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DUO Network Rating Review

Stable

Investment Rating

Expiry date 06 Nov 2018 06 Aug 2018

Based on the analysis performed and issues identified, we decided to give DUO Network a “Stable” rating.

By using DUO Network, traders can split their risky cryptocurrency assets and receive both a fixed and a speculative income.

The project has the following strengths:

  • The description of the product and its features in whitepaper is quite comprehensive.

  • Possibility of collateralized assets being extended from ether to any ERC-20 token and the price feed coming from any trading pair.

  • The launch of two demo dApps and the availability of smart contracts, follows/corresponds/complies with the project’s roadmap.

  • Competitive products are highly appreciated by the community, which shows that there is a demand for new solutions from the market.
    However, there is also a number of significant risks linked/attached to the project:

  • ICO details such as the distribution of tokens between the private sale and the crowdsale, vesting periods and the token price had not been released at the time of writing (mid-July 2018), despite the private sale being due to start in July.

  • The long-term development of the project, in terms of business operations and product development, is not covered in the roadmap.

  • The liquidity of the project, with its dual-token platform, could be negatively affected since speculators may prefer to withdraw any underlying assets in case of token price growth.

  • The absence of a budget plan and no announced Hard Cap shows a lack of clarity in the project’s economy.

  • The absence of partnerships could affect the community’s interest in the project.

Presence of fundamental factors which can put pressure on the token price in the long run.

DUO is a new, decentralized, income-generating stable token backed by first-class financial engineering and a market proven model.

KEY FEATURES

  • Platform:

  • Date founded:

  • Parent company: FinBook is a startup company which focuses on cloud-based portfolio analysis solutions. It has already announced two projects, DUO Network and CoinFront.

  • Location: Singapore

  • Restricted countries: N/A

  • Website

  • Economic Whitepaper

  • Academic Whitepaper

  • Technical Whitepaper

  • MVP: Demo is available.

  • GitHub: Smart contract is available, but the contract code is not.

  • KYC: Due to be announced by the end of July 2018.

  • Founders: Jerry Li, Yizhou Cao and Guojie Liu.

  • Team: 9 members, including back-office specialists.

  • Advisors: 2 advisors from the academic community.

  • Investors: 7 firms, including venture funds, research foundations and lending companies.

  • Community: ~3,500 Telegram, <300 Twitter, <100 Medium.
    Telegram
    Medium
    Twitter

  • Partners: No announced partnerships.

According to information from the project team, DUO is planning to conduct its ICO in July-September 2018, according to the following scheme:


 

 

               PRIVATE SALE

ICO (PUBLIC SALE)

Start date

July 2018

September 2018

End date

Token

DUO

Token distribution

40,000,000

Total Volume of Tokens

100,000,000

Soft Cap

N/A

Hard Cap

N/A

Exchange Rate

1ETH: 1,000 DUO

 

1ETH: 800 DUO

   

Bonus Ratio

25%

 

no

   

Currencies accepted

                  ETH, maybe BTC in the private sale.

   

Restricted list

          N/A

   

KYC procedures

             Due to be announced by end of July 2018.

   

 

The planned distribution of the 100,000,000 tokens is as follows:

According to information from the project team, shares belonging to the Team and the Operation and Community reserves will have a lock-up period of 2 years.
The budget plan is not disclosed.

The following investors have already shown interest in the project:

  • ZhenFund: ZhenFund is a seed stage focused venture fund, founded in 2011 by Bob Xu and Victor Wang in collaboration with Sequoia Capital China. Its portfolio has over 150 high-growth companies, including 17zuoye, OFO, VIPKID, RED, Hero Entertainment, and UrWork.

  • LD Capital: LD Capital is one of Asia's earliest organizations focusing on the value of investing in the blockchain field.

  • Node Capital: A venture capital company focusing on the blockchain industry. Node Capital has already invested in projects such as Huobi, Coldlar, Bocheninc, fengwo, Jinse Finance, Lianshang Technology, Yulian, Qukuai Leida.

  • Lemniscap: Lemniscap is an early stage investment and advisory firm specializing in investments in emerging crypto assets and advising blockchain startups.

  • Blocksauce Foundation: They have recently rebranded to Taureon – they are a due diligence and research foundation.

  • UniValues Associates: No site or public data available.

  • Homerun Capital: A lending firm.

However, there is no information about partnership.

SUMMARY: Although the idea and features of DUO Network are fully disclosed in the whitepaper and the project is presented on the main community channels, there is a lack of information regarding the ICO. Additionally, there is no information on the budget plan, which makes the project’s economy look unclear. The project has already attracted interest from several investors. But there is a lack of information available on these companies and no information on seed funding, which makes it hard to evaluate the level of interest from these companies. Currently the DUO community is quite small, but according to the team, a bounty program to expand the Telegram and WeChat groups is planned.

DUO is a dual-class token structure that, combined with the smart contract governed rules and the market arbitrage mechanism, provides principal-guaranteed fixed incomes and leveraged capital gains for holders of each class, respectively.

The project suggests the following token structure:

The initial or underlying token is a basic crypto asset. In the majority of cases it combines two functions, such as a network fuel or medium of exchange, which requires short-term value stability, and a digital asset that can be traded for speculations. ETH could be a good example here.

Token A is an income token, that continuously accumulates interests based on its original net value at the last Reset event. This token receives payments at each Reset event.

Token B is a leverage token, that entitles leveraged participation of the underlying digital assets.

Interaction between tokens occurs through a custodian smart contract, Beethoven, that will retain ether’s value but transfer volatility from risk avoiders to risk seekers.

The custodian smart contract, Beethoven, performs multiple tasks, such as:

  • The creation and redemption of Tranche tokens:

Tranche tokens (A and B) are created and reverted through Beethoven, at a ratio of 1:1. This split structure means that the holder of Token B borrows capital from the holder of Token A and makes investments in a volatile cryptocurrency.

Deposited initial tokens (ETH) are kept as collateral, which any user can verify.

Deposited initial tokens can be withdrawn at any time, by sending an equal amount of tranche tokens to Beethoven.

For example, a deposit of ETH, at a price of $1,000, will create 500 Token A and 500 Token B. Token A will have a fixed annual return, linked to USD, let’s assume 12% annually. Token B will receive all ETH price returns and pay Token A’s fixed returns.

  1. ETH/USD price increases from $1,000 to $1,200 (+ $200) in 3 months, 20% growth:

           Token A receives 500 × (12%/12×3) = 15, 3% growth.

           Token B receives 200 – 15 = 185, 37% growth.

       2. ETH/USD price decreases from $1,000 to $900 (- $100) in 3 months, 10% fall:

           Token A receives 500 × (12%/12×3) = 15, 3% growth.

           Token B receives -100 – 15 = -115, 23% fall.

       3. ETH/USD price remains at $1,000 (flat) in 3 months, 0% growth/fall:

           Token A receives 500 × (12%/12×3) = 15, 3% growth.

           Token B receives 0 – 15 = -15, 3% fall.

DUO is a dual-class token structure that, combined with the smart contract governed rules and the market arbitrage mechanism, provides principal-guaranteed fixed incomes and leveraged capital gains for holders of each class, respectively.

The project suggests the following token structure:

The initial or underlying token is a basic crypto asset. In the majority of cases it combines two functions, such as a network fuel or medium of exchange, which requires short-term value stability, and a digital asset that can be traded for speculations. ETH could be a good example here.

Token A is an income token, that continuously accumulates interests based on its original net value at the last Reset event. This token receives payments at each Reset event.

Token B is a leverage token, that entitles leveraged participation of the underlying digital assets.

Interaction between tokens occurs through a custodian smart contract, Beethoven, that will retain ether’s value but transfer volatility from risk avoiders to risk seekers.

The custodian smart contract, Beethoven, performs multiple tasks, such as:

  • The creation and redemption of Tranche tokens:

Tranche tokens (A and B) are created and reverted through Beethoven, at a ratio of 1:1. This split structure means that the holder of Token B borrows capital from the holder of Token A and makes investments in a volatile cryptocurrency.

Deposited initial tokens (ETH) are kept as collateral, which any user can verify.

Deposited initial tokens can be withdrawn at any time, by sending an equal amount of tranche tokens to Beethoven.

For example, a deposit of ETH, at a price of $1,000, will create 500 Token A and 500 Token B. Token A will have a fixed annual return, linked to USD, let’s assume 12% annually. Token B will receive all ETH price returns and pay Token A’s fixed returns.

         4. ETH/USD price increases from $1,000 to $1,200 (+ $200) in 3 months, 20% growth:

            Token A receives 500 × (12%/12×3) = 15, 3% growth.

            Token B receives 200 – 15 = 185, 37% growth.

          5. ETH/USD price decreases from $1,000 to $900 (- $100) in 3 months, 10% fall:

             Token A receives 500 × (12%/12×3) = 15, 3% growth.

             Token B receives -100 – 15 = -115, 23% fall.

         6. ETH/USD price remains at $1,000 (flat) in 3 months, 0% growth/fall:

             Token A receives 500 × (12%/12×3) = 15, 3% growth.

             Token B receives 0 – 15 = -15, 3% fall.

From a technical point of view, DUO Network consists of the following parts:

  • The smart contract built on Ethereum blockchain.

  • The price feed, which is set up independently on AWS, Azure and GCP.

  • The Reset event trigger, that runs on cloud servers and web-user interface.

As of mid-July 2018, the project had already released two dApps:

  • The demo version of the product that relies on the historical data of ETH.

  • The testnet released on Kovan net. Price conversions are taken from the Bitfinex, Kraken, Geminin and GDAX exchanges. According to the team more exchanges will be added in the future.

At the beginning of July 2018 public testing was launched on Kovan. Participants will receive rewards for actively creating and redeeming tokens

Both dApps are based on the TypeScript language, originated from the perceived shortcomings of JavaScript for the development of large-scale applications. Applications work as stated in the technical whitepaper.

Auxiliary tools for their applications are available on GitHub as well. The features of these tools include cooperation with smart contracts on trading, cooperation with exchanges and recording of completed transactions.

All announced milestones regarding product development have been met.

SUMMARY: The development of the project has been carried out in accordance with the roadmap. As of mid-July 2018, an MVP in the form of two demo dApps is available. All components work well and the smart contracts are available on GitHub, but unfortunately the smart contract code is hidden and can’t be verified. However, an independent audit for each of the smart contracts is due to be carried out and the information from them will be available to the community.

The roadmap describes main milestones for of 2018 year.  

SUMMARY: The roadmap provides a short overview of the on planned activities for the current calendar year. At the time of the review (mid-July 2018), all announced activities. All announced activities as of mid of July 2018 are have been fulfilled, including the implementation of the demo dApps. However,But there is a lack of information regarding upcoming the activities after the ICO, including business operations and further development.

The cryptocurrency market, in general, is far from stable. Over the 7 past month the total market capitalization fluctuated from $240 million to $830 million.

Volatility and risk are the primary reasons why more conservative investors are not interested in the cryptocurrency market.

Stable coins could be a way to strengthen the commercial case of blockchain for these investors. Without being regulated by a third party (like the government or some other central institution) while also being somewhat stable in price at the same time. It is a store of value but also an asset, a payment medium, with traits similar to those of gold or USD.

Stable coins are engineered to adjust their supply as the market shifts, issuing when prices rise and retracting when they drop, in an effort to keep their prices steady.

Below is a comparison of DUO Network with other stable coin solutions.

PROJECT

DUO NETWORK

TETHER

MAKERDAO

DIGIXDAO

Fee structure

Fees:

- not specified.

Fees:

- sending between Tether wallets is free.

- $25 withdrawal fee from exchanges.

- almost zero conversion fees.

Fees:

- stability fee.

- fees accrued on CDPs that have been used to generate Dai in the Maker system. Once the fees are paid, the MKR is burned.

Fees:

- storage fee - $5 per year.

- transaction fee - 0.13%.

Features

- Dual-token platform.

- Split of initial token into 2 tranche tokens.

- Fixed and leveraged income.

- Convert digital currency into conventional currencies like Dollar, Yen and Euro.

- Backed by USD (1 USDT by 1USD).

- Consists of a stable coin - Dai which is pegged to $1 USD and a utility and governance token - MKR, which backs the value of Dai.

- Dai tokens can be created by borrowing or leveraging: collateral tokens (ETH) should be locked in CDP. - Collateralized Debt Position (CDP). An owner of the CDP can borrow Dai up to a collateralization ratio of 150%. The borrower sells Dai on an exchange and the proceeds are transferred to the owner of the CDP. To get ETH collateral back, the user must return the same amount of Dai and pay a fee to the MKR token holders for system stabilization.

- Platform for trading gold-backed tokens.

- Rewards in DGX for voting and decision making in the growth of DigixDAO. DGX represents 1 gram of gold.

- Gold reserves are stored in Singapore.

Token

DUO

USDT

MKR / Dai

DGX / DGD

Platform

Ethereum

Omni

Ethereum

Ethereum

Total supply

100,000,000

3,100,000,000

1,000,000

2,000,000

ICO price / Market price

N/A

$1.26 (02'2015) / $0.99

Dai: ~$1

MKR: - / $556.73

DGD: $4.2 / $92.50

DGX: - / $41.24

ICO date

July-August 2018

No ICO, issued in 2014

No ICO

March 29th- 30th, 2016

Hard cap / Market cap

N/A / -

- / $2,702,340,586

Dai: - / $54,016,051

MKR: - / $372,021,778

DGD: $5,500,000 (raised) / $185, 008,800

DGX: - / $1,760,449

Benefits for token holders

- Mining rewards for participation in conversion arbitrage.

- Discount scheme for fees, paid in DUO.

- Buy-back mechanism, up to 50 million tokens.

- Stability, price doesn't fall lower than $1.

- Buy back mechanism.

- No centralized authority like Tether that backs its value.

- All of the fees collected from buying/selling and storing DGX will be distributed amongst the DGD holders.

Upsides

- Demo dApps.

- Conversion arbitrage.

- Extension to any ERC-20 token and price feed from any trading pair.

- Conversion arbitrage.

- 10th largest cryptocurrency, as of the end of June 2018.

- Integration with wallets, exchanges and companies.

- Decentralized.

- Plans to launch an exchange to conduct margin trade.

- Project is backed by the Ethereum Foundation.

- Easier for anyone to own gold, even if it is just a few grams.

- Relatively stable political environment in Singapore.

Downsides

- No ICO details.

- No smart contract code.

- Audited just once in June 2018, but not in accordance with GAAP.

- Lack of information related to the history of Tether available on the net.

- Centralized: system depends on Tether’s capability and willingness to maintain the currency peg.

- Over-collateralized loan margins due to the 150% collateralization ratio.

- Profitable only in the case of an increase in the collateral token price (please refer to example below).

- Gold standards already showed their weakness at the end of XX century.

- Tied to ETH due to the large supply of ETH DigixDAO holds - DigixDAO holds 466,648 ETH which equates to just under 0.5% of the total Ether supply.

 

Since the MakerDAO mechanism is not easy to understand, perhaps it can be better explained by examples of the two possible incentives of Dai:

  • Borrowing — If a user has a $1,000 credit card bill due, but doesn’t get paid till the end of the month. By locking $1,500 worth of ETH, a user can borrow 1,000 Dai, convert it to whatever currency is needed and pay the bill. Upon being paid at the end of the month a user can return the Dai, pay the stability fee and retrieve their ETH.

  • Leveraging — If a user owns ETH and thinks the price is going to increase, they could lock $1,500 worth of ETH into a CDP and use the Dai to purchase another $1,000 worth of ETH. This will cause an increase the exposure of ETH to 1.66x.

If the price of ETH goes up to $2,000, the user’s position in ETH would be worth $3,320. Once the $1,000 Dai debt is paid, $2,320 net revenue is received.

But if the price of ETH goes down to $1,000, the user would have to pay off the $1,000 Dai debt, and the incurred loss would be $840. As a result, the user would get $660 of ETH back. This loss is much larger than if the user didn’t borrow Dai.

From the comparison above it follows that Tether is apart from other three. It is more of a conversion platform than a passive income solution.

Like MakerDAO and DigixDAO, DUO Network proposes a dual-token platform with one stable token and one leveraged token. The main difference being that the stable coin (fixed token in DUO Network) could yield a passive income.

It is worth mentioning that there is an increasing number of decentralized apps (dApps), within stable coin solutions, that rely on ether and other internal crypto tokens dependent on ether, as a way to distribute value. As a result, unpredictable market shifts in the price of ether could cause chaos in the system.

DApp users would be less likely to convert their tokens into internal crypto tokens, if they believed their value might double overnight. If users suspect that the value of the dApp tokens will plummet, it may discourage them from participating at all.

As of mid-2018, stable coins represented only 1% of the current cryptomarket, where the share of Tether is almost 99%.

SUMMARY: Stable coin solutions are an attractive instrument to involve more conservative investors into blockchain, by strengthening the use case for cryptocurrencies by serving as a non-volatile tool. Based on the history of already existing solutions, such as Tether, MakerDAO and DigixDAO, it is possible to assume that DUO Network could have a short or medium-term success. As it relies on Ethereum, like MakerDAO and DigixDAO, the further success of the solution will depend on the volatility of this underlying token.

Team:

 

Jerry Li

               

Position

Co-Founder & CEO

Total experience

7 years

Relevant experience

Finance

Previous experience (positions) - years

CEO & Founder of FinBook (financial engineering on blockchain) – 07.2017 – Present.
AVP at SS&C Technologies ) – 03.2016 – 07.2017.

Professional
achievements

N/A

LinkedIn

Yes

Connections

500+

Endorsements /
Recommendations

Yes

 

Yizhou Cao

               

Position

Co-Founder & CTO

Total experience

9 years

Relevant experience

Finance

Previous experience (positions) - years

CTO & Co-Founder OF FinBook (financial engineering on blockchain) – 11.2017 – Present.
Associate at Nomura (proprietary trading) – 05.2014 – 09.2016.

Professional
achievements

Certificate in Functional Programming Principles in Scala.

LinkedIn

Yes

Connections

40+

Endorsements /
Recommendations

Yes

 

Guojie Liu

               

Position

Investor Relationship

Total experience

8 years

Relevant experience

Investment & Blockchain

Previous experience (positions) - years

Managing Director of BiBox (CEX) – 06.2018 – Present.
Asset Manager at BlackRock – 05.2015 – 06.2018.

Professional
achievements

Awards:
- PEB Gold Medal, Continental Gold Medal, Ssangyong Cement Medal, TUCSS Geotechnical Award and RICS Prize 2012 UK.

LinkedIn

Yes

Connections

500+

Endorsements /
Recommendations

Yes

 

Tony Ren

               

Position

Blockchain Architect

Total experience

6 years

Relevant experience

Engineering

Previous experience (positions) - years

Blockchain Architect at FinBook – 03.2018 – Present.
Cloud Architect at Accenture (IT consulting and solutions) – 12.2017 – Present..

Professional
achievements

Several certificates related to Development, such as:
-AWS Certified Developer Associate CISSP,
-AWS Certified Solutions Architect Associate,
-MCSE: Cloud Platform and Infrastructure, etc.

LinkedIn

Yes

Connections

300+

Endorsements /
Recommendations

Yes

 

Lino Wang

               

Position

Marketing

Total experience

7 years

Relevant experience

Marketing

Previous experience (positions) - years

Head of Marketing at FinBook – 02.2018 – Present.
Marketing Analyst at ZhenFund – 02.2017 – 02.2018.

Professional
achievements

N/A

LinkedIn

Yes

Connections

100+

Endorsements /
Recommendations

Yes

 

Weitao Yang

               

Position

Blockchain & Data Engineer

Total experience

3 years

Relevant experience

Consulting

Previous experience (positions) - years

Blockchain &Data Engineer at FinBook – 11.2017 – Present.
Business & Data Analyst at Deloitte – 082016 – 11.2017.

Professional
achievements

Certificates in Text Mining & Analytics and Data Visualization.

LinkedIn

Yes

Connections

400+

Endorsements /
Recommendations

Yes

 

Xiaobo Weng

 

Position

Financial Engineer

Total experience

7 years

Relevant experience

Finance

Previous experience (positions) - years

Product Analysis and Design Principal at IHS Markit Technology (data and information services business) – 08.2016 – 06.2018

Professional
achievements

Certificates in CFA level 3 and FRM levels 1 & 2

LinkedIn

Yes

Connections

500+

Endorsements /
Recommendations

Yes

 

Sihao Wen

 

Position

Front-End Designer & Engineer

Total experience

3 years

Relevant experience

Engineering

Previous experience (positions) - years

Front-end Designer & Developer at FinBook – 11.2017 – Present.
Front-end designer at Risewinter Technology – 07.2016 – 04.2017

Professional
achievements

N/A

LinkedIn

Yes

Connections

100+

Endorsements /
Recommendations

Yes

 

Wenjing Zhang

 

Position

Financial Engineer

Total experience

6 years

Relevant experience

Finance

Previous experience (positions) - years

Securities Services Management Associate at HSBC – 07.2015- 04.2017

Professional
achievements

N/A

LinkedIn

Yes

Connections

500+

Endorsements /
Recommendations

Yes

 

Advisors:

Steven Kou

 

Position

Director of the Risk Management Institute, Singapore

Total experience

23 years

Relevant experience

Mathematics

Previous experience (positions) - years

Director of the Risk Management Institute, Singapore – N/A.
Professor of Mathematics at National University of Singapore – 07.2016 – Present

Professional
achievements

Grants from several programs:
-Computational Mathematics Program.
- Service Enterprise Engineering Operation, etc.

LinkedIn

No

Connections

N/A

Endorsements /
Recommendations

N/A

 

Min Dai

 

Position

Professor

Total experience

N/A

Relevant experience

Mathematics

Previous experience (positions) - years

Director, Centre for Quantitative Finance – N/A.
Deputy Director, Risk Management Institute – N/A

Professional
achievements

N/A

LinkedIn

No

Connections

N/A

Endorsements /
Recommendations

N/A

SUMMARY: There are 9 team members, including 2 Co-Founders. The majority of them are currently a part of the FinBook company. FinBook is a startup company focusing on cloud-based portfolio analysis solutions, DUO Network is one of its projects. Although there are back-office specialists, there seems to be a lack of developers and engineers. It is worth to noting that one team member does not list their affiliation with the project on their LinkedIn profile.

There are only 2 advisors to the project and they both have no direct experience in blockchain or ICOs.

The core of the platform is the DUO token, issued on the Ethereum platform.

The token’s utility is described as follows:

  • Mining rewards for participation in conversion arbitrage, helps to stabilize the token price. The reward share had not yet been announced, as of mid-July 2018.

  • Paying fees for token conversion (can be paid in ETH or DUO). During the early stages a discount scheme will be applied to fees paid in DUO. A buy-back mechanism is also planned, 50% of the total issued tokens will be burned.

Conversion fees paid in ETH will be used to maintain the daily operation of the Network (pricing feeds, oracles, gas fuels and personnel expenses). It is assumed that the excess proceeds will be reserved to improve the price stabilization, liquidity and market awareness of DUO Network.

Income from the custodian smart contract, Beethoven, will belong to the DUO Network community. The role of the community is not obvious.

SUMMARY: The whitepaper discloses the main features of the DUO token, including the functions of tranche tokens in smart contracts. It is assumed that fees can be paid in ETH as well, so the need for DUO tokens is not obvious. Details on the use of proceeds are also unclear.

Once a full description of the project is released, all factors may need to be re-evaluated:

FACTOR

DESCRIPTION

PRICE EFFECT

Development and release of new products according to the roadmap

Although the roadmap is quite vague, all announcements related to product development have been implemented. As of mid-July, the project had released two demo dApps.

Bullish

Token distribution

The distribution proposal includes a lockup period for the Team & Early Investors and the Operation and Community Reserves - 60% of token distribution – a vesting period of up to 2 years, according to the e-mail confirmation received from the project team. However, the split between the team and early investors is not disclosed, so it is impossible to evaluate the amount of seed funding received and tokens awarded.

Bearish

Demand for the platform

There are several competitive solutions within the stable coin market. All of them could be described as having in short and mid-term prospects, but demand for the platform would depend on the volatility of the underlying token (ETH in most cases).

Bullish / Bearish

Competitors

Several similar solutions have already entered the market and been accepted by the community. Taking into account that the current market cap of Dai (MakerDAO) is ~ $51 million and DGD (DigixDAO) is ~ $185 million, the probable Hard Cap of DUO could be ~ $25 million, there is an opportunity for growth. [MS1]

Bullish

Volatility of the cryptomarket

Tokens can be used as an internal payment mechanism, however, due to the high volatility of the crypto markets the token price could fluctuate or even be subject to speculative activities (pump and dump etc.).

Bullish / Bearish

SUMMARY: The token price analysis highlighted the potential risks for token price stability due to token price volatility. It should be noted that this factor also affects similar solutions and could be eliminated in the near future.

Based on the analysis performed, the following risks were identified:

RISK

DESCRIPTION

LEVEL

ICO details

The ICO details are not disclosed on the project’s website. There is a lack of clarity on the split of token distribution between the private sale and the crowdsale. The lack of information is a red flag because of the 25% bonus ratio for the private sale. The private sale was scheduled for July 2018, but as of mid-July 2018 there was no whitelist. Also it is worth noting that the vesting period, as well as the token price were confirmed via e-mail and are not publicly disclosed.

Medium / High

Roadmap

The roadmap is very limited, with only the main milestones until September 2018 being covered. The launch of the mainnet one month after ICO may indicate either that the product is almost developed (then only minimum investments are required) or that there is a lack of clarity and organization in terms of product development. There is also no information on the planned business operations and further development[MS1] . However, it should be mentioned that all activities, related to the product launch have been carried out.

Medium / High

Liquidity

DUO proposes a dual-token platform, where one token is aimed to generate leveraged income. Speculators may prefer to withdraw any underlying assets in case of a token price increase, which would affect the project's liquidity.

Medium

Token economy

The absence of a budget plan and hard cap illustrates a lack of clarity in the project's economy. There is also a lack of justification for the DUO token within the platform.

Medium

Partnerships

As of mid-July 2018, there were no announced partners (exchanges, audit companies, etc.). The absence of partnerships could affect the community’s interest in the project.

Medium

Competitors

DUO Network proposes a dual-token platform, similar solutions have already been implemented by MakerDAO and DigixDAO. Both solutions are backed by a stable coin and offer leveraged income. In both the short and medium-term they showed increase in the marker cap and received acceptance from the community. The upside to DUO is the opportunity to receive a fixed income from the so-called stable coin, which makes the DUO solution look more competitive in the short-term. However, all such solutions depend heavily on the volatility of the underlying asset, which can affect token price.

Medium

Team & advisors

The team appears to be quite localized. The majority of the team are also members of the parent company - FinBook, which also has one other project. It is also worth mentioning that one team member doesn’t list their connection the project on their LinkedIn profile. The project has only two advisors from the academic community with no experience in blockchain or ICOs.

Low

SUMMARY: The main risks for the project are related to the disclosure of information about the ICO, token economy and project development. The project will probably publish more details before the crowdsale.

 

 

The information contained in the document is for informational purposes only. The views expressed 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.