InsurTech-Blockchain Briefing #5: fidentiaX (incl. Interview)
FidentiaX is in the developmental phase of creating the world’s first marketplace for tradable insurance policies by disrupting the status to empower policyholders to monetise policies on the blockchain.
It will be a membership-based ecosystem focusing on the key stakeholders:
Policyholders:
Providing a liquidity alternative to existing policyholders through a transparent, fair and efficient platform which allows tokenization of their existing policies.
Buyers:
Developing a trustless marketplace for buyers exploring tradable policies as part of their investment portfolio by leveraging on blockchain technology and its benefits to provide a secured transactional ecosystem.
fidentiaX will also be setting up fidentiaX Open Source Foundation (fSOF) to proliferate the embracing of blockchain technology for the insurance industry.
I had the chance for a quick interview with Douglas Goh, Co-founder of fidentiaX:
Could you please give a short introduction about you and what you did before fidentiaX?
Doug: Greetings, My name is Douglas Goh, co-founder of FidentiaX. Both myself and my fellow co-founder (Alvin) have had a multitude of experience in the finance industry. Both of us have held senior positions within consumer banking, family office, insurance, UHNW and compliance. Before FidentiaX, I mostly traveled the world to seek out investment opportunities in disruptive companies as the Chief Operating Officer of a private family office fund. This is where the inception of fidentiaX began as both Alvin and I were convinced that distributed ledger technologies was the solution to a problem that we were tackling for a very long time. I still currently preside over an Insurtech company in an advisory capacity as the Executive Director.
What is the idea behind fidentiaX? What problem is it solving? What is the advantage of having tradable insurance policies?
Doug: The fundamental idea behind fidentiaX was to deliver market efficiencies by connecting willing buyers and sellers of tradable policies together in a global marketplace in a trustless manner. This is a multi-billion dollar industry that has no recognisable marketplace, a dependency on 3rd parties to bridge a transaction and most importantly, a general lack of awareness for the consumer population of the options available to them when they wish to surrender their policies. Most people surrender their policies when they have a financial need or when they simply outgrow the purpose of their given policy. Due to the lack of awareness, most individuals believe that the only option to liquidate their policy, is to surrender to the original insurer. In which most cases may not be the most financially beneficial option for the seller. There is a given population (who are in the know) that purchases tradable policies as an asset as the returns are highly attractive as an asset class as well. Our core purpose is to enable distributed ledger technology to create an amazing user experience that is trans-border, efficient and secure.
The fundamental idea behind fidentiaX was to deliver market efficiencies by connecting willing buyers and sellers of tradable policies together in a global marketplace in a trustless manner.
How does your fdX token come into play?
Doug: There are 3 main utilities for fdX tokens:
A: Membership — fidentiaX is a membership-based platform whereby users need to be a member to access the range of services available on the platform. The annual membership fees shall be payable via fdX tokens and any token collected will be consumed. This would effectively decrease the total float of fdX in the market.
For example: fidentiaX’s marketplace has 200,000 users and each membership is set at 20 fdX tokens per annual. A total of 4,000,000 will be consumed that year. This will reduce the total float by approximately 3% assuming 100% of the tokens were distributed during the CIO.
B: Member’s Auction — fidentiaX will hold exclusive auction for fdX token holders whereby policy will be put up for auction at a significant discount off the cash value.
For example: fidentiaX list an endowment policy with cash value of $100,000 at 25% discount, i.e. $75,000. Holders of fdX tokens would then be able to place a bid on the policy using fdX tokens. Successful bidder would walk away with a substantial discount for a real-world asset which he could put up for sale in our marketplace.
C: Exchange for Platform Unified Token (ISX) — Transactions on fidentiaX platform will be conducted with a platform unified token (ISX) for better management of forex risk and risk management (Anti-Money Laundering). fidentiaX will hold exclusive and limited sale for fdX token holders, giving them the opportunity to purchase ISX tokens at a discount. ISX tokens are pegged to US$1.
Due to the lack of awareness, most individuals believe that the only option to liquidate their policy, is to surrender to the original insurer.
What is your roadmap? What will be next?
Doug: Our ICO finished a month ago and whilst we did not spend a huge amount of resources on marketing, it has been really encouraging how our community has grown organically. We are finish with our first phase of recruitment and this will allow us to broaden our community outreach, develop strategic partnerships in the insurance space and most importantly, deliver our prototype within Q1 of 2018. There will be a lot of new developments and progress that we will stage sequentially as we work towards to deliver a first of its kind insurance marketplace with our community.
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