DREP ICO Review And Token Analysis

DREP ICO Overview

The DREP ICO is offering the DREP token to raise funds for a decentralized reputation network comprising a public chain, reputation-based protocol and tools for integrated online platforms (DRApps).

DREP (it stands for Decentralized Reputation System) aims to quantify and tokenize the value of user reputation for online commerce, investment and data sharing. Through tokenized restructuring of online value systems, DREP aim to leverage blockchain technology and create a new paradigm for the exchange of data, goods and assets, where reputation sits firmly at the center.

*NOTE – if you intend to participate, the whitelist closes on June 30th*

DREP ICO Value Proposition

DREP Foundation proposes a pathway to the creation of a decentralized reputation ecosystem through their layered solution. DREP rests on the proposition that internet reputation is an untapped source of value that, when properly quantified, can provide a higher-quality, interconnected digital community, from which both online services and users stand to benefit.

The long-term vision of the DREP is to establish a cross-chain network of DRApps, which all operate via an the interwoven reputation system. DREP Foundation have chosen to build their own their platform, including the base protocol layer, the DREP Chain, from the bottom up.  

User online reputation is based on their behavior, which is quantified and algorithmically assigned a value in tokens. Reputation becomes a means to buy and sell services, trade digital assets and prove identity across an ecosystem of online platforms. The solution proposed by DREP includes the following components:

  • An infrastructure network to support the reputation system
  • The Reputation Connector, comprised of a data sharing pool and cross-chain protocol
  • The Reputation Accelerator, comprised of the User Growth Engine and Traffic Realization Engine for small and medium-sized DRApps
  • A reputation-backed digital asset and reputation-backed currency
  • The Hub for Reputation Data

The DREP ecosystem includes both a reputation-backed asset (DREP) and reputation-backed  currency (REPX). Initially the DREP token economy will only utilize DREP tokens, which reflect the reputation value of a user. DREP will later introduce the stable coin currency, REPX, when an unspecified amount of reputation data is accumulated and accounts are verified through a third-party KYC process.

Each DRApp can also issue its own token via the native smart contract template called RepToken, which will be ERC20 compatible. According to the whitepaper, for DRApps where the demand of tokenization is greater than that of decentralization, DREP will be the only form of payment and means of value transaction.

The core attribute of DREP token is tied to user reputation value. User reputation value is determined through active participation and contribution to the DREP network, for which tokens are rewarded in return. Subsequently, the tokens can be used to execute transactions on the network as gas or used to pay value-added service fees on user information pools or the integrated commerce platform. The REPX token, when deployed, will act as a stable currency to support the DREP token. REPX will then provide the underlying currency for value, payments and transactions within the ecosystem. DREP will initially be issued as ERC20 token.

 

 

DREP ICO Team

Xiaolong Stephen Xu has spent nearly 2 years as a lead developer with Qtum Foundation. Prior to joining Qtum, he spent 3 years as a Software Engineer at Tenecent. He holds an MSc in Computer Science from the University of Chinese Academy of Sciences. 

Matt Bennice has 4 years of experience at Google as a Software Engineer. He has an additional 8 years of management experience with Accenture. He currently works as a Software Engineer with X – The Moonshot Factory, a semi-secret research company founded by Google. 

Momo Zhang spent 10 months as a Securities Analyst for Orient Securities before co-founding DREP. She’s also had various stints with investment companies in Hong Kong and Mainland China. She holds an MA in Finance from Nanyang Technological University.

Among the list of advisors to the DREP ICO is Siaou-sze Lien. Siaou-sze spent 28 years of her business career with Hewlett Packard, rising to the position of Senior VP. During her time with Hewlett Packard, she was ranked 3 years in a row on Fortune’s top 50 women in business.

The full list of team members and advisors can be found here.

DREP ICO Strengths and Opportunities

The DREP Foundation has announced two partnerships with online platform startups and are also incubating the network’s first DRApp. The first online platform is Comebey, a discount lifestyle website in the UAE. The site displays no traffic data on Similarweb, and Google Play indicates the app has received 500+ downloads.

The second partnership with Ziggurat, a decentralized intellectual property certification startup based in China. The DREP Foundation is also incubating Blockbate, a platform for hosting online discussion and debate, which will be one of the first DRApps on the network. Participants on the platform can gain economic incentives through engaging in discussions and sharing opinions.

DREP ICO Weaknesses and Threats

Reputation-based ICO projects have not performed well in previous instances. Ink Protocol, one of the better known tokenized reputation ICO projects, is down 85% from listing price at the time of publishing. The use utility of a reputation token will rely entirely on either integration with an existing ecosystem of large online businesses or an extensive ecosystem of dApps.

As of yet, no reputation-based token project has found adoption with existing networks of online services, and mass proliferation of dApps has yet to take off. To incentivize adoption, the team have reserved 40% of their tokens for onboarding existing platforms and spreading awareness of the project.

This distribution scheme leaves open the possibility that almost half of the total supply of DREP tokens can enter the market at anytime through incentivization schemes, with no guarantee enterprises will actually enter the ecosystem.

The core economic attribute of the DREP token begins with assigning users a reputation value. Users will then receive tokens, in the form of contribution rewards, through “social mining”; i.e. active participation and contribution on the DREP network. Subsequently, the tokens can be used to execute transactions on the network as gas or used to pay value-added service fees on the user information sharing pool and integrated commerce platform.

However, some DRApps will use DREP as the underlying token and some will not. With the RepToken smart contract template, DRApps can alternatively choose to issue native ERC20 tokens on their own. When REPX tokens are released into the ecosystem, they will become the underlying stable currency for transacting value. As REPX won’t enter the ecosystem until later in its maturation, this could in theory remove a major function of the DREP token utility as a means to transact value.

Through the issuance and circulation of DREP, REPX, and an unknown number of native DRApp tokens, the network valuation of the DREP ecosystem will not be exclusively tied to the DREP token.

As the DREP Foundation plans to target major websites for integration, the prospect of user base transition to a tokenized model, let alone one that involves multiple tokens at different junctures in the ecosystem, is highly improbable at this early stage in the development of the crypto-economy. Adoption by mainstream enterprises will unquestionably require users not only understand, but willingly support incorporation of a rather complex tokenization system.

For online platforms that already have profitable, efficient revenue models, transitioning to a new system makes little sense.

The Verdict on the DREP ICO

The DREP ICO aims to build an entirely new, layered blockchain architecture from the bottom up, based on a multi-token system. Once this architecture is ready, the focus will turn to building a network of integrated online platforms into an ecosystem where reputation is the core commodity.

For a project of such scope, there isn’t much evidence in the way of product development, interest from enterprise partners, or even a clear outline as to how project milestones will be accomplished to support the value proposition. Underlying all these factors, the concept of a reputation-based token system remains unsubstantiated.

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