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CINDX Rating Review

Stable

Investment Rating

Expiry date 25 Jan 2019 25 Oct 2018

Rating report

Based on the analysis performed and issues identified we have assigned the CINDX project a “Stable” rating. At the time of writing, the testnet (MVP) was already available, which is a possible indicator of the team’s serious intentions.

 

The project has the following strengths worth noting:

  • Availability of a testnet (MVP).
  • Participation in a significant, fast-growing market (the blockchain industry in general).
  • Highly skilled and vastly experienced founders, advisors and team.
  • An ambitious idea.      

 

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

Team composition risk

The developers are mostly young specialists, with no experience in the blockchain industry; the tech lead lacks work experience previous to the CINDX project according to the information obtained online. This could be a potential risk for the development process and the quality of the final product. Besides, we note that some members of the team do not state an affiliation to the project on their official LinkedIn profiles.

Non-comprehensive roadmap

A disadvantage of the roadmap is that it only covers the technical aspects of the project and does not lay out the business development process.

Non-comprehensive whitepaper

The whitepaper does not include competitor analysis, forecasts of marketing activities or plans for product promotion.

Token price decrease

We note that according to the project whitepaper, 6% of tokens will be allocated for a bounty campaign. Considering that 6% is half the amount of tokens allocated to the team and is a substantial amount of tokens, to be unlocked after 2 months, these factors may have an impact on the token price.

Based on the analysis performed and taking into consideration all of the risks associated with the CINDX project as of October 2018, we assign the CINDX project a “Stable” rating. This rating may need to be reassessed once further versions of the product are released and feedback on the first testnet is received.

Project & ICO information

CINDX is an ecosystem enabling any investor without specialized skills to securely trade crypto funds for a reasonable success fee, by choosing a manager for their portfolio. An investor can refer to transparent, verifiable statistics on traders and managers to find a suitable trading strategy. Such statistics include performance history, risk level and type of cryptocurrency.

Information regarding the CINDX token distribution can be found in the table below.

Website

Whitepaper

Medium

MVP (testnet)

Telegram

Twitter

Facebook

Bitcointalk

YouTube

GitHub

 

 

SALE

(PUBLIC SALE)

Start date

August 26th, 2018

October 8th, 2018

End date

October 7th, 2018

December 26th, 2018

Stage cap

No data

No data

Ticker

CINXO, CINX

Token

ERC-20

Token supply (for sale/total)

26,265,000 / 51,500,000

Soft cap

USD 3,800,000

Hard cap

USD 21,000,000

Estimated valuation at ICO price

USD 41,176,470

 

 

PRIVATE SALE

ICO (PUBLIC SALE)

Token price

USD 1 = 1CINX

USD 1 = 1CINX

Bonus

August 26th, 2018 - September 16th, 2018 - 25%,

September 17th, 2018 - October 7th, 2018 - 20%,

October 8th, 2018 - October 21th, 2018 - 17%,

October 22th, 2018 - November 4th, 2018 - 15%,

November 5th, 2018 - November 18th, 2018 - 13%,

November 19th, 2018 - December 2nd, 2018 - 10%,

December 3d, 2018 - December 16th, 2018 - 5%,

December 17th, 2018 - December 26th, 2018 - 0%.

Lock-ups

Team tokens are blocked for 1 year, with a release of 25% every quarter.

Bounty tokens are frozen for 2 months.

Reserve fund - tokens not sold in the token sale phase are frozen for 2 years with a 25%

unlock every 6 months.

Team tokens are blocked for 1 year with a release of 25% every quarter.

Bounty tokens are frozen for 2 months.

Reserve fund - tokens not sold in the token sale phase are frozen for 2 years with a 25%

unlock every 6 months.

Minimum investment

USD 50 (paid in an equivalent amount of BTC, ETH, BCH, LTC, USD or EUR)

USD 50 (paid in an equivalent amount of BTC, ETH, BCH, LTC, USD or EUR)

Maximum investment

Not specified

Not specified

Currencies accepted

BTC, ETH, BCH, LTC, USD, EUR.

Restricted list

Afghanistan, Angola, Antigua and Barbuda, Bahamas, Barbados, Belize, Bosnia and Herzegovina, Burundi, Central African Republic, Comoros, Republic of Congo, Côte d'Ivoire, Cuba, Dominican Republic, Ethiopia, Grenada, Guyana, Haiti, Iran, Iraq, Jamaica, Kongo, North Korea, Lebanon, Liberia, Libya, Macedonia, Mali, Marshall Islands, Mauritius, Myanmar, Rwanda, Saint Kitts and Nevis, Saint Lucia, Saint Vincent and the Grenadines, El Salvador, Serbia, Seychelles, Sierra Leone, Somalia, Sri Lanka, Sudan, Suriname, Syria, Tanzania, Trinidad and Tobago, Tunisia, Uganda, Vanuatu, Venezuela, Yemen, Zimbabwe.

 

KYC procedures

yes

Country of legislation

Estonia

         

 

CINDX is selling tokens valued at USD 21,000,000. All unsold tokens will be placed in a reserve fund. Moreover, CINDX provides bonuses for the token pre-sale (for a 25% bonus), and for the public sale (as presented in the table above).

During the token sale, investors purchase utility tokens – options called CINXO (with the same amounbt of emission - 26,265,000, as CINX), which confer the right to receive security tokens, CINX, in the future. A holder of CINXO tokens has the right but no obligation to exchange options for security tokens at a ratio of 1:1 after completing the KYC procedure.

 

CINX security tokens will be issued and distributed following the publication of the document ‘Prospect of Emission’ after the end of the token sale, but no later than Q1 2019, and CINXO will be burned after release of CINX security tokens.

 

All generated tokens will be distributed within the categories shown below. Tokens reserved for the team and advisors are vested for over a period of one year (The team plans to unlock 25% per quarter).

The team forecasts the use of proceeds from the ICO in Soft Cap and Hard Cap scenarios as follows:

The team’s and advisors’ tokens are locked for a year after the ICO.

 

We note that the intended distribution of funds is healthy, taking into account the project’s nature, its key features and current stage of development, with the exception of the fact that the team plans to allocate only 16% of proceeds in the Soft Cap scenario for Research and Development. This could create the additional risk that the final product will not be well-enough developed.

We believe that the whitepaper has the following issue:

  • Forecasts of marketing activities and plans for product promotion are not covered, so it is impossible to analyze or draw relevant conclusions regarding potential market exposure without such information.

Description of services and their applicability

CINDX is a platform based on smart contracts, includes APIs and the use of blockchain technology; it provides transparency, immutability, and censorship resistance for all information stored. All processes are thus transparent. The CINDX platform is extremely valuable for asset managers, who have an opportunity to attract more investors than is feasible outside of the ecosystem, which will be fully automated and secure.

The architecture of CINDX consists of:

  • CINDX.core.
  • CINDX.trade.
  • CINDX.market.
  • CINDX.hub.
  • CINDX.talk.
  • CINDX.dao.

 

CINDX.core consists of replication services, activity-tracking algorithms, a KYC/AML module, an API gateway for connection to exchanges and blockchain architecture services.

 

CINDX.trade includes a trading terminal and an internal marketplace where traders can source different products: Applications, scripts and analytics.

 

CINDX.market consists of a marketplace for investment products created by managers. It includes user dashboards for investors and managers, and billing options for contracts.

 

CINDX.hub includes an editor for trading strategies for algorithmic trading - which has the ability to commit tests using historical data, to audit code for placing products on the internal marketplace, as well as the vendor's dashboard.

 

CINDX.talk is a component giving any user the ability to post trading ideas, insights, signals, as well as useful content.

 

CINDX.dao is a system enabling a user to implement a voting system for the community based on decentralised autonomous organisation rules.

CINDX users will have the following roles and functions:

  • Trader
  • Investor
  • Vendor
  • Manager

 

A trader plays one of the key roles on the platform. He/she is linked to the trading terminal through the API to conduct trading decisions and strategies and has a personal dashboard with a personal blog, where he can share expert opinion.

An investor can choose and connect various financial products for managers (private traders, robots, funds) presented on the marketplace. The CINDX ecosystem automatically copies the actions of the manager selected, and replicates them on the investor's accounts.

A vendor distributes analytical and trading bots, tools for social network analytics and technical analysis.

Manager. A trader obtains the status of "Manager" to build an investor following on the marketplace.

The MVP testnet for the platform has already been launched and is available along with a demo version for testing on the website.  A full version of the platform, “CINDX live”, is planned to be launched by the end of 2020, when all components will be integrated in the platform.

Roadmap

The team has provided the following project and legal roadmaps:

The team plans to provide the final product, “CINDX live”, by the end of 2020, but a testnet was already available at the time of review (August 2018), so the risk for potential investors is reduced when compared to projects without an MVP before/during their ICO.

A disadvantage of this roadmap is that it only covers technical aspects of the project, and does not lay out the business development process – e.g. when and how marketing activities will be performed.

Market outlook

Cryptocurrency users generally buy their crypto through an exchange. The transaction process usually starts with fiat to Bitcoin conversion. Then the Bitcoin can be traded for other crypto assets, which often requires sending it to a different exchange, incurring multiple commission payments. CINDX is offering users a chance to enter the cryptocurrency market, and access a variety of services, including crypto asset management. CINDX customers can use their crypto assets to generate additional income within a single ecosystem for a reasonable success fee. We have prepared the following summary table:

Industry rivalry:

 

     

Ticker

CINDX

MDX

TDZ

Key functions/
features

Proof of Data Authenticity and Provenance, Constellations for Disparate Data Sources, Fair Remuneration and Incentive Sharing.

Open asset exchange and financial platform.

Ecosystem where pro traders gain a unique trading toolset and investors achieve investment results equal to those of the best ProTraders

Key users

Developers, enterprises, consumers, vendors and security experts.

Businesses, traders, and consumers.

Traders and Investors.

Key products

Data Stamping Protocol, Stamp Verification, Open Constellations, Network Nodes and Clients, Data Enhancement by Elons, Public Chain Anchors.

Cryptocurrency financial platform, unified asset management center, connection of external accounts, aggregator of exchange quotations

Tradelize Terminal, Web and App.

Development stage

Testnet released.

Under development.

Trading terminal demo launched.

ICO status

Main sale ongoing.

Ended.

Ended.

Funds collected as of ICO date/Hard cap

Unknown/ USD 3.8m

USD 21m / USD 21m

Unknown / USD 21m

Percentage of tokens for sale

40%

85%

70%

Valuation on date of ICO

USD 50m

USD 25.88m

USD 42.857m

Market capitalization

N/A

N/A

N/A

 

We should note here that there is still one issue with the whitepaper:

  • The absence of any deep competitor analysis.

Team

CINDX is a blockchain ecosystem for investors, traders, asset managers and vendors. It appears to be technically complex. If the testnet was not yet released, we would have doubted the sufficiency of the project team’s experience, as illustrated in the table below:

Yuriy Avdeev

Position

CEO

Total experience

8+ years

Relevant experience

Yes

Relevant education

Yes (Open University Business school)

Professional achievements

Co-founder of CryptoActive, Method Delphi investment company, EcoViileTrade Ltd.

LinkedIn

Yes

Connections

500+

Endorsements / Recommendations

Yes

 

Val Jerdes

Position

Product Director

Total experience

20+ years

Relevant experience

Yes

Relevant education

Yes

Professional achievements

Co-founder of Streamlogic

LinkedIn

Yes

Connections

500+

Endorsements / Recommendations

Yes

 

Mofassair Hossain

Position

CMO

Total experience

4+ years

Relevant experience

Yes

Relevant education

Yes (Chartered Institute of Management Accountants)

Professional achievements

Certified Member of Malta Blockchain Association, top expert at ICOBench

LinkedIn

Yes

Connections

500+

Endorsements / Recommendations

Yes

 

Artur Shamalov

Position

Investment Director

Total experience

2 years

Relevant experience

Yes

Relevant education

No (Leningrad State University named after A.S. Pushkin)

Professional achievements

Private investor and Co-founder of several companies

LinkedIn

Yes

Connections

500+

Endorsements / Recommendations

Yes

 

Denis Eskenazi

Position

Product Marketing Director

Total experience

10+ years

Relevant experience

Yes

Relevant education

Yes (St.Petersburg State University of Economics and Finance)

Professional achievements

Co-founder of Storypointer and startup Drop Up

LinkedIn

Yes

Connections

500+

Endorsements / Recommendations

Yes

 

Ibragim Haniev

 

Position

Tech Lead

Total experience

2+ years

Relevant experience

No

Relevant education

Yes (Pyatigorsk State University)

Professional achievements

-

LinkedIn

Yes

Connections

500+

Endorsements / Recommendations

Yes

     

The CINDX project team also involves the following members: Airat Shayhulov (Head of Quantitative Research), Sofja Pevzner (Personal Data Officer) and Jelena Karzetskaja (Compliance Advisor).

The project has a strong team; all the members can be contacted via social networks. The developers are mostly young specialists with no experience in the blockchain industry; the tech lead lacks work experience before the CINDX project, according to information obtained from social pages. This could be a potential risk for the development process and the quality of the final product. Besides, we note that some members of the team (Sofja Pevzner and Jelena Karzetskaja) do not state their affiliation with the project on their official LinkedIn profiles.

CINDX is supported by the following advisors: Keith Teare, Austin Kimm, Philip Staehelin, Amarpreet Singh, Motti Peer, Tyler Sanford, Bogdan Fiedur, Graham Doggart, Leonard Grayver, Jason King and Sadie Hutton. All advisors are highly experienced professionals in blockchain and consulting, business development, finance and investing. It should be noted here that Amarpreet Singh, Motti Peer and Leonard Grayver do not refer to the CINDX platform on their LinkedIn pages.

On the project website CINDX lists the following partners: TopICOList, Greenberg Whitcombe, Blonde 2.0, Yellow Door, Innov8 Global Advisery, Progressor, ICO Promo, Sum&Substance, Twiga Communication Group and TradingView. There is no information about what kinds of partnership they have with each of these companies.

Token analytics

CINX token is the security token of the CINDX platform. The emission of CINX is limited to 51,500,000 tokens; additional issuance is prohibited.

It is designed to enable users:

  • to pay for services within the ecosystem
  • to participate in revenue distribution with the bonus program lock-up and enable voting on the platform
  • to receive rewards for freezing tokens using smart contracts.

All investment and processing operations within the CINDX ecosystem will be implemented strictly in CINX tokens, whereas success fees can be paid either in CINX tokens or other cryptocurrencies.

For holders who “lock” their tokens in the platform with a smart contract, the CINDX project proposes a loyalty program. This is aimed at encouraging users to save their tokens in their portfolio; 30% of the revenue generated in CINX tokens will be distributed to a such holders.

Token price factor analysis

FACTOR DESCRIPTION

 

Development and release of new products according to the roadmap

The MVP (testnet) has already been released (on August 30th). A full version of the product will be released by the end of 2020. Whether or not the team meets this milestone, and the degree of product development at each stage, will drive the token price up or down.

⬆︎⬇︎

Demand for the platform

At the time of analysis (October 2018) it is hard to predict demand for the platform, as it is not due to be released until 2020.

⬆︎⬇︎

Sales of tokens by the team, crowd-sale, etc.

Since 12% of tokens may be unlocked during the 1st year after the ICO, there is a risk that the team will trade them in.

⬆︎⬇︎⬇︎

Sales of tokens by private sale investors

Assuming that USD 3,800,000 has been raised during the private sale, there is some risk that when the token appears on exchanges, investors in the pre-sale will want to sell their tokens.

⬇︎  

Limited token supply

Assuming that the company develops as intended and demand for the solution is sufficient, a limited token supply could have an impact on the token price in the long-term.

⬆︎

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 to trade CINX, which may lead to price fluctuations for the token or even speculative activities (pump & dump, etc.).

⬆︎⬇︎

Investment risk analysis

RISK DESCRIPTION LEVEL

Team composition risk

The developers are mostly young specialists with no experience in the blockchain industry, and the lead developer lacks experience before CINDX, as previously noted. This could be a potential risk for the development process and the quality of the final product. Some members of the team do not state their affiliation to the project on their official LinkedIn profiles.

Medium

Incomprehensive whitepaper

We believe that the whitepaper has the following issues:

  • Absence of deep competitor analysis.
  • Forecasts of marketing activities and plans for product promotion are not covered in the whitepaper; it is impossible to analyze or draw relevant conclusions regarding potential market exposure without them.

Low

 

Incomprehensive roadmap

The roadmap only covers technical aspects of the project and does not lay out the business development process.

Medium

 

Token price decrease

We note that according to the project whitepaper, 6% of tokens will be allocated to the bounty campaign. Considering that 6% is half the amount allocated to the team, a substantial amount of tokens that will be unlocked after 2 months, this might have an impact on the token’s price.

Medium

The information contained in the document is for informational purposes only. ICORating received monetary compensation in the amount of $20000 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.