BitCar and its future
Crypto Finder sat down with Charles Kilborn of BitCar, a blockchain platform that allows traders to own shares in luxury cars.
Charles Kilborn, who is responsibile for International Engagement at BitCar, talks about what it is, how it works, who its customer is, the current stage of development and the future.
Interview from Blockchain Week London. 23rd January 2018.
Read the transcript:
How does BitCar work?
It's actually one of the reasons that I got most interested in this project, because I am working with the founders who are, as most people have heard by now, the same founders who launched Power Ledger – which is quite successful.
This platform was developed for both of these projects and so we were able to come out of the gate running a little bit more. And this has sort of a unique token economy to it.
There is an outer-lying utility token, and that token provides a buyer or a user access to the actual platform. And in the platform will be this sort of array of assets which will be the vehicles and the assets are tied to a token.
When a registered agent buys these vehicles they will fractionalise them. They'll tokenise these assets and their title on the blockchain.
And they'll provide an array of ... Just to make it easy math, if it was a million dollar vehicle you could have a million tokens. There will be a conversion rate where you will use your utility token to buy the asset tokens. You would go into your virtual showroom and select your Enzo or your LaFerrari, and you will use your utility token to purchase that.
This creates a very dynamic relationship with the economy because, as you use the utility token to purchase the asset, you are creating a demand restraint. You're taking supply out of circulation which creates inverted pricing pressure. Conversely, by consuming the asset tokens, you're taking asset tokens out of circulation.
And there are some other advantages as well because we're taking cars out of circulation for a minimum of five years.
So that will put some pressure in the market, aside from the fact that we're bringing loads of people into this market that weren't typically buyers before. That will hopefully create some pressure on the demand for the vehicle as well.
And are you buying a percentage share in a car or are you buying the upholstery or the steering wheel?
Probably the easiest way to imagine it is if you were to take the title of the car and to fragment it into its bits, and you own a piece of the title of the car.
You own a piece of the entire car. You can mentally sort of adopt it however it works for you, but you would really own a piece of the title of the vehicle. You could buy half the car, you could buy a third of the car, you could buy $50 worth of the car really. It's based upon the user's desire and level of interest in ownership.
So you can break it up into as many pieces as you like?
Who's your customer?
That's actually a really good question. The predominate customers are the folks in the middle market who don't typically have access to these types of assets.
Although, we have also gotten significant interest from those folks who actually currently own these vehicles – those folks who have spent years and years and years in that market have realised the economies of scale business model that this is. And this allows them to fractionalise the expense of carrying these vehicles, so they have a strong interest in converting some of the inventories.
The owners have spent a lot of years developing an applied algorithm to make very specific decisions about what cars to buy, what brand, how many were manufactured, what was the engine style, what's the model type, and what's the demand in the market at the time it was purchased. Many factors go into making that decision because we want to buy the right vehicles.
And what stage are you at? Are you live?
We've already developed a platform, and tested the platform.
One of the advantages of having founders that also developed Power Ledger is that right now we're sort of gaming up the piece that allows the user to trade their asset tokens with other tokens.
So an owner could say, "Hey I want to trade my LaFerrari token for your Enzo token," as an example. That piece will be wrapped up in the coming months. We look to have the assets come live on the platform in about July of this year.
There's going to be quite a bit of exciting news in between because we've established some really unique components of the experience, and both the experience and the partnerships are aligned with BitCar.
There's a long term value proposition because we're very excited about getting into things like autonomous driving vehicles and the future of the automotive industry. BitCar wants to align itself as a premier access point for the automotive sector.
What's your road map?
The roadmap now gets into, you know... We're highly concerned right now with being good at what we're doing. And I think that's the best track to follow given my experience. Be really great at the one thing you do well and then expand on that. So getting to July will be the major piece and then really honing in on the adoptive quality standards for those broker agents who represent the buyer class.
So you almost want to look at it as a sort of e-trade. We're really just facilitating a buyer and a vehicle, and allowing them to trade those assets.
By the way, I didn't mention that those utility tokens will be liquid, so they can be traded peer-to-peer or on the exchanges. They don't have to wait five years to trade their tokens, they can do that at their own pleasure.