Populous Review – The first project of its kind to bring Invoice Trading (also known as Invoice Factoring) to Cryptocurrency.
Populous have the first mover advantage in an existing and gigantic industry worth $3 Trillion per year. With their truly disruptive business model, Populous have been gaining incredible traction recently as investors have woken up to the true potential of the project.
In this article, we’ll be giving our 100% honest review, to help you decide if this project is the right investment for you or not.
YOU WILL LEARN:
What Is The Populous Project?
Will The Populous Token Increase In Price?
How To Buy And Store Your Populous Tokens
Our Opinion On The Populous Project
- What Is Populous?
- How Does Populous Work?
- Are Populous Solving Real Market Problems?
- Will Populous Tokens Increase In Value?
- Team & Roadmap
- Selling Points
- Barriers To Success
- Extra Points
- Where To Buy & Store Populous Tokens
- Is Now A Good Time To Buy Populous?
- Follow Future Posts
1. WHAT IS POPULOUS?
In Their Words
“Populous is a global P2P (peer-to-peer) invoice discounting platform built on Blockchain technology. We combine the trust, transparency, security, and speed of Blockchain with our proprietary smart contracts to directly pair invoice sellers and lenders to transact directly and without third parties.”
In Our Words
Populous is a project that allows peer-to-peer invoice trading, hosted on the Ethereum blockchain. You’re probably wondering what invoice trading is and how it can be such a huge market at $3 Trillion per year; don’t worry, we’ve explained it below for you.
What is Invoice Trading/Factoring?
Imagine you’re running a small-medium sized business. Your company carries out a job for a bigger company and they give you an invoice – a document guaranteeing that they will pay you in the future.
The problem is that payments aren’t usually due immediately – you could be waiting months for it to arrive. In the meantime, you need cash to run your business – how else will you buy new stock or pay for operating costs?
In this situation, some businesses may go to the bank and ask for a loan. However, banks often don’t give loans to small-medium sized businesses and, even if they do, they will usually charge high interest rates.
Introducing Invoice Trading
Out of this problem, invoice trading was invented – what if you could sell your invoice to someone else for 90% of its value?
This way, you might lose 10% of your invoice value, but you can continue to buy stock, pay daily operating costs etc and keep your business running. Also, the bank would have charged much higher rates for a loan, so you’ve just saved by avoiding that route too.
Why Would Anyone Buy An Invoice?
Hopefully, it’s obvious to see why small-medium sized businesses would choose to sell their invoices for a discount – it’s often the only way for them to keep their business running, we’ll now describe why you would want to buy an invoice.
Let’s say your a business which has lots of reserve funds. You could either leave that money in a bank or you could buy invoices and make profits. For example, you buy an invoice for $9,000 which has a value of $10,000.
When the invoice date arrives, you will receive $10,000; you might have had to wait but you’ve now just gained $1,000.
Hopefully, you understand what invoice trading is and why it’s such a massive industry – $3 Trillion per year. If you’re confused by our explanation, check out the very brief video below:
(They use the term ‘Invoice Factoring’ where we say ‘Invoice Trading’ – don’t worry, they’re the same thing)
Populous have just announced the planned release of their beta following a successful alpha release.
2. HOW DOES POPULOUS WORK?
The platform relies on two key categories of people: Invoice Buyers and Invoice Sellers. In its most simple way, invoice sellers list their invoices on the Populous platform for invoice buyers to bid on. The bidding process last for 24 hours and then the invoice seller makes their choice.
Think: ‘Ebay for Invoices’.
With Populous, there are 2 associated tokens which we’ll describe below and then we’ll talk about how they combine to form the overall process:
The PPT Tokens are the tokens available on the exchanges i.e. the one that you can buy if you choose.
PPT Tokens are ‘access tokens’. In other words, users must first buy them in order to be able to access the Populous platform.
These are the ‘in platform currency’ and are used to transfer value between buyers and seller. They are pegged to a fiat currency and 1 Poken is equivalent to 1GBP. Pokens can be exchanged with fiat currencies as well as established cryptocurrencies such as Bitcoin.
The Process Explained: For Buyers
Let’s say you want to buy an invoice on the Populous platform. What’s the process?
- Buy PPT Tokens from the exchanges
- Convert your PPT Tokens for Pokens which you can use within the platform
- Bid on an invoice; the higher you bid, the more likely you’ll win the auction
- If you win, you’ll pay your Pokens to the invoice seller
- When the invoice is due for payment, you’ll receive the invoice pay
3. ARE POPULOUS SOLVING REAL MARKET PROBLEMS?
Hopefully, by this point, you understand what Invoice Trading is so now we can explain the current system and how Populous aims to improve on it.
Problem #1 – The Pay
We discussed earlier how a regular invoice trading market will involve sellers offering their invoices to buyer for 90% of the value.
In the current system, 90% seems to be the maximum amount companies could expect to receive on large invoices. With the Populous system, invoice sellers should benefit from the advantage of having a greater number of buyers that are competing through the auction bidding system.
If the number of buyers is high, then it is more likely favourable terms will be offered to the invoice seller, such as 95% of the invoice value or lower interest rates.
Problem #2 – Globalisation
Currently, the global invoice trading market is mostly limited to the boundaries of your own country, or at least your continent. What we mean by this is that the majority of invoice trading involves buyers and sellers from the same country.
Note: We stress the word mostly because some international invoice trading does currently occur
While Populous will begin in the UK, over the long-term, they will be creating a global marketplace to allow buyers and sellers from around the world to buy and sell their invoices. Therefore, if you live in a country with less economic certainty where companies regularly default and are unable to pay their invoice, you will instead be able to buy much safer invoices from more economically established countries.
Essentially, the globalisation of this market should allow for residents of less economically established countries to buy much safer assets. This is similar to stock markets where you can buy stocks with various ratings.
Problem #3 – Traceable Data
With large companies, it is not uncommon for clerical errors to occur, leading to the failure to forward an invoice or duplication. In other words, human error can cause big problems within the industry
Populous’ Solution – Traceable Data
Due to the visibility of the blockchain and the fact that smart contracts will automate the majority of the process, it is highly unlikely these errors will occur within the Populous platform.
Problem #4 – Accredited Investors Only
The majority of current peer-to-peer invoice trading platforms require invoice buyers to be accredited investors
Populous’ Solution – Everyone Is Allowed
Populous do not plan to implement restrictions such as this on investors. Whether government regulations in the future will force them to, however, is yet to be seen
4. WILL THE POPULOUS TOKEN PRICE INCREASE?
This is another incredibly important point that people often overlook when investing in Cryptocurrencies – is the token price truly linked to the platform usage?
Investing in Cryptos is not the same as traditional investing – when you buy shares in a company, you’re buying ownership. As the company makes increased profits, the share price will increase and your investment value will rise also.
With the majority of Cryptocurrencies, the tokens don’t represent shares.
Therefore, it’s possible for the company to be successful (i.e the CEO and employees get rich) and yet the token prices may actually fall if they aren’t correctly linked to platform usage.
The ONLY factor determining token price is supply and demand on exchanges.
Obviously, supply and demand are affected by many factors but the price all comes down to the combination of these two. Because of this, it is essential to ask yourself the following two questions
- Demand – Will there be token demand on the exchanges?
- Supply – Will there be excessive inflation hindering prices?
Let’s first look at demand:
What Are The Sources Of Demand?
The demand for the Populous token stems from the desire of companies or persons to sell their invoices. It should be noted that there are of course a number of established alternatives in the non-Crypto so there will not be a guaranteed demand.
When it comes to the Populous platform, the Populous token is the only way to gain access; since the token is used to bid on and purchase invoices. Therefore, as more people begin to use the Populous platform, the demand for the token should rise and so would the token price.
The price of the Populous token has been sufficiently linked to the demand for the platform, meaning Populous have passed this test.
What Is The Likely Inflation Rate?
Populous created a fixed supply of tokens meaning a zero inflation rate but this does not mean that new tokens will not enter the market though. There were a total of 53,200,000 PPT created, 36,000,000 (67.67%) of which were distributed to investors. This means that there are still 17,200,000 PPT to potentially enter the market but how were they distributed?
- 12,000,000 PPT (22.56%) Team – Populous state that these tokens are locked in for a period of one year, meaning that no inflationary pressure should be felt in the short term.
- 4,600,000 PPT (8.64%) Business Development – This portion of tokens will be sold over time in order to fund operational costs etc. However, this is less than 1/10th of the total supply meaning any inflation would be beyond minimal.
- 600,000 PPT (1.13%) Promotion – These were distributed to people involved in aspects such as bounty campaigns. The percentage is so small and these participants would have already received their tokens, so no inflationary pressure should be felt.
Overall, the inflation rate should be relatively low and token demand should be based entirely on the success of the Populous project. As such, we can simply analyse whether we believe this project will be a success – while factoring in price – in order to determine if this is a worthy investment.
5. THE POPULOUS TEAM & ROADMAP
As our regular readers will know, one of our mantras here at Crypto Gurus is to “invest in people, not ideas”. It’s based off the principle that an idea is only as good as the people who execute it. As investors, we strongly believe in this principle.
A small section of the Populous team is shown above; their founder and CEO Stephen Williams can be seen in the centre. According to their website, the team consists of 11 members but little is written about them.
The first member to look at is the Populous founder and CEO Stephen Williams; his experience seems varied having spent 14 years at Tramp Magazine as a publisher, as well as founding commercial data analyst company Olympus Research.
Their only listed advisor is Shadi Paterson, he operates on behalf of a Pre and Post-ICO marketing company and has also worked as an advisor for Crypto20, a tokenized index fund.
The fact that we haven’t been able to garner too much information about the team could be seen as a red flag. To counter this, they already at the beta stage with their product so we don’t find it as concerning as we might in other situations
The Populous website and whitepaper do not provide a roadmap for the project but Populous are a lot further along their journey than many of the projects we review. Founded in November 2016, they have just announced the planned release of their beta platform, following a successful alpha release. As such we have no worries about this aspect of the project.
6. SELLING POINTS
First Mover Advantage
Invoice trading is clearly an established market but Populous are the first to venture into it from the Cryptosphere.
They should benefit from the first mover advantage as a result. When this is combined with the cost benefits mentioned above, we believe the platform should witness a reasonable level of demand from the offset, even if only out of consumer intrigue.
$1 billion deal
A further huge positive was announced by Populous in September 2017, a $1 billion partnership with global rewards platform, Luxure Global Citizens. This should ensure that PPT investors have regular access to a supply of blue-chip invoices from which they are able to earn regular returns.
Currently $1 billion worth of deals are completed yearly through Luxure and this is forecasted to rise following their own partnership with a Chinese company called Alipay.
$3 TRILLION Existing Industry
Many Cryptocurrencies are considered ‘pioneers’ in the sense that they are aiming to create entirely new industries; similar to the early days of the internet.
While this could be extremely profitable for many, it is also a much greater risk. Populous, on the other hand, are entering into an existing and extremely profitable business. If they’re able to take a decent cut of the business sector, they could have a very successful future
ENJOYING THE ARTICLE?
Hi, I’m Tom, the CEO, and I’d like to take this opportunity to personally thank you for reading our article. I hope you’re enjoying it and have learnt a thing or two.
If you have, don’t forget to bookmark the website for more great content just like this. Already done that?
Come and chat to me personally in our Facebook Group! We work hard to create a welcoming community and, when you join, you’ll be able to vote in our regular polls to see which projects YOU want us to review.
Anyway, let’s get back to the content!
7. BARRIERS TO SUCCESS
Overall, we are big fans of the Populous project but, as investors, we always aim to be as critical as possible when review a Crypto. It is for this reason that we have searched for some potential barriers to Populous’ success and highlighted them below.
The main problem we potentially see with the Populous project is one that arises with many we review and that concerns slow adoption rates; cryptocurrencies are still in the early adopter stages and face unfair negative connotations from some.
When this is combined with the number of valid alternatives in invoice factoring then Populous may find adoption of their project slower than they would like.
Readers should also be aware that there is a similar Crypto project to Populous known as Hive Project. While we believe that Populous are more likely to succeed in their plans, smart investors should consider the threat from Hive before investing.
8. EXTRA POINTS TO CONSIDER
As mentioned throughout, last month Populous announced plans for the beta release of their project. This is a huge step and signifies that the Populous project is at a great stage of development and if the beta is also a success, the sky is potentially the limit for Populous.
Early screenshots and the alpha release show the Populous platform to look incredibly sleek and simple.
9. WHERE TO BUY & STORE POPULOUS
Where To Buy Populous Tokens
Populous tokens are available for purchase on the following exchanges:
Where To Store Populous Tokens
Populous is an Ethereum-based token which means it can be safely stored on any ERC-20 compatible wallets. Our favourite option is MyEtherWallet which you can download via the link below:
10. IS NOW A GOOD TIME TO BUY POPULOUS?
There has been some internal confliction for us on whether to include this section or not; this is a static webpage so this section is really only applicable at the time of writing (hence we don’t usually include it) but, with Populous having increased so much in value recently, we thought it would be unwise not to include a warning for investors.
To quote some old yet wise investor advice “buy when there is blood on the streets”. In other words, smart investors usually move against the market and buy when everyone else is selling.
With the Crypto market as a whole, this attitude can sometimes lead to investors missing unbelievable profits. However, we like to apply this principle to Cryptocurrencies which have outstripped their competitors in recent times.
In other words, if a Crypto beats the market average so significantly over a period of time, there is a good chance that they will pull back slightly and move roughly with the market average.
In the case of Populous, it has increased nearly 3x over the past 2 weeks (December 6th – December 20th) compared to the market increasing around 2x.
We might not be expert traders (until we introduce qualified traders to the team!) but we would probably avoid buying Populous at this particular time. Instead, we are waiting for a cheap buying opportunity to present itself in the future e.g. if Populous falls outside the top 25-27 again.
The important point to note here though is that Populous is an interesting project and is on our radar.
11. THE CRYPTOGURUS CONCLUSION
We will finish with a brief conclusion to round out this article. Overall, we believe the Populous project to be a solid one; they are operating in an already established market worth more than $3 billion per year and are doing so while offering some clear improvements on the current system.
Success will of course depend on the level of adoption the platform witnesses but early signs have shown a solid level of support for the project. The fact that all tokens sold out in the pre-ICO shows investor support and the $1 billion deal signed with Luxure Global Citizens shows clear supply should be readily available for invoice buyers.
The upcoming beta release means that the Populous project is a lot further on than most of the projects we have reviewed here at CryptoGurus. However, investors should be wary of the recent surge in prices that the project has experienced.
To finish, we would say that we are big fans of the project but we would potentially wait a little bit of time for perhaps a small retracement in prices before buying
That’s the end of the article! Thanks for stopping by and don’t forget to check out our other articles for regular Crypto/ICO reviews and market updates.
Would you like your ICO reviewed? Contact Us Now
Disclaimer: None of the above is financial advice. Always do your own research.
12. FOLLOW FUTURE POSTS
Come join us to follow future articles and personally chat with us:
Facebook – Vote every 2 weeks for the reviews YOU want to see
Telegram – Join the #1 group Crypto chat
Youtube – Follow daily educational videos