Crypto FinTech Disruptors of 2018: 0x & Metal Pay
Metal Pay (“MTL”) and 0x (“ZRX”) are two emerging FinTech projects that are set to massively disrupt the crypto-asset ecosystem.
Let’s examine the current conditions and then delve into why each of these projects are poised to solve major pain points.
Decentralized Exchanges — 0x (“ZRX”)
In recent weeks there have been a number of hacks on high-profile exchanges. Such hacks are nothing new to the crypto community, the most infamous of which was the hack of Mt. Gox back in early 2014.
This is a trend that I personally expect to continue as crypto-asset values rise. Centralized exchanges are the holy grail for hackers, who can escape with hundreds of millions of dollars in assets in an instant.
Isn’t it ironic that the assets of a de-centralized future are currently facing a centralization problem?
Fortunately for the crypto community, Decentralized Exchanges (“DEX”) appear to be primed for mainstream adoption. Unlike their centralized counterparts (ie GDAX, Binance, Bittrex) which have a singular point of attack, decentralized exchanges alleviate this issue by allowing for peer-to-peer trading on a distributed ledger.
There are several decentralized exchange crypto-assets emerging, including: Waves (“WAVES”), BitShares (“BTS”) and my personal favorite 0x (“ZRX”).
0x is an open protocol that allows for decentralized trading of Ethereum ERC-20 assets. The ZRX token is used to pay for trading fees on any exchange running off of the 0x protocol.
The key to 0x is that developers use the 0x protocol to build their own custom exchange apps. One such example of this is “Radar Relay”, an incredibly easy to use decentralized exchange that integrates directly with any Ledger hardware wallet. For any experienced crypto trader, you will find such developments intriguing to say the least.
By effectively cutting out the middleman, decentralized exchanges will save users significant amounts of capital that would normally be spent on trading fees to a centralized platform. Additionally, since trades are made peer-to-peer and the users control the funds, the entire process is much more secure for all parties involved.
Banking & Payment Processing — Metal Pay (“MTL”)
Turning fiat currencies into crypto-assets is a downright nightmare for users in the US.
In the past few weeks alone, numerous banks and credit card processors have blocked purchases of crypto-assets on popular US exchanges. Putting aside the absurdity of not being able to spend your own money on something legal, this presents a real opportunity for the company who can solve this enormous pain point.
Enter Metal Pay…a new gateway for fiat to crypto transactions.
From the Metal Whitepaper:
“Metal is a blockchain-based system utilizing Proof-of-Processed-Payments to identify users, rewarding them for converting legacy fiat currency into cryptocurrency. It is a system similar to bitcoin but with a user-friendly interface and front-end that is similar to Venmo, Square or PayPal.”
Metal, which will initially be rolled out only to US citizens, will allow for users to have a FDIC insured bank account directly on Metal. This will alleviate many of the issues faced when converting fiat currency to crypto. With a bank account, users will be able to receive a debit card linked directly to your crypto account. This will allow users to spend their crypto anywhere credit and debit cards are accepted.
The Metal Token (“MTL”) will be used as a reward mechanism to gain adoption via their mechanism “Proof of Processed Payments (“PoPP”)”. When users send money or a payment, they will be rewarded with 5% of the transaction volume in the form of MTL. Adopters will then be able to use MTL to send money to their friends, or make a purchase.
Just let that sink in for a moment….Metal will pay you 5% for all payments made. This is made possible because Metal will be able to eliminate many of the inefficiencies in the current payment processing system.
You can check out one of Metal’s demo videos here:
The sleek interface reminds me quite a bit of Venmo. This could be the killer app US crypto investors have been waiting for (Sorry Coinbase). Metal is one of the tokens I believe is poised for dramatic adoption in 2018 by bringing together a combination of value to users and ease of use.
A disciple of all things blockchain and cryptocurrency, Tom is a portfolio manager at Blockchain Asset Group, a crypto fund based out of NYC.
