While 2018 has seen a significant slowdown in ICOs relative to the previous year, due in large part to poor market conditions, there have been a few high profile token sales that have drawn significant attention from investors.

One such sale was recently completed by TokenPay, a blockchain project that is building out a platform that combines banking and a closed-end private exchange. TokenPay, which raised nearly $25 million in its ICO, aims to build a decentralized financial institution that includes everything from a licensed bank to a fully liquid exchange and payment platform (both peer-to-peer and merchant). Additionally, TokenPay is focusing on privacy in transactions through multiple features, including the integration of zero-knowledge proofs, dual-key stealth addresses, multi-signatures and ring signatures. Essentially, TokenPay plans to create a blockchain infrastructure that further supports mainstream blockchain adoption.

Interested in TokenPay? Here’s a quick rundown of the project:

Platform & Development

In short, TokenPay is developing a multi-utility blockchain platform that is supported by a project-owned banking infrastructure. According to the TokenPay white paper, the project is currently in negotiations to “form a new bank charter, acquire a bank or partner with a 20-year-old bank, in an attractive, privacy-driven jurisdiction.” Basically, TokenPay intends to offer traditional banking services with regulatory oversight and fiduciary status (AML and KYC will be applied), but with offerings designed for digital assets. This bank, which plans to operate in the Hong Kong dollar, will likely be located in Germany as TokenPay has acquired 9.9% of a bank in the area with an option to purchase an additional 75% stake in the bank pending regulatory approval. This acquisition would work to get TokenPay a seat at the table with major financial institutions.

TokenPay aims to establish its coin, TPAY, as the main denomination for services and fees on its platform. TPAY is built on the Bitcoin core, but with a number of privacy-focused features. These include multi-signatures, ring signatures, dual-key stealth addresses, ZK proofs (zero-knowledge), along with a fully encrypted and decentralized Tor network integration. While having this many security protocols is perhaps overkill, TokenPay aims to differentiate TPAY from other privacy coins through these protocols. TPAY also leverages a proof of stake consensus algorithm that pays out ~5% yearly interest for stakers.

Through its banking system, TokenPay aims to build a suite of services and products for cryptocurrency payment and storage:

International Multi-Currency Crypto Debit Card: A BlueDiamond debit card that is easy to load given its direct connection to the TokenPay digital wallets. The debit card will work virtually or at point-of-sale merchant locations. Crypto debit cards are a notoriously difficult product for projects to release given regulatory hurdles, but TokenPay’s banking acquisition should work to reduce these barriers.

Payment Processing Services For Online Merchants: TokenPay’s merchant services division offers businesses around the world the opportunity to transact with TPAY as well as other cryptocurrencies. This system will allow for seamless acceptance of cryptocurrency and will offer significantly lower fees when compared to other payment processing platforms. TokenPay is currently focused on merchants needing the highest level of privacy, including adult webcam businesses.

TokenPay Secure Multi-Screen Encrypted Wallets: TokenPay’s secure encrypted wallets leverage a unique proof of stake automation technology that allows users to stake their TPAY directly in their mobile device. Users are able to access TPAY whenever needed through the platforms closed-end, real-time private exchange which works to eliminate the need to convert exact quantities to conduct fiat transactions.

TokenPay is currently working on developing its decentralized exchange, given that its multi-signature transaction engine merchant processing platform requires an integrated exchange mechanism with a tight bid and ask spread. While they build out their own exchange, they are actively pursuing multiple third-party exchange integrations, including with QUOINE.

Additionally, TokenPay is actively working on partnerships with some major cryptocurrency projects, including Verge and Litecoin. Regarding the Verge partnerships, it has been confirmed that TokenPay donated 65 million XVG to verge to achieve its partnership with Pornhub. TokenPay is also working with Verge to create the first Verge debit card, to further promote real-world adoption of the privacy cryptocurrency.

The relationship between TokenPay and Litecoin began with a simple Twitter conversation between TokenPay founder, Derek Capo, and Litecoin founder, Charlie Lee. It is reported that as of April 22, 2018, TokenPay currently holds an NDA with Litecoin, and some have speculated that there could be a potential partnership to co-invest in TokenPay’s banking infrastructure.

Thanks. Let me know if there's anything I or the Litecoin Foundation can do to help. Dm me. — Charlie Lee [LTC⚡] (@SatoshiLite) April 17, 2018

TokenPay has also recently acquired a Latin American gaming software company. Through this acquisition, TokenPay now owns several strategic assets, including a Curacao license and master reseller agreement with Microgaming, which is notoriously difficult to obtain. TokenPay believes that gaming is a fundamental vertical for the new blockchain industry. Additionally, TokenPay is close to signing a major deal with an Austrian company that owns 1,500 tobacco shops in Europe

2018 will be a big year for TokenPay. The event everyone is waiting for is the confirmation of the bank acquisition or equivalent partnership. This milestone will be the driving force for many major milestones in the future, including the creation of the merchant platform and physical debit card.

Team

The TokenPay team is led by Derek Capo, a former hedge fund analyst who most recently served as VP of International at RoboTerra. Rounding out the management team, TokenPay has a number of executives with backgrounds in marketing, finance and cybersecurity. It is notable that TokenPay is advised by Sunerok, the Lead Developer of Verge.

Token Financials

TokenPay (TPAY) currently has a market cap of ~$120 million with a circulating supply of 15,295,909 TPAY, a total supply of 19,026,924 TPAY and a max supply of 25,000,000 TPAY.

Final Take

TokenPay is an interesting project that aspires to create the first major blockchain-based banking system. Through an aggressive approach to partnerships and a unique approach to acquiring an established financial institution, TokenPay could be on the cusp of major value creation.

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Disclaimer: The author(s) of this article may have a position in one or more of the cryptocurrencies mentioned above. This article is for informational purposes only and should not be taken as investment advice. Always conduct your own due diligence before making investments.