formula. The TCDA mechanism prevents cheating, lowers the costs and increases fairness of the marketplace. More information about the TCDA mechanism is available here.

The team has not yet released any business documents, therefore the sources of income for Blockcloud are unknown. Presumably, like with TCP/IP, Blockcloud will charge fees for access to its infrastructure, but it is not certain.

By now Blockcloud has been tested. The official site states that around 8,000,000+ users are already connected to Blockcloud. However, the testnet will not be launched until Q2 2019.

The project team provides the following roadmap:

Despite being very precise, this roadmap has several issues. First of all, there is a nine-month period between the token sale and the release of the main testnet. The team’s incentive and motivation to work on the testnet after the token sale is unclear, since information on lock-ups is not available. Also, for almost a year, there will be no releases from the team, so project development is not transparent, thus increasing the risks for potential investors. Furthermore, at the time of analysis, the project had no GitHub profile, so we were unable to check the progress of development.

In addition, on the date of the analysis, the team had not yet announced any information about the business aspects of the roadmap. No information on the marketing campaign was given either. The only fact known was that there are more than 100 applications to become a Blockcloud partner according to the project’s telegram channel.

We conclude that this roadmap has two issues: a lack of transparency and an absence of business information/milestones.

In their 2017 annual report, Ericsson forecasted the number of interconnected IoT devices to reach 22 billion by 2022. In their June 2018 mobility report this figure was increased to 31.4 billion by 2023. Statista is more optimistic, estimating this figure to reach 51.11 billion in the same year. The two forecasts are represented in the chart below.

Ericsson estimates the compound annual growth rate to be 10.2% and Statista – 14.6%.

Despite the level of market growth appearing to show great prospects, the Internet-of-Things will face significant problems. The modern architecture is not suitable for such an enormous amount of devices. In addition, the current IoT architecture suffers from a lack of security and an absence of financial incentives for providers to participate in the network due to a lack of clarity of the financial returns.

Blockcloud aims to improve the present TCP/IP architecture and communication between underlying IoT devices, by combining blockchain and Service-centric networking stacks. This combination is supposed to bring security, trust, increased mobility and scalability to the present architecture.

In the Whitepaper and on the official web-page there is no information about which projects the team consider to be major competitors. The following competitors were selected by us according to the available information.

 

BLOCKCLOUD

IOTA

BYTEBALL

IOT CHAIN

Ticker

BLOC

MIOTA

GBYTE

ITC

Key functions/features

A protocol-level solution for the Internet-of-Things using CoDAG and SCN to support the dynamic and asynchronous nature of the Internet-of-Things.

A protocol-level solution for the Internet-of-Things using DAG that increases security, scalability, mobility and trust.

Decentralized data using the DAG approach to create a more efficient decentralized ledger.

A blockchain based operating system, using DAG, to connect IoT devices and create a global network. It uses a PBFT consensus mechanism.

Key users

Anyone, but especially Smart home, Internet of vehicles and other IoT projects.

Anyone, but especially Smart home, Internet of vehicles and other IoT projects.

Anyone

Anyone, but especially Smart home, Internet of vehicles and other IoT projects.

Key products

TCP/IP architecture for the Internet-of-Things.

Open-source distributed ledger for Internet-of-Things.

Cryptocurrency using DAG technology.

Lite operating system for IoT.

Development stage

Early development stage.

Mainnet launched.

Crypto was distributed.

MVP is being developing.

ICO status

Private sale in Q3 2018.

Ended.

Ended.

Ended.

ICO date

Q3 2018

25.11.2015 – 21.12.2015

25.12.2016-04.11.2017

24.11.2015

Funds collected as of ICO date/Hard cap

N/A / USD 12,000,000

USD 434,511 / N/A

N/A

USD 23,500,000/ USD 23,500,000

Percentage of tokens for sale

15%

N/A

N/A

50%

Valuation on date of ICO

USD 80,000,000

N/A

N/A

USD 47,000,000

Market capitalization

N/A

USD 1,372,239,462

USD 35,768,296

USD 9,650,451

Blockcloud is entering a very competitive market. IOTA was one of the first companies to approach IoT suitable architecture. The project is considered to be one of the most successful ICO’s ever with a ROI estimated at a hundred thousand percent. IoT chain is another competitor targeting the Chinese market. It has established strong connections with IoT device manufacturers.

Byteball is considered a competitor of Blockcloud, despite not targeting the IoT sphere, as it is one of the biggest DAG projects making its infrastructure suitable for use in a lot of IoT of projects.

All projects, apart from Blockcloud, use DAG as a part of their consensus mechanism when it comes to adding transactions to the block. Blockcloud uses an improved version of DAG, Compacted DAG (CoDAG).

IOTA is using consensus mechanisms based on the transaction confidence metric. Blockcloud uses Proof-of-Service and IoT Chain uses the Practical Byzantine Fault Tolerance algorithm. Byteball’s consensus mechanism is based on the Directed Acyclic Graph (DAG).

As previously mentioned, Proof-of-Service appears to be more suitable for IoT oriented networks, as it captures IoT’s service-centric nature. However, this mechanism has not yet been tested, therefore it is unclear if it will perform well or not. The PBFT mechanism was successfully implemented by Ripple and is considered to require less effort than PoW.

Byteball does not use PoW or PoS. Byteball gives detailed explanation of their consensus mechanism here.

We conclude that although Blockcloud claim that the combination of SCN and blockchain technology brings significant benefits to the IoT architecture, there are a number of other successful projects in this sphere that have the advantage of being first, therefore Blockcloud’s prospects are unclear.

 

We note that the project’s team consists mainly of scholars, with experience in Huawei, Alibaba, Baidu, Tencent, etc. Also, the advisory board seems to be excessive, since it is bigger than the core project team.

 

 

Zhongxing Ming

Shu Yang

Position

CEO

Chairman

Total experience

5+ years

0+ years

Relevant experience

Yes (Digital + IoT)

Yes (Blockchain)

Relevant education

Yes

Yes

Professional achievements

Visiting Scholar at Princeton University,

Ph.D. from Tsinghua University, Member of Blockchain Special Committee of China Computer Federation, Founder of a company with more than 5 million end users.

Head of Scene Lab, Member of Blockchain Special Committee of China Computer Federation.

LinkedIn

Yes

Yes

Affiliation with project

Yes

Yes

Connections

472

16

Endorsements / Recommendations

No

No

 

 

Dai Pan

Dong Huo

Position

Co-Founder/COO

Strategic Scientist

Total experience

0+ years

N/A

Relevant experience

Yes (Startups)

N/A

Relevant education

N/A

Yes

Professional achievements

Urban Intelligence Expert, High-Level Expert in Shenzhen, China, Co-Founder of a startup with USD 6.5 million raised..

Ph.D. from the University of Tokyo, United Nations Development Program (UNDP) Sustainability Goal (SDG) Network Expert.

LinkedIn

Yes

No

Affiliation with project

Yes

N/A

Connections

3

N/A

Endorsements / Recommendations

No

N/A

 

 

Qi LI

Wei Xiao

Position

Expert of Network Security and Cryptography

Data Scientist

Total experience

N/a

N/A

Relevant experience

Yes (Security)

Yes (Artificial Intelligence)

Relevant education

Yes

Yes

Professional achievements

Network Security Expert, Editor of IEEE/TDSC, Over 60 publications on Top Conferences and Journals.

Multiple major inventions, Author of over 20 Patents.

LinkedIn

No

No

Affiliation with project

N/A

N/A

Connections

N/A

N/A

Endorsements / Recommendations

N/A

N/A


 

 

Claire Xiong

Kun Liu

Position

Director of Business and Communications

Head of Marketing

Total experience

N/A

N/A

Relevant experience

Yes (Startups)

Yes (Marketing)

Relevant education

Yes

Yes

Professional achievements

Graduated from UC Berkeley at the age of 19, with a dual degree in Economics and Communications, Director of Innovation Department at Plug and Play in China.

Used to work at Alibaba, Baidu, 8 years of experience in marketing.

LinkedIn

No

Yes

Affiliation with project

N/A

Yes

Connections

N/A

0

Endorsements / Recommendations

N/A

No

 

 

Kun Hu

Zhenzhou Wu

Position

Head of Development

Cloud Platform Director

Total experience

N/A

N/A

Relevant experience

Yes (Development)

Yes (Development)

Relevant education

Yes

N/A

Professional achievements

Senior Architect at Huawei, 7 years of project development experience,

3 years of project management experience.

Proficient in Lisp language, Chief Architect of an online game with hundreds of millions of users.

LinkedIn

Yes

Yes

Affiliation with project

Yes

Yes

Connections

16

N/A

Endorsements / Recommendations

No

N/A

 

 

Peter Ran

Lucy Liu

Position

Director of Business Development in North America

Director of Marketing in North America

Total experience

N/A

N/A

Relevant experience

No

No

Relevant education

No

Yes

Professional achievements

Work experience at Bear Stearns and Southern Fund Management,

Partner at Huson and Chief Representative of Yixing Capital.

Senior PWC (USA) Auditor,

New York State Department of Labor Third Party Management Company Accountant.

LinkedIn

No

No

Affiliation with project

N/A

N/A

Connections

N/A

N/A

Endorsements / Recommendations

N/A

N/A

Advisors

 

 

Fred Baker

Hoan Soo Lee

Position

Advisor

Advisor

Total experience

30+ years

N/A

Relevant experience

Yes (Internet Development)

No

Relevant education

Yes

Yes

Professional achievements

Co-Authored numerous internet standards, Internet pioneer.

Economist of the Council of Economic Adviser (CEA) during the first term of Obama government, Partner of CMB International, Co-Founder and COO of Give2gether.

LinkedIn

Yes

Yes

Affiliation with project

No

No

Connections

500+

500+

Endorsements / Recommendations

No

No

 

 

Jiangchuan Liu

F. Richard Yu

Position

Advisor

Advisor

Total experience

15+ years

10+ years

Relevant experience

Yes (Computer Science)

Yes (Internet-of-Things)

Relevant education

Yes

No

Professional achievements

252 international academic papers, 2 international patents, 7 software products.

EEE Fellow, IET Fellow, National "Thousand People Plan" and "Oversea Plan" specially-invited expert.

LinkedIn

Yes

Yes

Affiliation with project

No

No

Connections

286

383

Endorsements / Recommendations

No

No


 

 

Ke Xu

Dan Wang

Position

Advisor

Advisor

Total experience

N/A

N/A

Relevant experience

Yes (Internet, Blockchain)

Yes (Internet-of-Things)

Relevant education

Yes

Yes

Professional achievements

Engaged in research on the structure of future internet systems, P2P, blockchain technology.

Expert at the National Rail Engineering Center, Chief Designer of Guangzhou TV tower sensor system.

LinkedIn

No

No

Affiliation with project

N/A

N/A

Connections

N/A

N/A

Endorsements / Recommendations

N/A

N/A

 

 

Qian Wang

Linghe Kong

Position

Advisor

Advisor

Total experience

N/A

5+ years

Relevant experience

No

No

Relevant education

N/A

Yes

Professional achievements

Expert of Recruitment Program of Young Overseas High-Level Talents, Professor and Doctoral Supervisor at Wuhan University, Ph.D. from Illinois Institute of Technology.

-

LinkedIn

No

Yes

Affiliation with project

N/A

No

Connections

N/A

307

Endorsements / Recommendations

N/A

No

 

 

Sheng Zhong

Qianhong Wu

Position

Advisor

Advisor

Total experience

N/A

N/A

Relevant experience

Yes (Computer Science)

Yes (Cryptography)

Relevant education

Yes

Yes

Professional achievements

Director of the Department of Computer Science and Technology, Member of Jiangsu Provincial Committee of the Chinese People's Political Consultative Conference.

In charge of 7 national research projects in China, Spain and Australia, one of the major researchers in more than 10 international and domestic projects including the 7th EU Planning, 7 invention patents, about 100 research papers.

LinkedIn

No

Yes

Affiliation with project

N/A

No

Connections

N/A

307

Endorsements / Recommendations

N/A

No

 

 

Kun Yang

Liehuang Zhu

Position

Advisor

Advisor

Total experience

N/A

N/A

Relevant experience

Yes (Computer Science)

Yes (Computer Science)

Relevant education

Yes

Yes

Professional achievements

Distinguished Professor of the Recruitment Program of Global Experts, Professor of the University of Electronic Science and Technology of China.

Assistant Dean to the School of Computer Science & Technology, BIT, Professor in professional charge of network and information security, Professor in professional charge of the undergraduate program of the Internet of Things Engineering.

LinkedIn

No

No

Affiliation with project

N/A

N/A

Connections

N/A

N/A

Endorsements / Recommendations

N/A

N/A


 

 

Ingwei Xu

Ahmed Alsayadi

Position

Advisor

Advisor

Total experience

15+ years

5+ years

Relevant experience

Yes (Networks Development)

Yes (Blockchain)

Relevant education

Yes

Yes

Professional achievements

Engaged in research on computer networking and obtaining outstanding achievements in high-performance networks, internet routing and next generation system structures.

One of the earliest Global Blockchain Architects.

LinkedIn

Yes

Yes

Affiliation with project

No

No

Connections

201

500+

Endorsements / Recommendations

No

No

 

 

Guang Cheng

Haiban Kan

Position

Advisor

Advisor

Total experience

N/A

N/A

Relevant experience

Yes (Computer Science)

Yes (Computer Science)

Relevant education

Yes

Yes

Professional achievements

Director of Computer Networks and Information Integration at the Ministry of Education (Southeast University) Key Lab, Secretary of the Party Committee of the School of Computer Science and Engineering and the College of Software Engineering, Southeast University.

Professor and Doctoral supervisor at Fudan University, Leader of Coding and Information Security Laboratory and Institute of Computer Theory.

LinkedIn

No

No

Affiliation with project

N/A

N/A

Connections

N/A

N/A

Endorsements / Recommendations

N/A

N/A

We note that the Blockcloud team consists of well-educated scholars, with experience in Internet development, Internet-of-Things cryptography and computer science. According to Blockcloud’s official page on LinkedIn the team has more than 50 publications in international journals. Also, the team has founded a smart home company that has risen more than 40 million yuan. Undoubtedly, the team knows the problems of TCP\IP and IoT architecture. However, only a few members of the team have experience in blockchain projects, and the majority of advisors don’t have any experience in this area either. Also, the project has more advisors than team members. It is a matter of concern, if team is able to effectively communicate and partner with all advisors. Nevertheless, the project has a strong team of advisors that can have a significant impact on the project. We note, however, that none of the advisors list their affiliation with the Blockcloud project on their LinkedIn profiles. There are also no links to the advisors’ LinkedIn profiles in the team section on the official web-site.

Team has announced that they have more than 100 partnership offers, though no information about these companies was disclosed.

The project will make 1.5 billion tokens available for sale in the private sale in Q3 2018. The Hard cap is set at USD 12 million. It is known that the price of one BLOC (Blockcloud token) will be USD 0.0008. Only 15% of all tokens will go to the private sale. The team will keep 10% and 60% will go to the miners and the foundation. There is no information about team’s token lock-up, but private sale tokens will be released at a rate of 10% every month, for 8 months and 20% of tokens will be released before the exchange listing. This scheme does not look safe since the team may give up on project and easily walk away from it.

The token economics of the project are not well described either. It is known that the BLOC token will be used to reward miners, supporting the chain using the Proof-of-Service consensus mechanism. Also, tokens will be needed to access the Blockcloud infrastructure. Users will be required to deposit tokens into their account to get access to the infrastructure. In case of any bad behavior, users will be punished. For example, part of their collateral, equal to the price of service they committed to provide, will be extracted and go to miner, who identified the behavior. It remains unclear whether users will be able to pay for services in the Blockcloud marketplace with BLOC tokens.

Blockcloud will not charge fees for transactions as the frequency is too high and the volume transactions is too very low.

Since users are incentivized to hold BLOC for a long time, the token velocity will go down. This may have a positive effect on the price of BLOC tokens.

It is unclear whether there will be an extra token emission in the future as Blockcloud grows. We note that the presence of future emission may drive the token price down.

FACTOR

DESCRIPTION

PRICE EFFECT

Development and release of new products according to the roadmap

Blockcloud had not released any MVP by the date of analysis. Once the MVP or mainnet are launched, the market will react according to the level of correspondence of the released version in relation to the promised characteristics. This can result in both an increase and decrease in token price.

⬆︎⬇︎

Demand for the platform

The BLOC price is directly tied to the number of transactions on the platform. Therefore, the higher the demand for platform, the higher the demand for the token, which will increase the price accordingly, and will work vice versa too. Since Blockcloud will operate in a competitive market, success is not guaranteed.

⬆︎⬇︎

Token emission

For 6 years after the token sale, the project will release 5% of the token supply as a mining reward. As new tokens will dilute the distributed token value, it will put positive pressure on the token price.

⬇︎

Sale of tokens by the team, early contributors, etc.

At the time of analysis, no information on lock-ups was available. If the team or early contributors decide to sell their tokens, the price will go down.

⬇︎

Sale of tokens by private sale investors

Private sale participants will receive 15% of all tokens. This amount is enough to influence the price in case of a crowd sale.

⬇︎

Volatility of cryptomarket

As with any token, they are all, to some extent, correlated with the cryptomarket and follow its trends.

⬆︎⬇︎

Cost of services on the platform

BLOC can be used as a collateral on the Blockcloud platform. Users will have to deposit tokens to support service being provided. Therefore, the cost of service provision will directly influence the price of BLOC.

⬆︎⬇︎

Usability of token

By now, users of the Blockcloud platform do not have many options to spend the token, plus they need to hold a fixed sum to get access to the platform. In this case, users will treat BLOC as an inventory token, trying to bring its amount to an optimal level, thus reducing the demand and lowering the price.

⬇︎

Token velocity

According to the available information BLOC will not have a high velocity as users do not have many places to spend it. If the situation changes and the velocity increases, the token price may go down and vice versa.

⬆︎⬇︎

RISK

DESCRIPTION

LEVEL

Lack of information about the token metrics and ICO details. Smart contract code not available on GitHub.

Disclaimer: We draw attention to the fact that neither the ICO details nor the token metrics are fully specified in the Whitepaper or on the project website. We understand that the smart contract code can be published only when the token metrics are known, but nevertheless, we draw attention to its absence as of the date of analysis.

 

MVP was not released

The MVP has not yet been released. The mainnet launch is set for Q2 2019. Prior to this date, no releases are set.

High

Development risk, no public GitHub

The private sale will take place in Q3 2018 and the testnet will be launched in Q2 2019 resulting in 9 months of uncertainty where anything can happen. Despite the team announcement of goal achievement and completion of the infrastructure design, and the proofs of POS mechanism, CoDAG algorithm, and online double auction algorithm recently there is no way to prove it as there is no GitHub

 

High

 

Incomprehensive Technical Whitepaper

The released Whitepaper is theoretical, without any description of the team’s development achievements or any technical description. There is also no information about how the project plans to earn money. Without any business information, such as marketing, market share goals, cost of maintaining the network, it is hard to judge how sound project’s plans are.

 

Medium

 

Decrease in token price

Blockcloud will operate in a highly competitive market, so it is possible that the market may have a positive pressure on the price.

Medium

Strong competition

Structural projects for the IoT is not a new niche. There already are a number of big players, like IOTA, that Blockcloud will unavoidably be compared to. Therefore, Blockcloud will need to prove its superiority in order to gain success.

 

Medium

 

Team composition and expertise

Despite having little experience with blockchain projects, the team has great experience in terms of TCP/IT architecture and digital projects. Furthermore, the team is strengthened by its large advisory board.

 

Low

 

Incomprehensive roadmap

The roadmap only covers the technical aspects of the project, and does not specify the business development process in much detail or the team’s plans regarding market coverage/number of platform users, etc.

 

Low

 

Legal/commercial risks

Users data security will be a major concern for Blockcloud, as users may supply sensitive information. It is a part of blockchain’s nature to guarantee a high level of security.

 

Low

 

 

 

 

The information contained in the document is for informational purposes only. The views ex-pressed in this document are solely personal stance of the ICOrating Team, based on data from open access and information that developers provided to the team through Skype, email or other means of communication.

Our goal is to increase the transparency and reliability of the young ICO market and to minimize the risk of fraud.

We appreciate feedback with constructive comments, suggestions and ideas on how to make the analysis more comprehensive and informative.