Cosplay Token Review — A new way to sponsor your favorite Cosplayers
Cosplay Token is a new cryptocurrency aimed to help financially sponsor Cosplayers around the world. But why create a new coin for this specific purpose when you could just sponsor your favorite cosplayers with Bitcoin, Litecoin, Ethereum, or any of the 1000+ coins that already flood the market?
For this review, I have studied the Whitepaper, the team involved, the market they plan to enter, token value for investors, looked for pros&cons, possible red flags, and also have spoken directly to somebody involved in this project to answer my questions and doubts, in the case of this ICO I have spoken to Junichiro Kawai, the CEO of Cosplay Token.
Cosplay Token (COT) will be used by the Cure World Cosplay website, a community also managed by the same team, the main idea behind COT is to use it for contributing to individual cosplayers and getting something in return such as access to exclusive contents or events. In that way COT will be more similar to Patreon than to other cryptocurencies (more on that later).
Let’s understand how the Cosplay Token platform will work:
- a “Player” (artists such as cosplayer, photographer, prop makers) will purchase COT at the exchanges.
- By putting his COT tokens in a reserve inside the platform, the “Player” will be able to create his own and unique token, this new token will be know as CPC, however each participant player will have his own CPC token named as he wants (ex: Yoshi Kawasaki could issue his own token called YKC, Yoshi Kawasaki Coin).
- a “User” (fan, sponsor, etc) will also purchase COT at the exchanges, and using that COT he will be able to purchase any “Player” unique CPC coin.
- The “User” will have access to exclusive content for that “Player”, by either holding a specific quantity of that player’s CPC, or by spending CPC on content (This will be defined by each “Player”, if he prefer his fans to either hold or spend CPC, its up to him to decide).
- “Users” can still trade different Players’s CPC inside the platform with themselves as they wish, however CPC will not be withdraw-able outside the Cure World Platform, just COT.
- “Players” can still generate more of his own CPC tokens by putting more COT tokens on the reserve.
A major unique difference in the way this platform will work is that the CPC tokens will be a Smart Token, this is something borrowed from the Bancor protocol.
Explaining it in a very simplistic way how a smart token works, it means the more COT the Player puts in his reserve, the higher the price his own CPC will become, and more CPC will be issued. The opposite will also be true, if the Player withdrawn COT from his reserve the price of his CPC will go down and so does the total supply.
This goes against the market logic of higher supply lower price, lower supply higher price, but I guess the reserve makes up for the collateral of the Smart Token system.
Note that, the Cure World Platform or it’s tokens are not in any way connected to the Bancor platform or BNT. They just borrow the concept of the Smart Token mechanics. The examples in the whitepaper are also very confusing since they use ETH/BNT pairs, and the data doesn’t make sense (ex: 1 BNT = 10 ETH).
I found a much more clear and simple to understand Smart Token example, it also uses ETH/BNT pairs but the data is more clear.
As we can see, this Platform is a little more complex then what it looks like.
The team
The team behind this project also created the Cure World Cosplay community, they claim to be World’s Largest Cosplay Platform, with over 720,000 members. The team is also very involved in the cosplay community and attend several cosplay related events.
I tried to find out whether their claim is actually true and I found another website that also claim to be the World’s Largest Cosplay Platform, and that is cosplay.com
Comparing both websites at Alexa I see that Cure World Cosplay does in fact have a far better Global rank, I did not find other cosplay community websites that could top it.
The team is based in Japan, and this is important since it’s the country with the most influential cosplay culture and home of one of the largest cosplay communities.
It’s also very important to pay attention to the Platform’s Ambassadors, who together have around 1M subscribers in their social media. This could greatly benefit the token’s short and medium term prices, I expect even more Ambassadors to join this project in the months to come.
Quick Analysis of the Market & Competitors
Cosplay events and the community keep on growing evrey year, and that reflects the revenue and sponsorship for the players.
Cosplay lovers were estimated to spend $17.8 billion on costumes worldwide in 2017, according to Shanghai-based research firm CRI.
Thirty percent of cosplay fans report spending between $100-$200 per costume, Rosenberg noted in her research paper Expressions of Fandom. Meanwhile 24 percent spent between $200-$400, and 13 percent said they spent $400 or more.
source: CNBC (Reuters)
The main competitor for the Cosplay Token platform is Patreon, a sponsoring platform that is already used by several cosplayers and also allows sponsors to have access to exclusive content.
However Patreon takes around 5% operation fees, and that does not include other extra fees charges by PayPal, and the Credit Card companies.
Fees seen to be a major problem on the Patreon platform, specially with small transactions.
In comparison, Cosplay Token Platform will not charge any operational fees, this is something I personally asked Junichiro.
Token Usage & Value
The use and value of the COT token is a valid one, since players who wish to issue their own CPC tokens will need to purchase COT and hold it in a reserve, and users will also need to purchase at the exchanges.
Players will likely sell some the COT they receive from the users, but they will still need to hold some COT inside the reserve for the sake of their own CPC token’s value.
As more Cosplayers and Fans start using this system the token value will continue to rise.
ICO Details
3:00pm April 1st 2018 to 2:59pm May 2nd 2018 (UTC+0)
40% of total Tokens will be available for sale, Ethereum only, as of now the whitepaper lacks many details about the ICO sale.
Pros & Cons
Pros:
- Cosplay community is young and more prone to embracing technological changes. (this is my own opinion)
- Ambassadors should play a significantly role getting this token value to grow.
- Lower fees then Patreon, this is a big plus since many cosplayers could switch to Cosplay Token.
- Very large world wide community, in which the team is also involved.
- Token will be part of a already established platform.
Cons:
- Cosplayers need to pay first before they can issue their own CPC tokens and earn money, this should not be a problem for Cosplayers with a large established fan base but it’s quite bad for smaller cosplayers who are at the risk of losing money if they overestimate their own fan bases.
However I see that this platform will have another type of payment is the form of a “Tip token”, whose concept is still being drafted by the team and lacks detailed information as of now, perhaps this new “Tip token” will benefit better the smaller cosplayers before they spend their own money to issue CPCs.
- Lacking documentation, the whitepaper lacks fine details, the examples given with Bancor are very difficult to understand and it mislead the readers to think Bancor is somehow connected with Cosplay Token.
- Completely lacking ICO details, no soft or hard cap information, it doesn’t mention if tokens will be burned, if team tokens will be locked, it doesn’t even mention the fact it’s ERC20.
Final thoughts and Verdict:
Whatever I see a Token created for a specific community, group, or market sector, the first thought in my mind is whether that specific community is even ready to embrace such technological changes as cryptocurrencies, if somebody tried to create RestaurantCoin and tried to get restaurant owners to use it the chances of it happening are quite low for guys who already over +20 years in that industry, who just recently started to learn about Bitcoin, why would they switch to that if they have been using cash and CCs for decades and it works without any risks, the clients would also ask themselves why go to the trouble of exchanging their cash for some “virtual and risky money” when they just want to eat out? The same can be said about several other coins trying to enter already well established business where people are slow to changes.
However, in the case of Cosplay community, in my very own personal opinion, I believe they are much more likely to accept and embrace new technological changes, since they are younger and are also connected with Pop culture, video games, computers. So I think a high usage and acceptance of COT token can be achievable based in the community demographics. Besides, wouldn’t it be really cool for them to be able to own and trade a token generate by your favorite cosplayers?
So my verdict is this is a Hidden Gem ICO that have a very good chance to hype in it’s own community in short and medium term. I just hope the team will be able to use that gained momentum for the long term run.
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Disclaimer: I’m a amateur investor not a financial adviser, the purpose of this review to give a second opinion about this ICO from my own research and perspective, use this as a second opinion and always do your own research before committing your money into any investment including this one.