Remechain to put scrap metals trading on the blockchain
Latest posts by Dean (see all)
- Graft ‘payment gateway’ blockchain goes live - January 19, 2018
- Leading European exchange EXMO announces token sale to fund expansion into margin trading - December 28, 2017
- ModulTrade ICO: smart contracts for global B2B trade - December 23, 2017
Remechain is a Russian start-up aiming to increase the efficiency and transparency of the global secondary metals market through the use of blockchain technology. They will do that by consolidating the fragmented trade between small and medium sized enterprises through a new smart contract based exchange platform. This will bring competitive advantages and allow these businesses to compete more effectively with larger enterprises. In order to fund the creation and business development of this innovative platform, the company is running a pre-ICO token sale in November 2017 and a subsequent ICO from late January to February 2018.
Why Remechain is needed
The current market for secondary metals is highly fragmented, subjecting participants to costly inefficiencies and creating unnecessary risks for all of those involved.
The path of scrap metal products through this system often follows a long and winding road, going through multiple intermediaries on its way from source to destination. A wide range of different sizes and types of business will often be involved in this chain, from local scrap merchants to recycling plants, construction and manufacturing companies to steel plants. This trade is all conducted manually, with each firm striking individual deals with other companies with whom they have established a relationship.
The lack of a standardized system for the classification of secondary metals or a unified market for determining common pricing means that negotiations at each step of this journey can be long and arduous. It may also open companies up to the risk of purchasing goods which are not precisely as they had expected.
Even just finding the right company to do business with can be difficult under these circumstances. Without a single source to find the right counterparty, according to geographic location, amount and type of scrap required, firms must rely on their own individual networks of trading partners and must spend valuable time calling around.
It was this lack of a common market and standardized classification system which led the Remechain team to launch the Lominfo.ru website in 2015. This Russian scrap metals market helped the team to develop their fundamental business model as well as a front-end web market. But as blockchain technology has matured, the opportunity presented itself to improve their offering even further.
By developing a smart contract marketplace for the trade of secondary metals Remechain can offer a solution to the problems described above. This is achieved through an optimized search function for finding and contacting trade partners, combined with a standardized quality assessment methodology. Meanwhile, the open transaction history of the blockchain provides the perfect foundation for a transparent and reliable reputation system of the kind which has previously not been possible within this industry. And with the addition of smart contracts, an escrow system can also be added to eliminate the risk of companies failing to fulfil their delivery obligations as agreed.
This escrow system protects buyers from a range of risks in a very simple manner. Once both sides of the trade have agreed on the terms, the customer is able to convert fiat money into the platform’s native RMT tokens, which are then locked into an Ethereum smart contract signed by both parties. If the terms of the trade are concluded as agreed by both sides, then the buyer is able to release funds to the seller. If the seller fails to deliver then the contract can be triggered to return funds to the buyer.
Summary of Advantages
The Remechain platform will therefore offer the following fundamental advantages over the status quo:
- An open global marketplace: Consolidating a fragmented market to provide a single interface and data source covering a large proportion of market participants. The use of cryptocurrency also offers easy international payments and open access regardless of location.
- Transparent data: Moving information about reputation and business history from silos within individual firms to an open platform which anybody can access.
- An international supply and demand map: Useful for firms seeking to assess availability of raw materials and to locate appropriate regions for new business development
- Logistic support: The platform will help to find optimal routes for product which must travel long distances and pass through multiple intermediaries.
- Simple and low-cost market entry: Simply registering on a single platform serving as a ‘one stop shop’ reduces the high costs currently involved in researching markets and developing partnerships.
- Elimination of non-delivery risk: Through the use of the escrow system described above.
Tokens and ICO sale
In order to maintain a smooth and efficient user experience for businesses wishing to pay in fiat money, but still take advantage of the inherent qualities of cryptocurrency there are three native tokens within the Remechain platform.
The RMC token is the medium of exchange within the platform. They are issued by the marketplace itself in the amounts required for the settlement of transactions.
RMCk tokens are linked to supported fiat currencies supported by the platform. They maintain selected positions in the relevant currency and are issued when a buyer makes a fiat deposit to Remechain.
Together these two tokens maintain a smooth link between fiat and cryptocurrency and enable internal transactions within the platform. For the full details on how this system will work in practice you can take a look at the whitepaper here: https://remechain.io/Whitepaper_eng.pdf
A third token known as iRMC is unlinked to the previous two, and serves only as a dividend token to share profits with investors. Customers will not need to use iRMC tokens and unlike the other two tokens the supply of iRMC will be fixed. Investors may purchase iRMC during the pre-ICO and ICO crowdsales.
Dividends are paid in the form of regular token buybacks.
The pre-ICO token sale began on 9th November 2017 and will run until 25th November. During this phase 600,000 tokens will be made available to purchase. The cost per token is $1, however early investors who get involved at this stage will enjoy a 20% bonus on the number of tokens they receive.
Following on from this on January 25th 2018 the main ICO sale will begin. The price will be fixed at $1, and 6,000,000 tokens will be made available to purchase. This will last for one month, closing on 25th February 2018.
For more information about ReMeChain and its ICO sale please take a look at the website here: https://remechain.io