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FSBT Technologies Rating Review


Investment Rating

Expiry date : Expired 30 Jul 2018


We have reviewed project's progress as of December 2018 and indentified that the legal risks related to the token legislation appeared for the project, as the project's token has security token features. The project's GitHub is unavailable. We also note, that the team still intends to obtain necessary licences, the only information which is currently available is that the team has already requested the banking license and waits for the response, as one of the project's competitors, Revolut, provider of a mobile finance app that offers crypto trading, has been granted a banking license from the European Central Bank (https://www.coindesk.com/crypto-friendly-money-app-revolut-wins-eu-banking-license). Taking into account all the abovementioned information, investment score has been decreased to "Risky+"

We assign the Forty Seven Bank project a “Risky+” rating. This project is a startup in the financial technology field, targeted at a specific milestone for the banking sector, and therefore we recommend participants consider all risks inherent in this sector.

The Forty Seven Bank project is entering a promising and fast-growing market. After the adoption of the new PSD2 Directive, opportunities for the creation and development of such banks are opening, and in the near future these new banks will be able to compete with established ones.

We commend the high-quality preparation of the documentation for the upcoming ICO and the quality of the interaction with the community. In the communication process we formed a positive impression of the management; we received comprehensive answers to questions concerning all stakeholders of the Forty Seven project.

We believe that important issues such as consistency in the development plans and clear timetables for their implementation characterize the founders as serious in their intent.

However, we also note a number of risks inherent in the project.

This activity is subject to licensing and monitoring by the regulator. The creation of such a business involves constant compliance with all standards, requirements and regulations, as well as a number of conditions required for obtaining a banking license. We note this as a risk for the entire sector; further business development will be possible only after licensing.

In addition, there is growing competition in this market. The introduction of new technologies is widespread, and in this case use of blockchain will enable the project to buy some time and to occupy a market share. However, major players are aware of all the trends in financial technologies and will be implementing similar services for their customers. However, there is a certain inertia in large companies regarding the introduction of new technologies and procedures. A new player in the market is always more flexible, and clearly lacks any legacy solutions that need to be maintained.

This rating reflects the above risks as well as those specified in the “Project Risks” chapter.

General information about the Project and ICO

Forty Seven Bank is a new type of hybrid bank which combines fiat and cryptocurrency on one platform, offering all traditional banking services to users and enabling control of  both cryptocurrency and bank accounts. The main idea of the project is to establish a bank as a platform for developers where they can place fintech applications using a profit-sharing model.

Forty Seven Bank is an innovative financial technologies startup based on blockchain technology, which is aiming to become one of the pioneers in the changing financial world and to provide their clients with:

  • Transparency

  • Security and privacy

  • Profit for all interest parties



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Smart contract platform: Ethereum blockchain

Contract Type: ERC20

Token: FSBT

Price: 1FSBT = 0.00393 ETH

Maximum number of tokens to be issued: 11,063,829 FSBT

Token distribution will be as follows:


1st Round: Nov 16 – Dec 16, 2017.

2nd Round: Dec 17 – March 31, 2018

Soft Cap:  3600 ETH

Hard Cap:  36,000 ETH

Minimum per customer: unlimited

Maximum per customer: unlimited

Accepted currencies: ETH, BTC, USD, EUR

During the ICO a bonus program is offered:

  • 1st Round: 30%

  • 2nd Round: 20%

Description of the services and scope of the project

The platform offers the following features to members:

For individuals:

For businesses:

Smart Support


Multi Bank Account Management

Biometric POS terminals

Fiat /Crypto Currency Conversion


Payment History

Transfers and Payments


Loans and deposits in fiat and crypto

Crypto wallet management

Credit/debit card management

Multi-asset account

Smart ATMs

Investments and brokerage

ICO Services

White Label

Card Issuing

Financing and Factoring

Large-scale payouts in fiat and crypto

Payment Processing in fiat and crypto

API Management


From the above list a number of features require description in more detail:

  • Multi Bank Account Management — enables managing one's accounts with different banks within the EU in accordance with the PSD2 directive, as well as managing one's crypto wallets and credit/debit cards through a single API.

  • Multi-Asset Account — enables one to convert fiat currency into cryptocurrencies and vice versa.

  • Smart Support with integrated machine learning techniques is intended to aid in resolving issues and problems between the bank and customer.

  • Biometric POS terminals — terminals enabling payment with a fingerprint (the software enables one to link their bank account/card to their fingerprint which is stored as a token in a secure infrastructure).

  • ICO services for companies staging their ICOs; the project provides such services as:

    • Legal support

    • Escrow arrangements

    • Transferring digital currencies into fiat equivalents

  • Smart ATMs and ATMs of partner banks will provide a variety of services:

    • Cash withdrawal

    • Payments and transfers

    • Insurance

    • Payment history and analysis, etc.

  • Financing and Factoring — solutions for obtaining cash for accounts payable

  • White label — through a connection to the API, partner banks will be able to provide all types of financial service available from Forty Seven Bank under their own brand, thus expanding the list of provided products to their customers.

Merchants will be able to use both traditional ways of accepting payments (card, SWIFT), and the cryptocurrency payment system, enabling customers to pay for goods both in Bitcoin and in fiat currencies when buying goods online.

Developers of banking products will have access to the following features:

  • Scoring, KYC and Compliance Services using machine learning

  • App Platform — API for developing various applications related to banking services such as mobile applications

  • Data Analytics and Prediction Models using machine learning

  • Card Issue

  • API Payments

  • App Marketplace

  • DevDays technology conferences held by the Forty Seven Bank for third-party developers and financial institutions interested in creating products on the basis of Forty Seven Bank services via the API.

The following products and services will be offered to traders:

  • Trading algorithms and hedging services, based on machine learning

  • Derivatives in fiat and crypto

  • Trading analytics — individual trading analytics

  • Trader Account Management —  for obtaining various information and reports related to a trading account; brokers, advisors and hedge fund managers will be able to connect and manage multiple accounts

  • Access to partners' exchanges through the API, using the Direct Market Access (DMA) function

  • Access to a private exchange — i.e. the Forty Seven Bank Exchange

  • Cryptobonds — debt digital instrument

  • Cryptofutures — digital future contract

Forty Seven Bank will provide a multicurrency wallet for cryptocurrency transactions to all customers. To do so the platform will be integrated with various public blockchains. A customer's interaction with the wallet is illustrated below:

The safety of clients' cryptocurrency funds will be ensured by storing their private keys in a secure private database. This database will be encrypted and will be stored in multiple data centers located in different countries. In case a customer loses their private key, they can recover it after verifying their identity upon request from the bank.

Smart contracts will provide the following possibilities for members of the platform:

  • Automation of business processes

  • Building a smart contract using a visual modeling tool that does not require programming skills

  • An escrow contract service will verify fulfillment of the terms of a transaction between seller and buyer:

    • The buyer initiates a purchase through the smart contract, at the same time the required amount funds is reserved in their account as payment for the item

    • The seller delivers the goods

    • The buyer checks the goods and then accepts or rejects the transaction

    • If the transaction is accepted, funds are transferred to the seller, if rejected, they are transferred to the buyer's account.

  • Auction contract — a seller can place goods on auction, and with each participant bid, their account will be checked to verify that they hold a sufficient amount; the required amount of funds will be locked until another participant outbids. The winner will receive the item, their money will be transferred to the seller.

  • A rental payment contract which can track timeliness in rent payments

  • A royalty contract designed to interact with owners of copyrighted content

  • Contract arbitration through a third-party arbitrator for resolution of disputes between buyers and sellers

  • Loyalty card contract will track accumulation of points on loyalty cards. Points are FSBL Tokens, intended only for use as a medium of exchange for goods and services at the Forty Seven Bank Loyalty Shop.

Forty Seven Bank App Store — using the API’s functionality, third-party developers can create their own apps through which clients will be able to use the bank's financial services. Each application will be checked for security and bugs, and the bank will recommend the best ones to its customers. Applications can be used through the bank website and via the bank's mobile application on Android and iOS.

According to information from the White Paper, Forty Seven Bank plans to provide additional services such as:

  • Whitelist and blacklist — through monitoring the activities of clients, criminals involved in money laundering will be identified and their accounts will be recorded in the blacklist. There will also be a whitelist of customer accounts with a clear transaction history. Forty Seven Bank will share these lists with other banks and the public, enabling the latter to assess if is it safe to conduct transactions with these accounts.

  • Individual and Company Authentication Service, including KYC and an OAuth 2.0 protocol designed to verify the identity of contracting agents for financial transactions.

Forty Seven Bank will also issue price-stable cryptocurrencies, secured by equivalent reserves in fiat currencies such as USD or EUR. Customers will be able to buy price-stable cryptocurrencies in order to effectively buy and sell goods in fiat currency, but with the speed of cryptocurrency transactions.

Forty Seven Bank is an ambitious project aimed at creating a BaaS (Banking as a Service) platform able to provide services in both fiat and cryptocurrencies, based upon advanced technologies. Considering such factors as the progress in machine learning technologies, global market growth in cryptocurrencies, growth in demand for online banking and the fact that the bank will meet the requirements of the PSD2, we believe that the products offered by Forty Seven Bank can gain market recognition.

Engineering features of the project

The smart contract repository is available on Github:

FSBT is a cryptographic token of the ERC20 standard on Ethereum blockchain; it is based on the Zepplin-solidity MintableToken.

Token name — FSBToken

Symbol — FSBT

Decimals — 18

The infrastructural architecture of Forty Seven Bank is as follows:

The system will be built on microservices interconnected through a message bus.

The API will be divided into domain-specific sections:

  • White Label API

  • Trading API

  • Account information API

  • Payment API

RESTful web services using the JSON Format to encode data will be used as the basis for the API.

Websocket API will be used to enable the continuous sending of large data amounts.

Webhooks will be used by the bank to notify users about events such as payments, through apps.

For the integration of biometric methods of identification into mobile operating systems (Android, iOS), the Forty Seven Bank will develop a biometric SDK (software development kit).

Machine learning will be used for risk management in customer service, fraud detection, etc. When a transaction is processed, the machine learning algorithm classifies transactions by risk levels, all suspicious transactions identified are then later processed by a team of investigators.

During the ICO, the exchange of ETH for FSBT will be made through a system of smart contracts interacting with each other:

To protect customer funds stored in cryptocurrency, keys will be stored in a secure private database that is copied, encrypted and replicated to multiple data centers around the world. Thus, customers can be sure that they will not lose their private keys or access to their cryptocurrency accounts. Customers can always recover their account data for remote access to a bank account.

Market review

Over the past few years, interest in cryptocurrency has grown expotentially. Total market capitalization at the beginning of 2018 exceeded $500 bln. Currently the most capitalized cryptocurrency is Bitcoin. The market capitalization for the top five cryptocurrencies exceeds 70% of total market capitalization, and the total number of cryptocurrencies and tokens now exceeds 1500.

Bitcoin’s advocates believe it to be an excellent means of payment which operates outside the control of governments, has global reach and is more secure than traditional payment systems. However, the increase in user numbers and in the number of uncontrolled payments have led governments of different countries to express doubts regarding its use, legality, and control. Governments and investors express concern about security issues (in 2018, $500m has been stolen from a Japanese exchange, Coincheck), drug trafficking, money laundering, aiding and abetting terrorism and the arms trade. The governments and central banks are concerned about the loss of control and regulation of the money supply. However, this has not prevented Bitcoin from becoming part of some people’s everyday lives as well as an important part of the global economy.

At this point, the adoption of cryptocurrency by governments is not uniform. Some countries have become advocates, while others have banned cryptocurrencies entirely. There will come a time when all international parties in the monetary sphere will need to legally determine what cryptocurrencies are in with respect to their own countries’ legislation. As long as the issue of cryptocurrencies is not resolved at the legislative level, companies are forced to open accounts in safe countries.

In January 2016 the European Union enacted the Payment Services Directive 2 (PSD2), which will change existing legislation with the aim of creating safer and more innovative payment systems, coming into force in January 2018. The Directive will change the overall legal framework for business and consumers when making and receiving payments within the European economic area (which includes 28 member States of the European Union plus Norway, Iceland and Liechtenstein).

Changes associated with PSD2 are largely associated with the digitalization of the banking sector. The pressure that traditional banks are already experiencing will increase, because the Directive opens the financial industry to new players other than banks, creating a much more competitive and innovative environment. The Directive encourages banks to open their API to third parties, greatly increasing competition and the quantity and quality of services in the area of payments. These new players - service providers for accounts (AISP) and service providers for payment initiations (PISP) - are a huge threat to the traditional banking sector.

Currently traditional banks are experimenting with blockchain technology as they try to determine its cost and operational efficiency saving potential. They are studying the technology in several ways, including through partnerships with FinTech, memberships in global consortia and the creation of their own solutions. Most banks are exploring the use of blockchain technology to optimize processes and reduce costs. However, they also intend to use additional benefits including improved competitiveness through FinTech, and the ability to use this technology to create new business models.

Whilst regulators are studying blockchain, the cryptocurrency market continues to grow rapidly. There are new exchanges, companies and banks.

Cambridge University conducted a global study of the cryptocurrency market. Currently there are more than 11m existing wallets and 130 cryptocoin exchanges. 52% of small exchanges have an official license; for major exchanges this figure is 35%. The line between wallets and exchanges is becoming increasingly blurred: 52% of surveyed wallets provide an integrated currency exchange feature, of which 80% offer a fiat-to-cryptocurrency exchange service. In contrast with exchanges, the majority of wallets do not control access to user keys.

Wallet providers are actively implementing new features and enhancing wallet convenience, security, and accessibility as well as a growing list of supported currencies and methods for their deposit/withdrawal.

The market for payment services is developing in line with other segments. In this study, the authors collected data from 48 companies providing these services in 27 countries. Most of them are European, while the maximum number of companies are based in the UK and the USA (15% of the total. It should be noted that Forty Seven is registered in the UK, the world's largest financial center). More than 79% of payment operators maintain relationships with the banking sector and payment networks, however, the difficulty of maintaining these relationships is a defining problem for the market.

It is logical that with growing demand for and supply of cryptocurrencies a service bringing currency exchange, payments, investment services, deposits and lending together in one place will be necessary. Such a platform will be a cryptobank; the only question that remains is whether the bank will be more secure and convenient than existing exchangers, exchanges and wallets.

Like a traditional bank, a cryptobank will be integrated in the real economy. It will be required to obtain a license. In addition, it is necessary to create an authorized fund of several million Euros (or other currency depending on the country), plus a team of experts, including financiers, lawyers and IT. After the legislative framework is formulated, issues of legalization and conversion will be solved. Services for this are already successfully operating. Ideas for cryptobanks, payment systems and exchanges and other new services are born one by one. For example, there are now more than 2,000 ATMs for buying cryptocurrency worldwide.

Thus, the potential market for the Forty Seven Bank is quite large, and its development will certainly be related to the popularity and penetration of cryptocurrency in the global financial system, but it can also function as a technologically innovative fiat bank.

Competitors and competitive advantages of the project

Many cryptocurrency enthusiasts are happy to avoid the world of fiat currency, however, the process of successfully moving from fiat to cryptocurrency requires time and a whole new banking infrastructure.

Despite the fact that many countries are suspicious of the crypto world, market participants are using both centralized and decentralized exchanges to buy cryptocurrency at the risk of being blocked by their bank. However, change is rapidly occuring, and a number of banking projects that will be part of the system and provide a simple and easy way of dealing with cryptocurrencies have already appeared.

Let's look at some of them in more detail.

ZODIAQ is a licensed cryptobank in the Comoros, which plans to provide bank account services in Bitcoin and fiat: Deposits, transfers, bank cards, currency exchange, loans and other traditional banking services. It plans to support a total of 30 fiat currencies and 150 cryptocurrencies. It uses machine learning.

Fidor is an online bank with a licence founded in 2009 in Germany working with different trading platforms for cryptocurrency exchange such as bitcoin.de and Kraken. In addition to standard banking services it offers deposits with €100,000 insurance, loyalty programs and bonus programs, savings bonds, smart community (the facility to ask financial (and other) questions and receive answers from experts, gaining bonuses for both questions and answers); members of the community can suggest new features or products; the staging of crowdfunding campaigns is possible. Each Fidor bank client has a smart account, which is an open system and supports about 25 functions, including acceptance, storage and transfer of money. All of these exist thanks to the bank's API: classic payments and money transfers by mobile phone, e-mail, Twitter account, savings certificates, microloans in one click, currency exchange, purchase of precious metals, transfer of money peer-to-peer, social brokerage (copying behavior of other brokers) — all are available via a single account at Fidor. There is a function for brokertainment. For example, a client can bet on Bitcoin rates decreasing over the next hour. Another community member can respond to his bet, wagering that at this time Bitcoin will actually grow. Gaming currency can be bought; the bank has its own app store. Foreign exchange trading is carried out through the Currency Cloud partner, and Fidor only sends it information about transactions. Any other Forex startup can connect to the app store and choose which service to use as a client.

Revolut is a bank offering cards, loans, transfers, insurance, exchange of fiat currency and cryptocurrency (Bitcoin, Litecoin and Ether), Internet banking, support 24/7.

Worldcore is a licensed bank. The project has received several European awards; it is creating a digital ecosystem making it possible to trade blockhain assets, a P2P system for loans and an international payment system for money transfers; cash back is available. It uses face recognition technology (FaceKey) and voice recognition technology (VoiceKey).

Crypterium: this project has raised more than $51m via ICO. The project aims to create a complete product that includes crypto; a cryptocard; mobile account access; infrastructure for payments in digital currency-accepting commercial establishments (at least 42,000 stores worldwide); the introduction of contactless payment technology; a loyalty program and cash back; full banking services, including lending and deposits. The company offers its tokenholders 30% of profits from transaction fees as monthly dividends.

Polybius raised more than $31m at ICO. “The project is based on the idea of rethinking classic banks using the most advanced technologies, including blockchain and artificial intelligence,” states the Polybius blog.

Wbb.io — The "World Bank Bit" bank group will be a group of ten existing banks operating under ten jurisdictions (U.S., Canada, Brazil, Germany, Russia, Turkey, China, Japan, Australia, India), providing an opportunity to conduct legal transactions using cryptocurrency and other digital assets. Management will occur via the WBB Group company, based in Switzerland. It will provide loans, payment cards (VISA/MasterCard), currency exchanging and other operations. The ICO will take place in February.

Globalbank has raised more than $11m via ICO. Global Crypto Bank aims to help customers safely store both cryptocurrencies and conventional currencies — Euros, Dollars, Yen, Yuan, etc. Connects crypto accounts with MasterCard and Visa payment systems. Will carry out all usual operations such as payment, exchange and cash withdrawals worldwide and the exchange of cryptocurrency for fiat in different countries. The system will enable one to use cryptocurrency as a means of payment around the world.

Summing up, over the past year the number of cryptobanks has increased. Currently, several companies are staging their ICOs. With such growing competition, Forty Seven will need to make a considerable effort to occupy a decent market share. We should mention the company’s following competitive benefits:

  • The offer of a platform for developers, enabling access to all infrastructural elements of Forty Seven through its API. Online identification, analysis and forecasting models, and consulting services will all be available to developers.

  • A loyalty program, bonuses and brokerage services for private clients, the bank’s own ATMs.

  • Use of the platform for commercial companies, for operating business and performing analysis.

  • Services for companies aiming to raise funds through ICOs. These will include legal support, agreements on conditional deposits and the support of conversion of digital currency into fiat. Forty Seven Bank will also develop a rating procedure for ICO projects and will provide a thorough analysis of interesting projects.

  • Appeal to traders who will be able to combine multiple accounts in one place and will offer them analysis of the effectiveness of their strategies, market monitoring, provide access to a trading platform for trading stocks, options, futures, and Forex.

  • The experience of the team in such successful projects as a gaming platform based on the Odonklassniki social network (one of the most profitable projects of Mail.Ru Group), as well as the team's experience in the development and licensing of FCA — Bilderlings Pay.


Since the Forty Seven Bank project involves the creation of a company from point zero and will be implemented on a platform to be developed after the ICO, risks typical for startups are significantly higher than normal in this case. The period between the ICO and the launch of the project is very lengthy, and is primarily due to the need for obtaining permits and licenses. However, the founders point out that there are plans to post the first version of the open API to GitHub in the shortest possible time so that developers can begin to develop applications for the launch of the project.

For the reason described above, the project also has a regulatory risk. Forty Seven Bank plans to expand its activities in the UK as an EMI from 01.08.2018 and to obtain a banking license to carry out their activities by 01.07.2019. EMI registration takes 3 months (in the case that the regulator - the FCA, has no questions regarding the submitted application); and may last up to 12 months (if the FCA requests additional documents). There are also mandatory requirements; for doing business as an EMI it is necessary to have sufficient education and knowledge for management purposes and for obtaining an EMI license. This implies the following:

  • Senior management must have experience in running such companies. For the FCA this is important; people with no experience in this area usually do not obtain permission.

  • The company should be managed from the UK.

With regard to the specified risk, the founders state that the team has enough experience for obtaining all necessary licenses; still the risk remains. And if the terms for receipt of permits and licenses stated in the roadmap are moved, this will threaten the existence of the project and may cause “panic” for ICO participants.

We should also note the growing competition. The Forty Seven project will have to constantly improve the project to compete in its environment, to retain current clients and attract future ones. Given that regular banks have already started to implement blockchain technology in their business processes, the time when giants in the banking business enter the cryptocurrency market is not far away.

We have not identified any other significant risks.


The team working on the development and implementation of the Forty Seven Bank project is “united by the common goal of providing high-quality, secure and convenient banking services”.

Leading positions are occupied by:

Alexander Malin (LINKEDIN) – Co-founder and CEO/CVO.

Alexander has been involved in Forty Seven since April 2017. Responsible for the concept and development of the project. He has wide and successful entrepreneurial experience, being a co-founder of companies like iAM.works and Bilderlings Pay. As Senior Managing Director of Bilderlings Pay, Mr. Malin acquired substantial experience in financial technology products and services, as well as their legal authorization in the UK.


  • IAIT – 2009-2011;

  • Transport and Telecommunication Institute – 2005-2009.


Igors Astapchiks (LINKEDIN) – Co-Founder and COO.

Igors has been involved in the project since March 2017. Igors is a strong business development professional, being co-founder of such companies as iAM.works and Bilderlings Pay. An experienced Chairperson with a demonstrable history of working in the information technology and financial technology industries. Skilled in strategy, finance, digital assets (e-money, cryptocurrencies), IT product development and relationship management.


  • Baltic International Academy – 2007-2011.


Vladimir Tomko (LINKEDIN) – Co-founder and Chief Marketing Officer.

Responsible for the marketing strategy of the project. For the past three years he has work as game producer at Odnoklassniki (Mail.ru Group). He has more than 12 years of experience in interactive entertainment industry.


  • Rīgas Tehniskā universitāte (Riga Technical University) — 2005–2014.


Mihails Skoblovs (LINKEDIN) – Co-Founder; CFO at Forty Seven Bank.

Mihails has been involved in the project since March 2017. Mihails holds a BSc in economics and business administration from the Stockholm School of Economics in Riga. He has wide experience in corporate finance, private equity and business development.


  • Rīgas Ekonomikas augstskola — Stockholm School of Economics in Riga, 2005–2009.


Aristoteles V. Daza (LINKEDIN) — Co-Founder.

The head of the Trading Department, as well as of the Investment and Brokerage Depts. He is a commodities trader working in the areas of oil and precious metals, with work experience in continental Europe, the UK and Latin America. He has an entrepreneurial spirit and has produced successful business ventures in the area of algorithmic trading.


  • University of London

  • University of Birmingham


The following people are also involved in the development of the project:

Anton Azamatov – Chief Technical Officer

Lily Forgeron – Art Director

Jevgenijs Lesevs – Head of Internal Audit

Vitalijs Grundsteins – Software Development Project Manager

Kristiāna Štauere – Leading Analyst

Nana Zhang – Community Manager, Asia


10 people have been recruited as advisors including:

  • Evgeniy Bezgodov — COO of Deiteriy Co. Ltd.

  • Alexander Chernyakevich — CTO of Scand

  • Morten Hansen — Head of Economics Department, Stockholm School of Economics in Riga

  • Dmitry Dudin — Head of Products and Services development department at XB Software, Ltd.

We would like to note that the team has experts from the spheres of finance, marketing and professionals with experience in obtaining EMI and PI licenses, which will have a positive impact on the launch and development of the project.

Development strategy and the Roadmap

The development of the Forty Seven Bank concept began in October 2016. According to the founders, the bank is not the ultimate goal of the Forty Seven team. Its main task is to create a hi-tech platform for customers to develop their own trading applications, both on the basis of fiat money and in the crypto world. For the full functioning of the product as a developer platform however, the project will need a banking license.

To achieve a high level of service, the team is using modern technologies and developments: blockchain, biometrics, machine learning, etc.

From February to November 2017 several measures were taken to launch the project:

  • Team was formed

  • Necessary research and market analysis were carried out

  • Development of a detailed project plan

  • The financial model was built, the necessary calculations were made

  • Documentation for the crowdfunding was prepared

In November 2017, the first round of crowdfunding was launched.

Key stages for the platform’s development are presented in the diagram below:

Upon reaching its hard cap of 36,000 ETH the Forty Seven Bank plans:

  • To obtain a banking license from the FCA in 2019.

  • Start processing payments from the beginning of 2019.

  • To offer loans to the amount of about 80m Euro in the first year of trading.

  • To attract 65m Euro in customer deposits by 2022.

  • To obtain a profit margin of over 65% in 2020 equivalent to average returns (ROAE).

We believe that, given the successful completion of the ICO and the team's implementation of all plans for the development of the Forty Seven platform since 2017, it is possible to achieve their main objectives within the specified time.

Marketing strategy

Forty Seven Bank assigns the status of ‘Top Priority Clients’ to investors participating in the ICO and provides them with a wide range of products and services, as well as a chance to increase their investment in tokens during their subsequent circulation in the secondary market. In particular, the bank provides ICO participants with an annual loyalty rewards program in additional FSBL tokens that may be exchanged in the Forty Seven Loyalty Shop for various products and services. Top priority customers will be able to vote on how the Forty Seven bank will "help the world".  A portion of the the annual revenue for the bank will be spent on charity, for example on support for an orphanage in London, school repairs, a series of educational conferences for the blockchain community, etc. The biggest token holders will comprise a special council which will choose possible alternatives from a list provided by the team. Options will be submitted to all token holders for vote.

To attract investors, the project team is using the following channels:

In order to participate in the bounty program, investors must be members of the official Forty Seven Telegram Group. The prize pool for the bounty program is planned to be distributed as follows:

  • Community management campaign — 10% (0.5% of the total number of issued tokens)

  • Avatar and signature campaign — 25%(1.25% of the total number of issued tokens)

  • Translations campaign — 20%(1% of the total number of issued tokens)

  • Blogging campaign – 20%(1% of the total number of issued tokens)

  • Facebook campaign – 10%(0.5% of the total number of issued tokens)

  • Twitter campaign – 10%(0.5% of the total number of issued tokens)

  • Telegram presence campaign – 2%(0.1% of the total number of issued tokens)

  • Bug tracking campaign – 3%(0.15% of the total number of issued tokens)

Information about the project can also be found on the following portals: TOP ICO LIST, ICO GLORY, ICO DAILY.

Mentions of the project can be found in the press (Cointelegraph, YAHOO FINANCE, Coinspeaker, etc.) In total, they can be found in more than 30 news media.

In Russia an interview with one of the founders of the company was recently held on a federal channel.

Forty Seven is actively expanding its partner network which includes such well-knwon names as NGrowth, Microsoft Azure, and XB Software.

It is important to note that Forty Seven will develop its global marketing strategy only after the bank begins to function as a complete business; currently management has a vision for future promotion of the project as follows: In the last few years cyberneticists have obtained a series of breakthrough results and achievements in such important technological areas as computing power and data storage capabilities (Big Data). In this context, it is quite logical that the management of Forty Seven Bank considers Machine Learning to be an indispensable tool for improving the efficiency and accuracy of its operations, using it in their operational, analytical and trading applications. In particular, in its marketing strategy, the team plans to use Supervised and Unsupervised Machine Learning Algorithms for clustering customer segments and their respective product lines. It should however be noted that the R&D team is using common statistical multivariate regression models in these algorithms, the adequacy of the application of which is based on a number of assumptions that are difficult to check. These include in particular an initial assumption of the Gaussian distribution of the vast majority (and sometimes all) model parameters (random variables) and their finite sums. This in turn implies the need to verify a Gaussian distribution composed of these random variables multivariate random vector. As the vector version of the problem has not yet been solved to date, the use of multivariate regression statistical models will always lead to some distortion of results. However, these approaches are relevant in marketing and are widely used, which makes the use of the above models and algorithms eligible.

Economy of the Project

The project’s economy is based mainly on commissions from providing customers with both classic banking products and cryptocurrency products such as cryptobonds, cryptofutures, etc. In addition to this commission the Forty Seven Bank intends to receive income from providing brokerage services.

Revenue Streams

Forty Seven is positioning itself in the industry in the first place as a bank platform for fintech applications (both fiat and crypto) but with a much wider range of innovative products and services than others. The bank's revenue is generated in three main streams – interest income, fee and commission income, and income from trading portfolio assets. The percentage for each revenue stream as part of total operating income over the next ten years is shown in the following diagram:

Interest income

Starting from the first year of its operation the bank plans to build its own loan portfolio of borrowers. The size of this portfolio will depend in particular on the amount of assets. The diagram below shows the expected size of the loan portfolio over the next five years in more detail; this portfolio involves high liquidity and a low credit risk. Forty Seven’s management believes that this revenue stream will generate 5% to 10% of total operating income in the first year, with an increase to 15% or more in subsequent years.

Fees and commissions income

The team considers this as the main revenue stream for the bank. It is expected that between 2019 to 2023 income from commissions and fees will be more than 70% of total operating income. The bank intends to provide a wide range of possibilities for use of cryptocurrency, significantly lowering transaction costs for converting fiat money into non-fiat and vice versa. Taking into account the high risk of the volatility of digital assets, the bank is building various hedging strategies to reduce this risk for client portfolios.

Trading Income

The trading portfolio of the bank will comprise 5% of total assets by 2019. Forty Seven plans to build up this asset class to 26% by 2022. The project has a team of experienced professional traders under the leadership of the co-founder, Aristotle Vargas. Forty Seven traders have experience in markets of fixed income, equities, derivatives and commodity and currency markets.

Cost structure

1. Operating expenses

The structure of transaction costs is shown in the following diagram.

Marketing expenses during the first three years are higher than in subsequent years; this is due primarily to an increase in client activity, as in the first three years the rate of growth for the customer base as a rule is significantly higher. Depreciation of both tangible and intangible assets is calculated with the assumption that their lifecycle is no more than four years. Loyalty program costs are insignificant in initial years, but they significantly increase later. Interest expenses are not so high since attracting capital through deposits from customers and banks is not considered by the management as a primary source. Commission expenses largely correlate with the number of customers and transactions.

2. Capital expenses

Volume of attracted capital is the most important criterion of the project’s ability to develop its line of products and services. An assessment of capital expenditure for Forty Seven is provided in the following diagram:

In summary, we point out that the business model is based on projected growth in number of clients. The aim for the bank's management is to gain 1,000,000 clients over the next three years.

We note the high quality of preparation for the financial model presented to us in the course of writing this review. The model involves several options for business development depending on different factors.

Token investment attractiveness

The FSBT Token is a utility token; it does not provide stocks or shares in the project, nor confers any rights to receive future income or any voting rights. The major factor in any increase in the price of the token will be a constant increase in client numbers on the platform. The project’s creators aim to reach 1m customers within 3 years, which in our opinion is quite possible because the PSD2 Directive has come into effect in the EU, and currently this market segment has a high growth potential.

The PSD2 Directive is a big step towards open banking standards. In many respects it will be a great equalizer, giving innovative banks and financial technology companies equal opportunity to create their own type of service; this is the aim for the Forty Seven Bank. This factor can offer a boost to the development of the project’s idea, achievement of its goals and tasks, and thus strengthen the position of the token.

To compete in the prevailing conditions the project will develop a wide range of services offered on the platform for a variety of clients, so payments on the platform will be carried out in various currencies: fiat currencies and cryptocurrencies by customer choice, pushing the FSBT token to the side.

The fact that the token is not exclusively infrastructural in nature, and that FSBT offers some advantages to its holders, indicates that the Forty Seven Bank ICO is just for raising funds to develop the platform launch it. The following statement from the founders can serve as an indirect confirmation of this: “In our opinion, ICO is currently the best and quickest way of attracting f­inancing for interesting projects, especially for those that are community driven and aim to develop important infrastructural elements related to cryptocurrencies. We believe that ICO can boost innovation, as attracting funds via ICO procedure companies does not require undergoing traditional bureaucratic procedures. Moreover, as ICO is conducted via smart contracts and blockchain, everything is transparent and project authors have full responsibility for successful realization of the idea.

ICO also offers the opportunity for people from different countries to contribute their digital assets to projects and teams situated in other countries. In traditional economies there are many restrictions and limitations for individuals to participate in such activities and there are no possibilities for people to contribute relatively low amount of funds into projects with promising non-financial benefits”.

Some of the benefits for holders of FSBT tokens include:

  • Priority in the loyalty program of the project

  • An opportunity to contribute to the development of the crypto-community and to help in charity campaigns

  • Discounts and special terms on products and services of the platform

  • Higher cashback in tokens when payments made with a Forty Seven Bank debit or credit card

  • Free access to the most used mobile and online banking products

  • No fee for the use of an account with multiple assets

Special benefits for participants of the ICO (token holders) depending on amount invested:

  • 0.1 – 1 ETH:

    • Free multi-currency account: IBAN (EUR, USD, etc.), crypto wallets (BTC, ETH, etc.), investment

  • 1 – 5 ETH:

    • Free multi-currency account: IBAN (EUR, USD, etc.), crypto wallets (BTC, ETH, etc.), investment

    • Free Visa Classic credit card

  • 5 – 10 ETH:

    • Free multi-currency account: IBAN (EUR, USD, etc.), crypto wallets (BTC, ETH, etc.), investment

    • Free Visa Platinum credit card

    • 25% discount on personal and travel insurance for the payer and two of their family members for the first two years

  • 10 – 50 ETH:

    • Free multi-currency account: IBAN (EUR, USD, etc.), crypto wallets (BTC, ETH, etc.), investment

    • Free Visa Platinum credit card

    • 30% discount on personal and travel insurance for the payer and two of their family members for the first three years

    • No fee for cash withdrawals in any ATM in the world in the first year

  • 50 – 100 ETH:

    • Free multi-currency account: IBAN (EUR, USD, etc.), crypto wallets (BTC, ETH, etc.), investment

    • Free Visa Platinum credit card

    • 50% discount on personal and travel insurance for the payer and two of their family members for the first five years

    • No fee for cash withdrawals in any ATM in the world during the first three years

    • Special terms for trading activities

  • More than 100 ETH:

    • Free multi-currency account: IBAN (EUR, USD, etc.), crypto wallets (BTC, ETH, etc.), investment

    • Free Visa Platinum credit card

    • 50% discount on personal and travel insurance for the payer and two of their family members for the first ten years

    • No fee for cash withdrawals in any ATM in the world during the first five years

    • Special terms for trading activities

    • No fees and charges for the use of any products and services of the platform on a regular basis (excluding loans).

In order to encourage holders of FSBT to the store the tokens in their wallets for as long as possible, the Forty Seven Bank will launch a loyalty program on the basis of the tokens. Holders of FSBT will be the priority clients for the bank in the loyalty program. The bank intends to invest 20% of net profit earned in the previous year in the loyalty program, issuing FSBL tokens to be distributed proportionally among existing holders. For every 1 EUR allocated to this purpose, 1 FSBL token will be generated. FSBL issue will be provided by growth in company earnings, and for long-term holders who bet on the business growth, retention of tokens is better economically the longer the period of retention.

FSBL tokens can be exchanged for various products and services in the Forty Seven Bank loyalty store: Plane tickets, hotel reservations, various gift cards, mobile phones, laptops, gadgets, clothes, food, Forty Seven Bank products and so on.

To increase the attractiveness of FSBT at the ICO, a bonus program has been developed (see “Information about the project and the ICO”) which will be of interest to potential users of the platform.

Based on the above data, participation in the project will be interesting:

  • for long-term holders of FSBT Tokens — increase of the price will be directly dependent on the growth of the company's business.

  • For short-term investors — the bonus system for different stages of the ICO that could lower risks for early participants.

The information contained in the document is for informational purposes only. ICORating received monetary compensation in the amount of $15080 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.