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Caspian Rating Review

Stable

Investment Rating

Expiry date : Expired 03 Jan 2019

Rating report

We have reviewed project's progress as of January 2019 and identified that the project's development is not in line with the roadmap, there is still no available working product, there has been only one update from the team in December 2018. We note that according to official telegram group the product is already live, but will not be released to public for free. The team provides demonstration videos in its official telegram group, however we note that we have not seen the product ourselves. In addition to that, the team claims that their product is being used by several major funds, therefore project rating has been set to Stable.

We draw attention to the fact that the project is currently vulnerable and dependent upon favorable business, financial, and economic conditions to meet its commitments on deliverables. In the event of adverse business, financial, or economic conditions, the team is not likely to have the capacity to meet its commitments on the project. This outlook assesses the potential direction of the project; in determining a rating, consideration is given to any changes in economic and/or fundamental business conditions. This outlook is not necessarily a precursor of a rating change or future team actions.

The project has the following strengths worth noting:

  • An ambitious idea
  • High social media coverage
  • Strong team and advisory board
  • Strong strategic partnerships
  • There is a live private platform available
  • Good hype around the project

However, there are also a number of risks associated with this ICO project:

MVP

The project is based on a technologically complex idea, which requires a large number of different stages of testing and coordination within the team. This project is a centralized platform with a decentralized tokenization aspect. There is a live version (of a centralized platform), which is available for 15 funds using it, accessing 30 exchanges. According to information from the team, it will be released publicly within 30 days of the end of the sale. The team doesn’t provide a link to the GitHub account on the project’s website, but it has been privately provided and several ICO details have been verified. The sale contract’s GitHub will be published closer to the time of the sale.

Development

The project is still under development and may undergo significant changes over time. Although it is intended that the project follows the specifications set forth in this document, and the team will endeavor to work towards those ends (subject to internal business considerations), changes may be required to be made to the specifications of CSP or the Caspian Project for any number of reasons, but according to information received from the team, the project is 95% feature-complete for this first version, and will be 100% feature-complete by the time of the public sale.

Non-comprehensive whitepaper

The whitepaper does not include competitor analysis, ICO details such as pre-sale dates, the vesting terms are not specified, lock-ups are not disclosed by category and do not cover the long-term horizon, the min/max contributions for pre-sale/ICO and bonuses/discounts presence are disclosed in the pre-sale sheet but require further specification; There is no publicly available information regarding countries on the restricted list. Given that there is no publicly available beta or MVP as yet, there is a live platform for several institutional investors available (in theory, the system is available for everyone, however its depth of functionality is most likely beyond that which an average retail trader would need. It is more appropriate for professional traders and investors). All the above-mentioned information could increase the risk for potential investors.         

Non-comprehensive roadmap

There are several available roadmaps within the project’s documentation which differ slightly from each other. Among the disadvantages of the roadmaps provided the following should be mentioned: The MVP (by stages) release dates are not determined; the longest period covered is only up to Q1 2019. The milestones mostly cover the technical aspects of the project and do not directly lay out the business development process – e.g. when and how marketing activities will be performed, how many users of the platform the company intends to reach by the end of each stage, etc. According to information received from the team, the product’s development was started 15 years ago as an equity trading platform, and Caspian extends this platform’s functionality to crypto trading. The team states that the roadmaps are more for technical details, while marketing activities have been ongoing. The project currently has over 170 clients waiting to be onboarded to the Caspian system following the public sale. Tora Trading has extensive experience marketing software platforms to financial institutions, and will be leading the efforts for Caspian in the early stages.

Based on the analysis performed and taking into consideration all of the risks associated with the Caspian project as of September 2018, we assign the Caspian project a “Stable+” rating.

Project & ICO information

Caspian is a complete asset management solution that covers the lifecycle of a trade. It includes a fully developed OEMS, PMS, and RMS. It provides a single interface with all the major crypto exchanges, a complete suite of sophisticated trading algorithms, real-time and historical P&L and exposure tracking and professional customer service.

The project has the following public pages:

Website

Whitepaper

Twitter

Medium

Telegram

YouTube

LinkedIn

 

PRE-SALE

PUBLIC SALE

Start date

Mid-July

October 17, 2018

End date

Mid-September

October 19, 2018

Stage cap

No

 

Ticker

CSP

Token

ERC-20

Token supply (for sale/total)

400,000,000 / 1,000,000,000

Soft cap

USD 5 mln (already reached)

Hard cap

USD 16 mln

USD 19.5 mln (total)

Estimated capitalization (Total valuation = Hard cap/tokens for sale * total token supply)

 USD 48.75 mln

Token price (official Telegram group)

1 CSP TOKEN = 0.04875 USD

 

 

Discounts/Bonuses

Pre-sale: 10%

 

Lock-ups

Pre-sale lock-up: 6 mth partial

 

Min/Max contribution

USD 200 k/No data

No data

 

Currencies accepted

ETH

ETH

 

Restricted list

USA, China

 

 

KYC procedures

Yes

 

 

Country of legislation

Cayman Islands

 

 

               

The project ran an airdrop campaign which has already ended. The total amount of tokens allocated for the challenge was CSP 4,081,633, from which 1,481,130 (36%) have been collected.

The following achievements were encouraged:

  • Joining Telegram community (reward 10 CSP)
  • Inviting 3 friends to the community (reward 50 CSP)
  • Inviting additional 4 members (reward 80 CSP)
  • Answer member’s questions (reward 30 CSP)
  • Conversation starter (reward 40 CSP)
  • Follow Caspian’s twitter (reward 30 CSP)
  • Medium maximum clap – 50 times (reward 30 CSP)
  • Participate in Caspian’s Trivia (reward 30 CSP)
  • Win in Caspian’s Trivia (reward 60 CSP)
  • Complete all achievements (reward 100 CSP)

The following distribution scheme is presented on the project’s website:

Information regarding the fate of unsold tokens is not disclosed.

The team has provided the following funding allocation scheme:

The use of proceeds allocation scheme looks reasonable, however, the team doesn’t disclose in details what is meant under each type of expenses.

We believe that the whitepaper has the following issues:

  • The vesting terms require further clarification; lock-ups are not disclosed by category and do not cover the long-term horizon.  Lock-up data is absent in the smart contract code provided due to security considerations, according to the team.
  • The ICO details require further specification, such as details of pre-sale dates, min/max contributions for pre-sale/ICO, bonuses/discounts, and information regarding soft/stage cap are not disclosed neither in the WP nor on the project’s website.

The project presents forecasts of marketing activities and plans for product promotion plus a wide list of established partnerships; the hardcap is almost reached; all the above-mentioned information should not significantly increase the level of risk for potential investors.

Technical overview

As a reminder, Caspian is a complete asset management solution that covers the lifecycle of a trade.

Caspian is a cloud-based platform with distributed services built around a microservice architecture, and functionality accessible via thin UIs and APIs. This creates significant flexibility, allowing the platform to accommodate solutions ranging from private clouds hosted in a client’s traditional datacenter to environments supporting large numbers of clients hosted on cloud computing platforms provided by established players in the space.

Each aspect of the system is managed by a distinct service with a dedicated communication channel, its own API, and a built-in protocol for subscribing to its data. On the back end, the services are either configured to run in dedicated processes, or several (usually related) services can be bound together to run into a single process. The services can offer data through both a request/reply and a publish/subscribe mechanism.

The following architecture is represented in the WP:

According to the available documentation, the backend services are linked by a high speed, certified message delivery technology. This offers a range of advantages:

  • Decoupling of services that do not require mutual awareness of the components that act as their clients.
  • Plug-and-play architecture, enabling the addition of new components to handle new services.
  • Ability to set different communication priorities for various services.
  • Scalability: The plug-and-play architecture makes it easy to add new service instances capable of handling greater loads or accommodating more clients.
  • A built-in mechanism that guarantees no data is lost traveling between the various components.
  • High data throughput.

 

The system is designed to handle large volumes of data while ensuring low latency for messages on their way to and from the exchanges. While Caspian was not initially designed for high frequency trading, the capacity and latency numbers it can achieve nonetheless approximate the performance such a client would require. Specifically, Caspian is designed to handle up to 50,000 orders and 400,000 executions per day per user, with a throughput of over 2,500 orders per second.

 

The technical system has the following features:

Security is the most important. In order to ensure the privacy and integrity of all data flowing through the Caspian ecosystem, the following features are in place:

  • Connectivity between the client application and the cloud is created by a private leased line or by encrypted connections over the internet.
  • The client app access can be limited to that from a set of concrete whitelisted IPs.
  • Secure user sign-in is enforced through “strong” password complexity requirements and two-factor authentication.
  • Access to the back end is restricted to a limited number of authorized administrative and support users.

 

We note the following details in the project’s documentation:

  • Caspian is not a blockchain and so there is no consensus algorithm. The project utilizes ERC-20 tokens on the Ethereum blockchain.

Description of services & their applicability

The system will offer a cloud-based technology platform which will include a portfolio, order and risk management system with full pre-trade compliance monitoring. Caspian is a cloud-based platform, with distributed services built around a micro service architecture, and functionality accessible via thin UIs and APIs.

According information in the whitepaper, the Caspian model is currently envisaged and designed, but is still subject to modification. Caspian effectively aggregates prices, bid/ask information, orders, positions, accounts, and executions from multiple crypto exchanges and other sources, presenting the information on a single platform. It allows users to act on this information by sending orders to exchanges individually or using a Smart Order Router based on existing Tora technology.

The Caspian model consists of several products:

Caspian demonstrates a fully developed OEMS, PMS, and RMS with compliance monitoring tools. It provides a single interface into all major crypto exchanges, a complete suite of sophisticated trading algorithms through a Smart Order Router, real-time and historical P&L and exposure tracking, and 24/7 customer service.

Key features of the OEMS are:

  • Unified trading interface across exchanges
  • Customizable market data
  • Fast order execution and amending
  • Order shortcut management
  • Parent & child order slicing
  • Fully customizable with indicators and breakdowns
  • Utilisation of workflows across multiple distinct users and user roles
  • Audit report generation for all activity in the OEMS
  • Follow the sun support from an award-winning global support team

PMS key features :

  • Real-time and historical P&L over any time interval
  • Customize your views on your portfolios
  • Real-time monitoring of positions across exchanges and wallets
  • Fully integrated with OEMS, PMS, risk and reporting
  • Available reporting module with suite of reports
  • Scales seamlessly as your fund grows

The Caspian Compliance features are:

The Caspian Compliance server checks tens of thousands of simultaneous orders against dozens of complex portfolio-based compliance rules with 0.0005 seconds of latency or less.

Key features are:

  • Permissioned users can set up new compliance checks
  • A full audit trail for every order, available anytime
  • Automation for restricted trading lists
  • Flexible work flows with optional approval protocols
  • New rules delivered dynamically without requiring upgrades

Caspian Risk Management:

An ad hoc report design service provided by Caspian Access and an aggregate of multiple data sources besides Caspian, to enrich reports beyond the scope of Caspian

Caspian Reporting:

Key features are:

  • Report on orders, executions, positions, P&L and exposure
  • Interactive web-based dashboards
  • Default report templates
  • Web-based report designer tool for user-defined reports
  • An ad hoc report design service provided by Caspian
  • Access and aggregate multiple data sources besides Caspian to enrich reports beyond the scope of Caspian

Caspian Algorithms:

The team highlights the following benefits of the product:

The project’s documentation includes the following key features of the Caspian Algorithm:

  • A complete suite of institutional grade trading algorithms including VWAP, TWAP, Implementation Shortfall, and Volume In-line
  • Pairs algorithms that can trade pairs across multiple exchanges and crypto currency pairs with each leg being potentially traded on different venues in different currencies
  • Intelligent smart order router technology takes both commission and exchange fiat and crypto balances into account
  • Integration of algorithms with distributed exchanges and OTC desks, driving liquidity to DEXs
  • Comprehensive post trade TCA reporting capabilities to analyze algorithm performance/exchange execution quality

The description of the project’s services is very detailed and promising; there is a live private platform which will be released publicly within 30 days of the sale’s end. The team doesn’t provide a link to the GitHub account on the project’s website, but it has been privately provided and several ICO details (excepting lock-up information) have been verified.

We’d also like to point out that the team doesn’t describe the motivation for blockchain integration into the system among the project-related documents, since there is no proprietary blockchain model.

Roadmap

The project’s documentation includes several roadmaps which differ slightly from each other. The roadmap is available on the project website, in the official presentation and in the whitepaper.

In the whitepaper the following roadmap is presented:

The project’s presentation provides the following release roadmap:

The website’s roadmap repeats the one from the presentation.

According to information received from the team, the product’s development was started 15 years ago as an equity trading platform and Caspian extends this platform’s functionality to crypto trading. The team says that the roadmaps are more for technical details, while marketing activities have been ongoing. The project currently has over 170 clients waiting to be onboarded to the Caspian system following the public sale. Tora Trading has extensive experience marketing software platforms to financial institutions, and will be leading the efforts for Caspian in the early stages.

We believe the roadmaps have the following problems:

  • The furthest period covered is only Q1 2019
  • The milestones mostly cover the technical aspects of the project and does not directly lay out the business development process – e.g. when and how marketing activities will be performed, how many users the platform the company intends to reach by the end of each stage, etc.

Market outlook

Market overview

Despite the Bitcoin price decline and bear market trend, blockchain technology and cryptocurrencies became an attractive investment tool for private investors, venture capitalists and hedge funds in 2018.

Private and institutional investors are a major driver for cryptocurrencies, pre-sale and crowd-sale. The reasons for this interest are the speculative nature of the crypto market that is able to surge by 50% in 24-hours and provide an average yield that exceeds 3000%.

Currently there are several solutions on the market enabling exchange of one cryptocurrency for another and earn from this exchange.

The most obvious solutions are traditional crypto exchanges that operate in a similar to traditional exchanges, charging a small percentage of the trade in the form of a fee. But given the increasing number of currencies, and especially new tokens of ICO projects, the investor must spend a vast amount of time keeping on top of day-to-day price movements.

More comprehensive solutions include trading platforms and crypto funds.

Trading platforms allow investors to conduct exchange in a peer-to-peer manner, matching selling/buying prices with orders placed by other users. These platforms allow a trade to take place once both amounts match.

Crypto funds allow investors to transfer funds under management, where a portfolio is created depending on the investment focus of the professional analysts in question.

Acting in a similar way to traditional trading platforms and funds, crypto projects at the same time issue native tokens to attract investments, offering token holders additional privileges such as voting rights, rewards, discounts and possible passive income in the event of listing, but don’t guarantee the profitability of an investment strategy.

Moreover, cryptocurrency trading markets currently have fragmented liquidity and high volatility across exchanges which prevents many institutional players entering the market. Moreover, there is no unified trading and analytics platform for cryptocurrency markets. There is also no risk management system in the field of cryptocurrencies. All these challenges can be mitigated by creating a Bloomberg-like platform in the cryptosphere. Therefore, this market has large potential.

Competitive landscape

To evaluate the competitive landscape, the Porter’s Five Forces framework is used.

  • Threat of new entrants – High.

The overall threat of new entrants is high, as the blockchain market is still not yet saturated. The level of competition is gradually rising and there is no absolute market leader.

  • Threat of substitutes - High.

The threat of substitutes is high, as both the blockchain and trading solutions markets are emerging ones. Also, each new project could offer unique trading and investing features based on the experience of already released solutions.

  • Bargaining power of customers – Medium.

The bargaining power of customers and investors can be assessed as medium. The Caspian project intends to focus on trading via exchanges and speculators would appreciate a “one-stop shop” solution, that could be welcomed by the community and investors.

  • Bargaining power of suppliers –Medium/ High.

The supply side of the Caspian project includes exchanges and state regulators. The power of these groups can be assessed as medium-to-high, as the terms of cooperation with exchanges and desire of states to regulate the digital market could significantly affect the project’s development, but there are a lot of blockchain projects in this market already and Caspian can act on their example.

  • Industry rivalry – High.

The Caspian project competes with similar solutions, asset management and crypto funds. Below is a comparison of Caspian with several projects which are not direct competitors.

Project

Caspian

Trade.io

Fox Trading

Astronaut

Crypto20

Strategy

Algorithmic

-

Algorithmic

Algorithmic

Indexing

Investment focus

Cryptocurrencies

Cryptocurrencies; later precious metals, oil, and other commodities will be added

Forex and cryptocurrency markets

Cryptocurrencies and ICO projects

Cryptocurrencies

Profit distribution

n/d

50% (losses distributed as well)

75%

50%

no

Fee structure

n/d

- withdrawal fee: depends on crypto currency (0.0005 BTC, 0.01 ETH, 0.01 LTC, 0.001 BCH, 5 TIO);
- deposit fee: no;
- taker and maker fee: 0.1%

n/d

- performance fee: 10%

- operations fee: 0.5%;
- exit fee: 0.5%

Features

- aggregation of  prices, bid/ask information, orders, positions, accounts and executions;
- execution of transactions individually or via a Smart Order Router;
- portfolio and risk management;
- compliance allows to define limits and rules

- OTC service for traders with a trading volume of over 25,000 USD;
- investments in ICOs;
- ICO advisory service

- signal service alerts on trading signals;
- auto trading system compatible with crypto exchanges and Forex brokers to connect the algorithm with the user's account

- basket of researched and verified ICOs

- based on a hybrid index system, choosing currencies by market cap, with a weekly rebalancing and a component cap of 10%

Token

CSP

TIO

FXT

ASTRO

C20

Platform

Ethereum, ERC-20

Ethereum, ERC-20

Ethereum, ERC-20

Ethereum, ERC-20

Ethereum, ERC-20

Total supply

1,000,000,000

500,000,000

50,000,000

30,000,000

86,206,896

ICO price / Market price

0.04875 USD/ -

0.67597 USD/ 0.14253 USD

0.68000 USD / 0.06008 USD

1.00000 USD / 0.49209 USD

1.10000 USD / 0.70493 USD

ICO dates

October 3rd - October 5th, 2018

December 6th, 2017 - January 3rd, 2018

March 10th - April 7th, 2018

September 24th - October 19th, 2017

October 14th - November 28th, 2018

Hard cap /
Raised funds /
Market cap

19,500,000 USD /
No data /
No data

135,000,000 USD/
31,169,749 USD /
12,816,478 USD

20,000,000 USD /
840,000 USD /
422,394 USD

26,400,000 USD /
2,448,520 USD /
1,630,696 USD

No data /
37,698,373 USD /
28,458,290 USD

Benefits for token holders

- up to 25% discount for token staking;
- up to 25% discount for transaction fees;
- potential dynamic discount (will be announced later);
- top 15 token holders will be engaged in development of the project.

- profit (losses) distribution among Liquidity pool stakers, from 2,500 TIO;
- zero fees till October 1st, 2018


- profit distribution among Trading pool stakers

- profit distribution

- share in the project’s portfolio

Upsides

- established partnership with 25 crypto exchanges;
- significant amount of funds raised during the pre-sale - 16 million USD;
- significant amount share of Reserve fund allows to support the token price

- accepts BTC, ETH, LTC, BCH, TIO;
- announced 4 completed ICOs with 100 million USD raised funds within the advisory service;
- announced 300+ million USD assets under management;
- announced amount of a liquidity pool is 50 million USD

- compatible with 6 crypto exchanges;
-  desktop, iOS and Android trading application versions

- web and Android portfolio tracker application;
- ongoing review of ICO projects

- live portal with portfolio composition and performance;
- fund value as of end of September 2018 is greater than its initial value as of November 2017 (+350%)

Downsides

- absence of detailed fee and commission scheme;
- absence of a profit distribution mechanism;
- accepts only ETH

- a crypto-to-crypto exchange was launched only in more half a year after ICO with initially access of 1,000 pre-selected users;
- only desktop version

- trading pool wasn't launched (15% of ICO funds should be allocated), profit is not distributed;

- dividends were distributed just once in Q4 2017;
- no updates on quarterly reports since Q2 2018

- no updates on quarterly reports since Q2 2018

 

As already noted, the abovementioned projects are not Caspian’s direct competitors. Caspian doesn’t really take assets into management and does not provide trust management services. Key users of its services are  the main institutional investors. It is also worth noting that the project has no blockchain integration.

Based on the comparative analysis above, it may be concluded that all the projects mentioned offer solutions for speculation on the price of cryptocurrencies. Whilst trading platforms allow participants to make their own decisions, crypto funds rely on management decisions. But the basis for both solutions is trading signals in the form of algorithms, indexes or market data. To attract the community, both trading platforms and crypto funds in most cases suggest profit distribution to token holders. Although the Caspian project doesn’t offer a profit distribution mechanism, it benefits from a comprehensive set of features and established partnerships with 25 crypto exchanges. Anyway, it should be mentioned that based on the performance of crypto funds, the results of token holders correlate with market trends.

Taking into account that the crypto market could be described as highly volatile and speculative, it could be assumed that Caspian’s solution would be welcomed by investors looking for market change opportunities. The main features which make the project attractive are order execution, portfolio management, and risk management; there is also the price aggregation from 30 crypto exchanges, but this is not a key functionality or differentiator for the system. Competitive solutions only address either order execution or portfolio management, and very few address robust risk management. The key differentiators are 1) a live product 2) fully featured order execution, portfolio management, and risk management functionality, and 3) extensive signed partnerships and advisors including some of the world’s top brands such as Coinbase and Galaxy. From this point of view, the project could succeed due to its enhanced functionality. But it is worth mentioning that there are a lot of competitive solutions, both within trading platforms and crypto funds. Based on the performance of solutions already implemented it could be noted that the price of native tokens has dropped relative to their ICO period and the performance of these projects correlates with the market trend. These factors could affect the Caspian token price after its token offering.  

Team

The project appears technically complex, therefore it is important to be sure that team members’ experience is sufficient.

Core team

 

Michael Lerch

Robert Dykes

Position

Chairman

CEO & Co-founder

Total experience

No data

25+ years

Relevant experience

No data

Yes

Relevant education

No data

Yes

Professional achievements

Founder and CIO of Evolution Capital Management, holds a B.A. in Politics from Princeton University

Tora CEO for the past 14 years

LinkedIn

No

Yes

Connections

-

500+

Endorsements / Recommendations

-

No

 

 

David Wills

Gerrit Van Wingerden

 

Position

COO & Co-founder

CTO & Co-founder

Total experience

15+ years

25+ years

Relevant experience

Yes

Yes

Relevant education

Yes

Yes

Professional achievements

COO of Kenetic;

spent 10 years as Managing Director and Head of Asia Trading at Och-Ziff Capital and was the former chairperson of HKeX Hedge Fund market council

Managing Director of Tora for the past 12 years;

managed the development of high volume trading applications and analytical tools for various hedge funds and bulge bracket investment banks;

B.S. in Computer Science from Stanford University

LinkedIn

Yes

Yes

Connections

500+

500+

Endorsements / Recommendations

No

No

 

 

Paul Catuna

Jehan Chu

 

Position

CFO

Chief Strategy Officer

Total experience

30+ years

20+ years

Relevant experience

Yes

Yes

Relevant education

Yes

Yes

Professional achievements

Tora’s CFO for the past 10 years;

held senior financial positions at WAGIC, Intertop, and Isonics

Co-founder and Managing Partner of Kenetic;

Former frontend developer with over 10 years' experience in web and enterprise application development;

Founded the Ethereum HK community (2014), and co-Founded the Bitcoin Association of Hong Kong (2014).

LinkedIn

Yes

Yes

Connections

285

500+

Endorsements / Recommendations

No

Yes

         

 

The project website and whitepaper detail only the above-mentioned core team members. Links to their accounts are not provided. We’d like to point out that none of the core team members has blockchain-related experience according to information which can be found on LinkedIn, except Jehan Chu who has been in blockchain since 2013, and has extensive experience as the founder of the Ethereum meetup, Hyperledger meetup, and more; he is not affiliated with the project on LinkedIn. According to information received from the team, Gerrit van Wingerden has been trading crypto for 4 years, and started building exchange APIs 3 years ago.

Another issue is a lack of affiliation with the project for several accounts and the lack of an account at all for the chairman, Michael Lerch.

The following team members were discovered on the project’s LinkedIn account:

 

Peter Blasko

Yannick Duterte

 

Position

Product Manager

Product Manager

Total experience

10+ years

20+ years

Relevant experience

Yes

Yes

Relevant education

Yes

Yes

Professional achievements

Tora’s Director of Software for the past 11 years;

held senior financial positions at WAGIC, Intertop, and Isonics

Vice-President, Product Management for TORA for the past 5 years

LinkedIn

Yes

Yes

Connections

500+

385

Endorsements / Recommendations

No

Yes

         

 

 

Cotyso Bodea

David Tattan

 

Position

Development Director

Head of European development

Total experience

15+ years

15+ years

Relevant experience

Yes

Yes

Relevant education

Yes

Yes

Professional achievements

Tora’s Technical director for the past 7 years;

held senior technical position at Evolution Capital Management LLC;

Software developer at Tora for 4 years

Head of European development at Tora for the past year;

Former VP at Lehman Brothers, head of POINT Client Service EMEA at Barclays IB.

LinkedIn

Yes

Yes

Connections

464

500+

Endorsements / Recommendations

No

No

         

 

 

Ovidiu Campean

Rares-Andrei Hadarean

 

Position

Product Manager

Java Software Developer

Total experience

15+ years

10+ years

Relevant experience

Yes

Yes

Relevant education

Yes

Yes

Professional achievements

Tora’s VP, Product Manager the past 5 years;

Team Lead & Senior Oracle Database Developer at iQuest Tech.

Java Software Developer at Tora

LinkedIn

Yes

Yes

Connections

500+

500+

Endorsements / Recommendations

No

No

         

 

 

Katarina Iamscicov

Ayxan Ayvazli

 

Position

Legal

Corporate Lawyer

Total experience

5+ years

5+ years

Relevant experience

Yes

Yes

Relevant education

Yes

Yes

Professional achievements

Legal function for Tora since 2017.

No

LinkedIn

Yes

Yes

Connections

500+

294

Endorsements / Recommendations

No

No

         

 

 

Jethro Glover

Position

Sales Director

 

Total experience

20+ years

 

Relevant experience

Yes

 

Relevant education

Yes

 

Professional achievements

Tora’s Sales Director for the past 8 years;

Former VP of Credit Suisse.

 

LinkedIn

Yes

 

Connections

500+

 

Endorsements / Recommendations

No

 

 

The project is powered by Tora, the leading provider of advanced investment management technologies supporting the full trading lifecycle, and Kenetic, a blockchain firm committed to expanding the development and adoption of blockchain platforms through investments, advisory services, community and technology. Most team members still work for Tora and have to work for the two companies simultaneously.

As can be seen from above, the team’s composition is quite diverse; together with technical specialists in the blockchain area there are team members with expensive experience in the financial area.

The project’s website and whitepaper provide details of the management board only. In general, the team seems quite complete and professional; disadvantages include a lack of information about Caspian within several accounts and the fact that links on their accounts are not provided on the website or in the whitepaper.

Advisors

LinkedIn accounts for Advisory Board members are not provided either in the WP or on the project’s website.

 

Michael Oved

Ivan DAMGÅRD

Position

Advisor

Advisor

Total experience

15+ years

No data

Relevant experience

Yes

No data

Relevant education

Yes

No data

Professional achievements

Co-Founder AirSwap

According to the project website: Professor and head of the research group in cryptography at Aarhus University. Co-founder of Cryptomathic, Partisia and Sepior;

Member of IACR (International Association for Cryptologic Research)

LinkedIn

Yes

Yes

Connections

500+

184

Endorsements / Recommendations

No

No

 

 

Mona El Isa

Ari Paul

Position

Advisor

Advisor

Total experience

15+ years

10+ years

Relevant experience

Yes

Yes

Relevant education

Yes

Yes

Professional achievements

CEO & Co-founder, Melonport

Former VP of Equities Trading @ Goldman Sachs for 7 years.

CIO of BlockTower Capital

LinkedIn

Yes

Yes

Connections

500+

500+

Endorsements / Recommendations

No

No

 

 

Satoshi Kobayashi

Willi Woo

Position

Advisor

Advisor

Total experience

3 years

No data

Relevant experience

Yes

No data

Relevant education

Yes

No data

Professional achievements

Smart Contract Inc.- Chairman and Co- founder

According to the project website: Active participant in blockchain projects; holds an honors degree in engineering and has twenty years’ experience as a technology entrepreneur

LinkedIn

Yes

Not found

Connections

133

-

Endorsements / Recommendations

No

-

 

Galaxy Digital has joined Caspian as advisor partner to help shape and evolve the technology platform for institutional crypto asset managers and traders. Galaxy Digital is a diversified, multi-service merchant bank dedicated to the digital assets and blockchain technology industry. Caspian will benefit from Galaxy’s expertise in the crypto space and help in guiding software development for the benefit of the crypto community and Caspian’s clients.

The whole advisor team seems really strong; although none of the advisory board members are listed as affiliated with the project on LinkedIn, each of them has publicly tweeted their advisory involvement.

We’d like to note that the Caspian team has already established a group of strategic partners including but not limited to Coinbase, Airswap, BitMex, Gemini, OSL, Smith+Crown, Noble, Blocktower, etc., but the nature of these partnerships remains unclear as there are no official press releases. At the same time all mentioned partners have tweeted regarding their involvement.

Token analytics

The Caspian token (CSP) is an ERC-20 compliant token to be issued on the Ethereum blockchain.

The CSP token model has been designed to serve several principal objectives. In the broadest sense, its goal is to link Caspian’s best-in-class functionality with a token that incentivizes platform use and the development of unique third-party tools and features.

Specifically, the token is intended to create a rich, participatory ecosystem where platform users also become community members with an active interest in the platform. This is accomplished by giving the token user-to-platform utility (discount and governance) and user-to-user/developer utility. Broadly speaking, the token is not required to access the platform but can be used to enhance one’s experience of it through an intentional variety of means and to obtain a variety of benefits. The hope is that users unfamiliar with utility tokens will be incentivized to take steps toward using the token in increasingly complex ways.

In detail, the objectives of the CSP token are as follows:

The CSP token has a commission discount function which has three forms:

  • Guaranteed discount, which establishes a mechanism where users can access a set discount that increases over time
  • A discount payment function to offered to users who pay fees in CSP, a maximum of 25% discount that stacks with other discounts. A user who stakes tokens as part of the guaranteed discount and pays fees in CSP would receive a maximum 50% discount platform fees.
  • Dynamic discount. Caspian intends to develop a dynamic discount program that has the potential to offer a greater discount to those staking tokens. Further details will be released in due course.

 

The CSP token will play a critical role in incentivizing third-party development and integration on top of the Caspian platform. Possibilities include advanced charting libraries, user interface modifications, external trading signal feeds, or stress tests for trading strategies.

Third-party developers will have two options when offering an application or service on the platform:

‘Free apps’ for token stakers

In order to view the ‘free apps,’ users must stake at least one CSP. Beyond that, each app’s token ‘staking price’ indicates its precise staking requirement. Users can only access as many ‘free apps’ as their total staking balance will support. If a user has ten total staked CSPs for the purpose of applications, s/he can only activate the number of apps whose cumulative staking price is ten tokens. This is designed to discourage bloatware whilst still supporting open application development: users aren’t spending tokens, but are rather determining where to allocate scarce resources. This should prevent the adoption of frivolous apps designed to be downloaded by many users. Tokens staked for app access are not eligible for a guaranteed or dynamic discount. This is a variation on the “freemium” model.

The project also offers several ecosystem development incentives and additional development bounties, such as development bounties (to incentivize developers to build out key infrastructure, integration, and plug-ins, etc.) and community bounties (users will have the opportunity to vote for new features or apps they would like the see on the platform).

Caspian will implement a governance function that enables key members of the community to provide input on overall platform development. The top 15 token stakers globally will serve as governance nodes and help guide the development of the platform. Tokens must have been staked for at least six weeks to be eligible for entry into this group. Membership is determined quarterly.

We’d like to note that despite an extensive description of the token’s economy, the rationale behind issuing a native token is still unclear and requires further clarification. The list of CSP token holders’ benefits is unclear as well. The token is designed to enhance the user experience and enrich the Caspian community. It is not designed to be necessary to use the base feature set of the platform. Even without the token, clients can use all the core features of the platform. That said, using the CSP token will provide access to benefits that should be compelling to a wide range of users. The anticipated list of "unique" features is not given in the whitepaper and the benefits of the token economy apart from the discounts are unclear.

Token price factor analysis

We identified the following key factors that may affect the token price:

FACTOR

DESCRIPTION

PRICE EFFECT

Demand for the service

At the date of analysis (late September 2018) it is hard to predict the demand for the platform once it is fully released. But considering the fact that the team is developing the complete asset management solution that covers the lifecycle of the trade the demand on the platform depends on number of users attracted and the successfulness and timeliness of each developed product.

⬆⬆⬇

Development and release of the each products’ stage

Whether or not the team is meeting those milestones and the degree of the product development on each stage will drive the token price up or down. As it not absolutely transparent from the roadmap what are exact products release dates, the team can release them earlier or later from initially planned dates.

⬆⬇

Vesting terms not specified

We note that the vesting terms for the team, advisors and partners are not specified, and that increases risk of token price decrease due to team, advisors and partners selling their tokens once they are listed on exchange.

⬇⬇

Volatility of cryptomarket

Although the platform, token and product do not seem to have speculative purposes, the high volatility of cryptomarkets may cause traders and speculative investors especially at first to trade CSP, which may lead to token price fluctuations for the token or even speculative activities (pump & dump, etc.).

⬆⬇

Limited token supply

Assuming that the company develops as intended and the demand for the solution is sufficient, a limited token supply can result in a long-term deflation of the token price.

Investment risk analysis

RISK

DESCRIPTION

LEVEL

MVP

The project is based on a technologically complex idea, which requires a large number of different stages of testing and coordination within the team. There is a live private platform, which is available and being used by 15 funds able to access 30 exchanges. According to information from the team it will be released publicly within 30 days of the end of the public sale.

 

The team has not provided a link to its GitHub account on the project’s website, but this has been privately provided and several ICO details have been verified. The sale contract GitHub will be published closer to the time of the sale.

Taking into account the information above, we access the MVP risk level as medium.

 Medium

 

Development risks

The project is still under development, and may undergo significant changes over time. Although it is intended that the project follows the specifications set forth in this document, and the team will endeavor to work towards those ends (subject to internal business considerations), changes to the specifications of CSP or the Caspian Project may be required for any number of reasons.

Medium

 

 

 

Non-comprehensive whitepaper

The whitepaper has the following problems:

  • The vesting terms are not specified, lock-ups are not disclosed by category and do not cover the long-term horizon
  • The ICO details requires further specifications, min/max contributions for pre-sale/ICO and bonuses/discounts information is disclosed in the pre-sale sheet, but require further clarification
  • Absence of market / competitor analysis in the whitepaper or on the website
  • There is no publicly available information regarding countries on the restricted list.

Given that there is no publicly available beta or MVP as yet, and a live private platform is available for several institutional investors, all the above mentioned information could increase the risk level for potential investors, we assess a medium risk level.

 Medium

 

Roadmap

The project’s documentation demonstrates several roadmaps which differ slightly from each other. The roadmap has the following disadvantages:

  • The latest period covered is Q1 2019
  • The milestones mostly cover the technical aspects of the project and do not directly lay out the business development process – e.g. when and how marketing activities will be performed, how many users the platform the company intends to reach by the end of each stage, etc.

Medium

 

Market/competitors risks

Caspian have not conducted any competitor analysis. Besides the projects mentioned in our competitive landscape analysis, there are already several projects with an asset management ecosystem idea and crypto funds which also have powerful investors or/and are already well-known on the market with already publicly existing beta versions at least. However, the Caspian project is different to projects mentioned in the competitive landscape section, as it is standalone software for a) execution of orders for crypto trades on 30+ exchanges b) a portfolio management system that normalizes data from all exchanges linked to it and provides real time visibility c) has a risk management module which provides warnings and alerts for users to prevent trader errors. Caspian helps crypto funds trade more effectively and is not intended for retail use in the same manner as Hashgard and Iconomi. Still, this market has large potential and taking into account the features proposed by Caspian in the case of their successful implementation, Caspian’s solution would be welcomed by investors looking for market change opportunities.

Medium/ Low

Team composition

The project website and whitepaper disclose only the management board. Links to their accounts are not provided. Regarding LinkedIn, none of the core team members has blockchain-related experience except Jehan Chu, who in turn is not affiliated with the project on LinkedIn. Another disadvantage is a lack of affiliation with the project for several team accounts and the lack of an account altogether for chairman Michael Lerch. The team composition is quite diverse, together with technical specialists in the blockchain area, there are team members with expensive experience in the financial area.

Considering the fact that there is already a live product in private version, the risk regarding team composition can be assessed as low.

Low

Token price decrease

Absence of vesting terms for the public sale and the fact that the lock-ups disclosed in the pre-sale sheet require further clarification, increases the risk of a token price decrease.

Medium

The information contained in the document is for informational purposes only. ICORating received monetary compensation in the amount of $15000 from the entity rated in this report for completing the ratings report. However, the entity rated in this report did not have the opportunity to approve this rating report before the report was published, nor did the rated entity have the opportunity to edit or remove this report once it was published. The views expressed in this document are solely those of the ICORating Team, based on data obtained 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.