Want to trade stocks, bonds and ETFs? There are many financial advisors with the experience and knowledge to assist you. Want to trade cryptocurrencies? That's another story.
Many established financial advisors won't even touch the sector for fear of the exposure it may create if trades go wrong. Yet, that leaves many who want to trade crypto assets with few places to go for help.
Based on the aforesaid, I recently spoke with Taklimakan CEO and co-founder Rashid Yussup to get a better sense of the service he is in the process of building that seeks to connect crypto investors, traders and analysts as a resource between beginners and so called "experts" in the space.
How is your platform similar or different to the way that financial advisors typically provide advice to clients with respect to more traditional investments?
Yussup: We can surely say that given mature nature of traditional investments, the service providers within those markets have been naturally selected, so that users of the services might expect highest quality of service. Nowadays, biggest financial institutions and hedge funds offer top notch advisory and asset management solutions. Cryptocurrencies on the other end do see the luck of such services. And that's why here we are to help you out.
We are doing two things that I consider very important and innovative: 1. Tools and framework for Financial Analysis in the blockchain space, and 2. Tools for quantitative approach to selecting Asset Managers. The crypto world is very young. It has grown very quickly to several thousand startups and thousands of pilot projects. A lot of people are entering it by trying to invest. However, the way most people invest in it has more in common with gambling than with investing.
Investing requires work - research, diligence and governance. But that is not done by the vast majority of crypto enthusiasts - it's just too much work, sometimes very complicated, and people rely on often unreliable social media posts and similar tools to make investment decisions. That is dangerous.
Taklimakan was built to help a large number of crypto enthusiasts to learn about investing in it and giving them the tools to do real research. We are creating a large set of analytical tools that professional analysts use in the financial world every day, that do not yet exist in the crypto space. We hope this will be the beginning of a new profession - Crypto Financial Analyst.
After we complete that part we will work on asset management solutions. Investing is a lot of work and it often makes much more sense to entrust your funds to a professional trader. But how do you decide who to give your cryptocurrency to? And when to exit? We are looking into creating some very advanced features to answer these questions, something that as of yet does not yet exist - crypto indices and portfolio performance comparisons, which will give investors a quantitative way to evaluate performance - which traders are better than their peers.
How is someone qualified as an "expert" on the platform, and what is the verification process like for such a qualification?
Yussup: When setting up, the person can register as an expert or user. But anytime later, he can switch to the other category when he thinks that he is capable to become an expert.
At the beginning, of course the expertise of the expert person would be checked internally to assure that users get acquainted only with the top notch experts. As time will go, the blockchain feature of the platform would come to the scene and determine quantitatively which user deserves to be called an expert based on a list of distinct metrics.
Who are the "experienced managers" offering investment portfolios on the platform, how are they selected and what do they receive in return for providing recommendations?
Yussup: The experienced managers within a platform would provide asset management solutions to users of the platform. We will ensure that fraudulent asset managers would not get listed on our platform. The good thing about asset management solutions in our platform is that you will not be transferring money directly to asset manager, but through the platform, so that we ensure no funds would be lost or stolen by a service provider. We somehow will be acting as the escrow agency ensuring safe and transparent interaction between investor and manager.
What made you determine that there was a need for this type of platform in the market and who are your chief competitors?
Yussup: We found projects that have embedded some of the features that we are planning to have; however, at the moment there exists no project which resembles everything at one place.
There is no platform which enables users to get access to quality analysis on ICOs and established coins and the same time rate those based on quantitative metrics. Trading signals within the platform will be assessed on a success ratio based on standard and non-standard metrics which are used in traditional assets trading. Crowd prediction features will enable users to form a consensus opinion on a specific asset. Last, but not least, an education feature within the platform will allow us to build a solid foundation for the novice investors, who just entered the market.