BMJ Score: 3.5
Quick Summary75 Investors read this
CommentaryThe global ecommerce industry is valued at over $10.7 trillion, and there is huge opportunity for new marketplace models to help engage customers. Despite growing interest in crypto, there is a deficit among crypto-friendly marketplaces, especially for purchasing luxury goods. Luxreum is bridging the gap between modern customer desire and outdated ecommerce systems by building a marketplace that utilizes blockchain’s transparency to prevent counterfeit goods, automate tasks with smart contracts, and develop a network to promote the global adoption of cryptocurrencies. They have a large team with many advisors, but the most impressive aspect of their organization is the strong partnerships with companies such as IBM, SalesForce, and Deloitte. We like that they have patents pending on their e-commerce API and escrow protocols, and we are excited to see if their whitepaper comes to fruition. While we think Luxreum is targeting a good market with a focus on vehicles, travel, real estate, and other luxury goods, we do worry about their lack of marketing. There is very little readily available information on Luxreum, and without a working product, their nonexistent online presence does not raise our confidence. We think that Luxreum has a great idea and a solid team with impressive partnerships, but needs some more time to properly cultivate their user base and platform.
- How to invest: Register for the token sale by clicking either the Sign up, Register or Buy Token Now buttons located throughout the Luxreum site.
- Discount: Pre-Sale Round-1 20% Bonus (09/23/2018)-(09/30/2018); Pre-Sale Round-2 10% Bonus (10/01/2018)-(10/08/2018)
- Eligibility: Residents of China, North Korea, and Singapore are not allowed to participate. U.S investors CAN participate as long as their net worth is above $30,000.
- Token Price: 0.10 USD =1 LXR not including bonus
- Jurisdiction: St Kitts & Nevis
- Payment Methods: ETH, BTC, LTC, BCH, DASH & NEO
- Minimum purchase: $50.00 USD
- Problem addressed/solved: Luxreum wants to resolve issues like counterfeiting, obsolete transaction models, the high cost of fiat conversions, and lack of technological innovation, along with staying relevant to the rapidly changing customer demands in the high-end market.
- Target customers/customer/ segments/verticals: Luxreum Global aims to create a global marketplace for premium-segment products and services with well-to-do cryptocurrency holders as a major target group. It will develop an online global marketplace for B2B and B2C consumers to include: vehicle industries (automobiles, light trucks, and power sports), recreational products, home & business products, aviation, marine industry, financial & insurance products, and concierge services.
- Value creation: Luxreum aims to create a global online marketplace that utilizes the security, immutability, and the frontline tools offered by blockchain technology. It allows Luxreum to curtail challenges like counterfeiting, processing delays, and excessive forex conversion fees involved with higher-value purchases. Additionally, Luxreum will accept cryptocurrencies as its primary payment option, limiting the overhead charges customers pay for banking transactions.
- Competition: Luxreum will compete with global as well as regional marketplaces functioning around the world. Its primary competition will include ecommerce stores run by high-end brands and established platforms such as James Edition and Home Advisor. Unlike its competitors, Luxreum will serve a global clientele, stretching its operations through a global network of certified partners.
- Market size/potential: The global luxury and premium industry is worth over $6.7 trillion, and after facing a stagnation for the past couple of years, it has returned to a stable growth rate of 3 to 6% globally and is quite likely to maintain this growth through the next couple of years. It’s true what you hear in the news; the wealthy continue to get wealthier, meaning they’ll look for new avenues to purchase the toys that the rich love.
- Regulatory risks: No regulatory authority has yet examined or approved the whitepaper. The token has the potential to face high levels of regulation and it is not yet approved as a method of exchange.
- Investor value: LXR tokens will achieve higher value as more users join and interact with LXR on the platform. Although Luxreum has an above average token supply at 2 billion, the high value transactions that occur on the platform will often require thousands of tokens, which will inherently drive the value of LXR.
- Disclosures: What Luxreum lacks in sheer number of documents, they make up for in quality of whitepaper and website. Their whitepaper just might have the most organized and easy-to-read material among all pre-ICOs analyzed by BMJ. They follow a clear protocol of how they communicate their product so that anyone can understand exactly what’s going on. Furthermore, they have a patent pending (#62696823) for their escrow solution, which offers a universal cryptocurrency exchanger to its platform users.
- Token distribution: 30% community reserve, 30% crowdsale community, 25% company reserve, and 15% team & advisors.
- Use of proceeds: Legal 2%, Overhead 5%, Operations 20%, Development 38%, and Marketing 35%.
- Caps: Soft cap: $5 million USD; Hard cap: $60 million USD
- Track record: Luxreum has an extensive team of 14, with most employees having worked in branding distribution, lending, licensing, logistics, and marketing throughout the auction, automotive, aviation, construction, luxury, marine, travel and tourism industries. The CEO, Kenn White, and Managing Director, Frank Clinton, each have a variety of work experience in the automotive industry. It appears that Luxreum was likely construed as a marketplace for luxury cars that could be bought with cryptocurrency since the process of buying such vehicles involves a lengthy (and arguably unnecessary) purchasing process.
- Integrity: The executive team has the passion for the project, but it’s questionable as to whether they have the capacity to carry it out. They’ve brought on a lot of team members early on in the life of the business, which could come back to bite them as it sucks their existing funds into human capital rather than development software.
- Kenn White, Executive Team (LinkedIn)
- Frank Clinton, Executive Team (LinkedIn)
- Sean Marsh, Executive Team (LinkedIn)
- Dr. David Meszaros, Chief Legal Officer (LinkedIn)
- MVP: Luxreum has yet to release a working MVP. Their roadmap states that they are conducting App and MVP testing during Q3 of 2018, but it appears that an actual working product won’t be available until next year.
- Token use case: LXR is the native cryptocurrency of Luxreum’s global marketplace. LXR is an ERC20-compliant token. LXR tokens will be used for marketplace payments. LXR can be used for all the purchases on the global marketplace and will attract 0% transaction fee for the first year, 0.1% for the second year, and 0.3% for the third year onward, making it the best option to pay in the marketplace. The LXR token will also be used for transaction fees & membership charges, and to pay for purchases through Partner Network. (Customers can utilize LXR tokens to pay for premium goods and services available on the Partner Network, allowing them to use LXR tokens globally).
- Value-added: The LXR token creates a frictionless user experience on the Luxreum platform. The extremely low (and initially free) transaction fees will certainly incentivize everyone to use the token versus other forms of payment. The nature of the token will also allow global transactions to occur instantly and virtually effortlessly.
- Decentralization: Luxreum doesn’t explicitly detail the nature of their decentralization, but they claim that the decentralized nature of blockchain will add further security to their platform.
- Token Supply: Max supply of 2 billion tokens
- Technical difficulty/investment expertise needed: Luxreum aims to cater to cryptocurrency holders with major money to spare. Although few will have the dollars to participate in the fun, the concept is easy to grasp.
- Halo effect: Luxreum puts a huge emphasis on the acquisition of partnerships for the future success of the platform. They put their partners through a rigorous vetting system to ensure a beneficial relationship. They have some reputable standing partnerships with IBM, SalesForce, Deloitte, and other lesser known companies.
- Buzz: Luxreum has a very low following on social media. Luxreum activated their Twitter account in July 2018 and only have 10 followers at the time of writing. Their Telegram account is equally attractive with only 835 members. They’ll definitely need a huge marketing push in order to communicate their project to the masses, which shouldn’t be too difficult considering how cool their platform is.