BMJ Score: 2.3
Quick Summary19 Investors read this
CommentaryTraditional currency-based trading provides little possibility for micro investors to make large profits. While crypto investing combats this by allowing individuals to profit, there are huge risks involved. Specifically, there are risks around the current centralization of financial institutions, cyber security issues, currency volatility, and regulatory pressures. The Hexancoin team wants to create an exchange that will be fast, secure, and based on the estack algorithm to predict the upcoming price of various cryptocurrencies. It will also offer limit order book for high-frequency trading, which will ensure that liquidity remains healthy at all times. It is clear that the crypto trading market needs enhancement, but there are numerous platforms out there trying to solve these issues. While the Hexancoin platform claims to have a unique technology through the estack algorithm, this is not patented and does not provide the project with an advantage. One red flag that comes to mind for us stems from the claim that the HXC token will not be allowed to be sold below the ICO price. However, as this is an ERC20 token, anyone can trade it on a decentralized exchange. Additionally, while the team does have a working demo of the UI, the roadmap does not clearly indicate what year the platform MVP will be released. Another concern is around the team, which is only made up of 7 individuals. There are only 4 developers and no listed partners. Only a few of the team members have LinkedIn verification, and those that do have limited experience or no prior track records of successful ventures. Regarding user adoption, Hexancoin decided to outsource marketing to potential investors by promising a reward for the best potential ad developed by users. We do not think this is the best strategy given its lack of market presence. Overall, it is evident that the crypto exchange space is in need of enhancement. However, given the lack of differentiation, small team, poor transparency, and low market clout, we do not feel confident that Hexancoin will be the project to deliver this innovation.
- How to invest: Interested investors can follow this link to sign up for the Hexancoin presale.
- Discount: 10% bonus throughout the presale.
- Eligibility: Residents of China and the U.S. may not participate.
- Token Price: 1 HCX = $.11 USD (discount included in price)
- Jurisdiction: India
- Problem addressed/solved: Hexancoin believes that current crypto exchanges don’t have the capacity nor the capability to execute all the transactions required of them. Hexancoin wants to enter the market with the goal of solving the extensive transaction delays, lack of analyst information, and cyber security issues that most exchanges experience today.
- Target customers/customer/ segments/verticals: Hexancoin is targeting the general crypto investment market as both experienced and new traders look for better exchanges than the big brands on the market. Hexancoin will want to make a hard push for active traders as they will have the most to gain from the Hexancoin speed and advanced trading tools.
- Value creation: Hexancoin looks to provide functionalities that should be non- negotiable in a quality cryptocurrency exchange. Hexchange will be a fully integrated cryptocurrency trading exchange that resolves the key issues and challenges that traders are facing with current exchanges such as speed, reliability, and security. Hexancoin wants to add key differentiators like a trading bot that will find stocks that can move with range and volume. The advanced trading eStack bot and high liquidity will help separate them from the competition.
- Competition: Hexancoin will face some intense competition in this space. The project will have to battle it out for market share among the giants of Coinbase, Binance, Bittrex, and Gemini. Plus, it has to worry about hundreds of other ICO projects looking to make a name for themselves in this space.
- Market size/potential: Trading volume per exchange has plummeted since the bitcoin highs of January 2018. Many people have withdrawn from the crypto market entirely as the market has gone down over the past dozens months. That being said, new accounts are created everyday on sites like Binance and Coinbase, showing a continued interest that could be sparked further if the market were to take off due to some new regulatory recognition or major acquisition.
- Regulatory risks: The biggest risk here is around the fact that the success of this platform is contingent on the success of the crypto market. If the crypto market has regulatory mandates against it, it will hurt the success/growth of this platform.
- Investor value: Investors can achieve value in two different ways with Hexancoin. They can either purchase and hold on to HXC tokens in the hope the exchange takes off and millions of people want access to the platform, driving the value of the token (which serves as the key to the exchange), or investors can take their HXC and deposit them in a specified wallet where an eStack bot will actively trade the tokens for 24 hours in the hopes of returning short- term profit.
- Disclosures: Hexancoin has made a few crucial errors that raise many red flags on the transparency and trust side of things. First, it fabricated its follower count and bought thousands of followers to trick people into thinking the project had real traction. It also failed to produce an MVP prior to the token sale, and the project only has a short whitepaper that, although it’s well-organized, lacks some of the crucial information investors must know such as its “Use of Proceeds”. Hexancoin may not have started off on the right foot, but the team can turn this all around by making some key adjustments.
- Token distribution: 50% token sale, 15% R&D, 15% team, 10% marketing and promotions, and 10% reserved token.
- Use of proceeds: Information not provided.
- Caps: Soft cap: 4,000 ETH; Hard cap: 22,000 ETH
- Track record: Many of the core team for Hexancoin looks as if they wouldn’t be allowed to have a legal drink in the United States; that’s how young they appear. The majority of the team has graduated from university within the past three years, and some only have work experience stemming from internships rather than legitimate full-time positions. Both Shekhar Kahar (Co-Founder) and Preety Kumari graduated from school in 2018, which means they have no work experience and instead are trying to jump into blockchain with a startup. It’s absolutely possible that this team has the knowledge and work ethic to carry out this project, but in terms of strength of team compared to other projects, it’s not even close. Investors want to see qualified professionals, hefty experience, and leadership consisting of at least one serial entrepreneur.
- Integrity: It’s nearly impossible to judge the integrity of this group because there’s virtually no background information on them due to their youth. The Hexancoin team must make an especially strong effort to display transparency and professionalism as most investors will avoid the project simply because of the team’s inexperience.
- Shekhar Kahar, Co-Founder & Stack Developer (LinkedIn)
- Preety Kumari, Co-Founder & Machine Learning Engineer (LinkedIn)
- Anupam Chakrawarti, Co-founder & System Administrator (LinkedIn)
- MVP: Hexancoin is essentially kicking off the project with the presale and main sale. It has yet to really complete anything on the development side, or at least the team hasn't released anything to the public, whether that’s a demo or UI/UX screenshots. According to the roadmap, it plans to launch Hexchange and the Coin Listing in Q2 of 2019.
- Token use case: Hexancoin is using the ICO as a primary fund source to develop its eStack. The HexanCoin (HXC) token provides traders with access to a platform that incorporates all of the components that investors need at one place. It appears that depositing HXC tokens into your wallet will also allow for the use of the eStack bot to trade on an investor’s behalf for the duration of 24 hours and profit generated will accordingly get distributed.
- Value-added: The HXC token provides holders with two main sources of value: access to the platform and the eStack trading bot. The trading bot uses an advanced algorithm to conduct auto trades with your funds for 24 hours to make profit in that short window of time. The eStack bot honestly sounds too good to be true, so investors should remain cautious when looking at it as an additional source of investment revenue. Hexancoin must prove that the bot works for this to really gain traction;, otherwise it’s all just hearsay.
- Decentralization: Hexancoin plans to implement the crypto-exchange with both centralized and decentralized technology to provide both security (decentralization) and speed (centralization).
- Token Supply: Max supply of 220 million HXC.
- Technical difficulty/investment expertise needed: Hexancoin wants to create a smart-crypto trading platform, i.e another exchange to go along with the other thousands of exchanges. The goal here for Hexancoin is simple: create a smart crypto-trading platform where users will be able invest their fiat money on cryptocurrencies, trade them securely and efficiently and generate profit over time.
- Halo effect: Hexancoin has not listed any partnerships.
- Buzz: With Hexane Coin, we have found yet another project that’s inflating its follower count. The project has thousands of Facebook followers yet only receives a few likes per post. BMJ urges investors to take a closer look into a projects self-reporting numbers and general information as many things are often too good to be true. In terms of media coverage, Hexancoin has been featured by the usual group of ICO sites that like to round up projects for general content.