Crypto And Banking

I had witnessed the bad economics of banking decisions impact the economy adversely. And I could see that cryptocurrency, mainly bitcoin, can help. I wanted to combine the best of both,” recalls Sajid Jamal, founder of UAE-based financial and asset management advisory company OryxPrive Investment, as he reflects on the “hatred” that he saw between the two communities.

Backed with this thought process, and eight years of experience in the finance industry, Jamal began working on a cryptocurrency business model based on investments that fostered an enabling environment for investments to grow. The result was the birth of OryxCash, in November 2017.

Jamal defines OryxCash as a venture capitalist (VC) coin that makes investments opportunities in startups and new businesses accessible to all. Opening up an otherwise closed segment would spur economic growth, he felt. “If you can help in creating the next Uber or Mac, you are creating employment opportunities,” he says.

In his pursuit of building something that could trigger a wider scale impact, Jamal was joined in by Mohammed Arif, a partner in Oryx.

The VC Coin
Jamal explains that unlike other models, the ICO (initial coin offer) is easier to raise money. “However, it is important to invest this money wisely. Investing in startups was the natural next step for us,” he adds. This overall business model made India an important market for OryxCash. Apart from India, OryxCash’s target regions include Southeast Asia, Middle East and Africa — the common thread being a vibrant startup ecosystem.

OryxCash leverages blockchain and information technology to provide startup funding through coin issuance. Each coin represents investments in a portfolio of startups, growing in utility and hence, value, as the startups grow. The decision to invest in a portfolio was to increase the chances of a positive net effect in a situation, if any of the invested startups did not grow as per expectations.

OryxCash’s vision is to solve the seven-pronged hitch in individual investing including visibility, liquidity, high investment limits, no direct access and technical concerns for individual investor, and inflated values and hype in revenue model while holding principle.

“When startups make money, OryxCoin will be mined for those profits and will be paid in the form of dividends in OryxPay Wallets. The investors will have liquidity to sell the coins peer to peer or in the exchanges,” says Jamal.

OryxCash aims to have 250 million coins over a period of 10 years. Out of these, funds raised through sale of 35 million coins will be used for investments that either fill in the missing pieces towards the interconnected value chains that Oryx aims to create from a utility viewpoint, or are out of the box investments.

Bringing In The Experts
A key element to ensure the success of the coin is to invest in startups that will grow. OryxCash has created a due diligence process for this. “We have signed an agreement with Grant Thornton which would vet processes and assist in analysing startups. On the legal side, we are bringing in Pillsbury Winthrop Shaw Pittman. Right now, our process of fund raising and investment is vetted. Next, the investing company will also be looked into,” informs Jamal.

OryxCash is working toward patenting its business model. “Government too can use this model to create an alternative digital currency, saving 4 per cent of its GDP that can be used to invest in new projects,” says Jamal.

The concept of a second digital currency created under various government investment silos will result in natural valuation of the coins, while raising money from within the country.

Interconnected Ecosystem
“The value of the coin will be derived from the investments in, and the performance of the portfolio,” says Arif. To that effect, the coin will have its own balance sheet. “The value will also be derived from its utility. We are working at several levels to ensure acceptability, usage and demand for the coin,” he adds.

Oryx wants to be a strategic partner to the businesses it has invested in. The creation of a value chain of interconnected businesses is part of that approach. Some of the startups that OryxCash has identified include Fresh To Home, ModulTrade and LoadMe. Arif explains that while Fresh To Home begins at the seller’s level, reaching out to farmers and fishermen, ModulTrade is a trade finance mechanism using blockchain to eliminate middlemen, and LoadMe operates on a model that brings in efficiencies in transport. With this, OryxPay eventually completes the payment loop.

“We have identified businesses that fill in the missing pieces for cryptobanking. Technology is allowing a farmer in India to sell his produce to his end consumer directly without any hurdles,” Jamal remarks, adding, “Our investments are interconnecting several startups. We can apply this model to other segments and markets.”

Investing in interconnected startups will not restrict OryxCash from investing in sectors such as sports, food and beverage, media and entertainment including music to tap on growth opportunities.

The Road Ahead
Apart from identifying companies to invest in, among its next steps, a critical one is educating people about the coin.

“OryxCash is a long-term asset and OryxCoin is an organic coin that is mined as and when OryxCash shows upside to the investment and has utility attached to it, and hence a price. An education drive, especially to explain why this business model works and cryptocurrency can be relied on, is imperative,” observes Jamal.

Government regulations will be another challenge to contend with. “We are not regulated at the moment, but we are making sure that our process is regulated by bringing in right strategic partners on board. There are challenges ahead but as a concept matures, it evolves to become a perfect model for battling any concerns and ensuring wide acceptance,” says Jamal.