VELO Live AMA with Shin Chan ICO/IEO community recap
On 19th October, we are glad to have Michael Cowans (Velo Labs Commercial Advisor) with us here at the Shin Chan community channel. Here’s the summary for those who missed.
Hi, Mike here! Thank you for the warm welcome! I am Velo Labs’ Commercial Advisor. it’s a great pleasure to be here with the Shin Chan Channel!!! I’m excited to be answering your questions about Velo Labs, the Velo Protocol, and pretty much anything you can throw at me!
As for my role with Velo, I act as a Commercial Advisor working with the Velo team on growth, commercialization, and adoption strategies.
Velo Labs is building a federated credit exchange network, powered by the Velo Protocol.
The Velo Protocol is a financial protocol comprising a Digital Credit Issuance mechanism, and a Digital Reserve System. The Digital Credit Issuance mechanism issues digital credits pegged to any fiat currency.
The Digital Reserve System ensures that these digital credits are always collateralized by the right amount of VELO tokens to maintain a 1:1 digital credit to fiat currency value ratio.
We listed the Token in late September, and are hard at work on completing the development of the Velo Protocol.
By the end of Q4 2020, we expect to release the Mainnet, wallet, and dashboard.
Beyond that, we have some upgrades planned for the Digital Credit Issuance mechanism and Digital Reserve System. As well, the Velo OTC and Velo Decentralized exchange. Lots of exciting developments in the pipeline!
Q1: As Staking is Becoming Popular, Is there any plan to Comeup with it?
& What benefits they will get?
We are having internal discussions about the advantages and disadvantages of different kinds of staking programs. I can’t announce anything at the moment but it is something we have and continue to think about.
Q2: Why did you choose Band as your oracle instead of Chainlink or DIA?
The score of the partnership with Band Protocol is:
Band Protocol will bring real-time FX data oracles to support the Velo Protocol Band Protocol will integrate decentralized VELO token price data oracles. We chose Band as we felt it most closely aligned with our strategic direction
Q3: Are you more focused on a top-down or bottom-up strategy? By that I mean are you initially targeting smaller local businesses (thinking like individual Western Union branches) to build up a base and then work your way up? Or are you focusing on larger banks and businesses first and letting them expand down to the masses?
We’re certainly starting with a top-down approach as we’re working with a network of partners and operators to become “Trusted Partners”. Our investors, backers, and partners are also very entrenched in the fintech space.
We think starting with a top-down approach allows us to reach markets and users much faster and more efficiently.
Q4: Why should we believe that Velo is more likely to succeed than any other similar project?
Using the Velo Protocol, trusted partners can put forward VELO tokens to issue digital credits pegged 1-to-1 to any fiat currency. I believe it is more likely to succeed than other digital credits or stable coins because the Velo Protocol solves three issues that plague the adoption of such projects:
-A lack of transparency
-Inadequate regulatory compliance
Another major reason stems from the VELO token’s unique trait as a “bridge asset.” VELO tokens link the values of various traditional assets to corresponding digital credits. In this way, VELO tokens can serve as a vehicle to transfer liquidity and value onto the Velo Network. As the Velo network accepts more types of assets as collateral when issuing digital credits, the VELO token bridges the gap between all asset types guarantees the value and liquidity of digital credits, and acts as the Velo Ecosystem’s universal collateral.
Q5: So from the white paper Velo Tokens is built on stellar, what happens when a partner puts in 100k USD worth of Velo tokens but the price of Velo tokens move up? are they just gonna receive 100k USD?
As the VELO token itself is not a stablecoin, we can expect that its price will fluctuate slightly in the open market. When this happens, the Digital Reserve System will automatically adjust the number of VELO tokens backing the issued digital credits. In your example, adjusting the number of VELO tokens backing the digital credits ensures a stable 100k USD value.
Q6: How do you overcome the Threat of CENTRALIZATION
While we are building a federated credit exchange network, there are no artificial limits placed on the number of entities that can become Trusted Partners. As more partners join the Velo ecosystem, it will become increasingly decentralized
Q7: What do you see to accomplish the goals for this year even it is only left two months?
The next few months promise to be extremely exciting for Velo Labs and the Velo Protocol. In Q4 alone, we plan to finish testing on the Testnet, release a native wallet, and launch the Mainnet. I’m sure you won’t be disappointed!
Q8: Why does VELO still use Ethereum blockchain while it has a slow speed and high gas fee? Do you have any plans to launch your mainet or convert to other blockchains in the future?
VELO is not on Ethereum. The VELO token is actually issued on Stellar!
Q9: As Education for the cryptocurrency is necessary nowadays, what’s your plan to attract those people who don’t know about cryptocurrency?
You’re absolutely right. Education on digital currencies is a particularly tough path. But our goal with Velo is to actually integrate into and improve upon an already existing financial network. If we do our job right, the end-users shouldn’t have to notice the blockchain or digital currencies at all. I think this seamless transition is what companies should strive for. They will however notice it is much faster/cheaper :)
Q10: The huge amount of tokens, is this an indication of the size of usage you expect? Also, what are the legal implications of credit issuance, cross border reserve requirements, etc.?
A large number of tokens is to future proof the system. Decisions relating to total supply now can’t be undone later, after all. One factor why we landed on this total supply is because we are tackling a huge market. Remittance and trade finance moves billions, if not trillions, of dollars per year. Because of this, we feel that the total supply of tokens is justifiable — especially considering our lofty goals and expectations.
Q11: In the bad situation of the Covid-19 epidemic, every industry was heavily affected. Does it affect the growth of your project team and it's?
The COVID-19 pandemic has certainly slowed many industries around the world. But the Velo Labs team is very global and hundreds of team members are spread out all around the world.
As a fintech company, the pandemic has actually had very little effect on development and business, as our teams all know their roles and we communicate remotely just fine.
Q12: What’s Velo actually is? Is it stablecoin or anything else?
I’m glad to see this question! The VELO token is not a stablecoin. Indeed, the price of VELO tokens can fluctuate on the open market. The Velo Protocol allows partners to put forward VELO tokens and issue digital credits pegged to any fiat currency.
The VELO token itself is what we call a “bridge asset.” It links the values of various traditional assets to corresponding digital credits. It also acts as universal collateral for the entire Velo Ecosystem. In other words, because partners need VELO tokens to engage the Velo Protocol, VELO tokens back every digital credit transaction, thereby guaranteeing settlement.
Q13: Can you talk a little about regulations in Southeast Asia? Do you find it easy to operate there, and are businesses/banks/governments “playing along”?
Regulatory jurisdictions move at different paces around the world. This is to be expected as different jurisdictions will have different opinions on how best to ensure the stability of markets and to protect their populations from risks. That being said, there are several jurisdictions in Southeast Asia that are actively working towards generating frameworks to enable the growth of digital assets. The team at Velo Labs is ideally positioned — and have the necessary skills — to remain abreast of all the latest developments. I personally believe Southeast Asia boasts some of the most digital-asset-friendly jurisdictions in the world. Any project that is seeking regulatory compliant mass adoption can’t ignore Southeast Asia.
Q14: What are the advantages and disadvantages of $VELO tokens when using a stellar network?
Because the VELO token is issued on Stellar, it benefits from several of Stellar’s advantages. These include but are not limited to the fact that Stellar is open source and interoperable. Stellar also enables us to conduct a huge number of transactions at a minimal cost. Stellar fees only amount to about $1 for 100,000 transactions. This will allow us to scale up and accommodate our mass-scale service needs.
Stellar enjoys a strong ecosystem of partners, or “anchors”, who provide access to many corridors for cross-border payments. Leveraging this ecosystem can help cut the operational costs of holding pre-funded accounts around the world.
These are just a few of the benefits that Stellar offers to projects like Velo. Beyond these, I think it is just as important that one of Stellar’s code focuses — to provide financial services to the unbanked and underbanked populations of the world — is very much in line with our own mission. The importance of this kind of alignment can't be overstated.
Q15: What makes investors and users feel safe when working with #VELO?
One of the unique functions of the VELO token is its role as a “bridge asset” linking the value of traditional assets to digital credits. This allows the VELO token to serve as the Velo Ecosystem’s universal collateral. Investors and users can feel completely secure when engaging with the Velo Protocol and issuing digital credits. Not only does the VELO token protect network participants from the default, but it also minimizes the likelihood of over-collateralization scenarios.