On December 1st 2021, our community had a chance to welcome Mr. Arul Prakash, COO of Polytrade to join an AMA to deliver fruitful information about the key features and roadmap of the project.
This AMA was held by CryptoFamily Group – the top crypto community in Vietnam, where investors and traders can obtain the latest news and signals from bot/ admins, as well as discuss and share investment experiences in the crypto space.
🔎 Polytrade (https://polytrade.finance/) is a DeFi lending platform providing working capital to SMEs in the real-world using crypto liquidity.
At this AMA, Mr. Arul Prakash directly greeted the community and provided detailed information on the project as well as some exciting events that will be held in the near future.
Time: 20:00 PM (UTC+7) | Wednesday, 01-12-2021
Reward Pool: 200$ for members with the best questions.
Below are some main points of this AMA session:
PART I: INTRODUCTION OF POLYTRADE:
1. Firstly, please introduce about yourself and POLYTRADE.
Mr. Arul Prakash: In my official capacity, I am the COO of POlytrade Finance. I’ve been working with Fortune 10 companies in my recent past and heading product development & business transformation functions for many of my clients in US, UK, Singapore, Dubai and many more countries. Worked with companies like Walmart, CVS, Accenture and the TATA group extensively. Have been in the crypto space for the last 4 years and waiting for the opportunity to bring real world to Cryptosphere. MBA & engg by education.
We’re into the real-world invoice financing business since 2014 with 5000+ customers and US $500 mn+ worth of invoices financed. In our earlier venture Riqueza capital, we identified issues faced by SME suppliers like High rejection rates, high cost of funds, longer turn around time, large ticket size requirements. We realized Defi and Blockchain could help us address these problems. In a 7 trillion USD trade finance industry, the unmet demand in trade finance is to the tune of $1.6 trillion. Polytrade aims to address this huge gap by harnessing the massive liquidity of the crypto world targeted towards SMEs globally. We will seek funds from crypto native investors to use our platform to lend us stable coins. These stable coins are then converted to fiat or otherwise, and used to finance the SME suppliers from developing economies, who then become our borrowers.Polytrade is a crypto lending platform to meet the working capital needs of SMEs in developing economies. It connects borrowers, lenders and other stakeholders. In a simple example, a furniture manufacturer in Vietnam, might have a outstanding invoice against, IKEA retailer in USA. IKEA needs to pay money to the manufacturer in future after 45 days. Polytrade’s whole idea is to use liquidity from the crypto markets and fund these invoices. Which means instead of waiting for IKEA to pay after 30-45 days, now the manufacturer will request for money from Polytrade. Polytrade will collect that money from IKEA after 45 days. The discount or variance in these 2 amounts, is the margin that Polytrade will make.
In very simple words – We access liquidity from Crypto investors and loan it out to Small and Medium enterprises in the real world!
2. Next, can you share with us the vision and goals of POLYTRADE in late 2021 – 2022?
Mr. Arul Prakash: The month of oct saw MVP unveil at the World Blockchain Summit 2021 in Dubai on 13-14 October 2021. This Nov Polytrade got a host of other exchange listings, with MEXC, BITMART, PANCAKE SWAP, KUCOIN. For future, Polytrade META is in the progress for the Metaverse, we are setting up the lenders pool . Our mainnet launch date has been set for 10:10:10 hours UTC, 10th January next year and our team is working towards it. We will keep expanding our Partnerships network to tap into newer communities. We are working on more staking programs and also geography focussed exchange listings to penetrate and access newer markets. A huge number of events and competitions coming in terms of staking, trading competition, and amazing rewards for the competition as well. We are also looking at more exchange listing .. atleast 3 tier-1 as we speak.
Our newsletter: https://polytrade.finance/newsletter/oct21-vol-i.pdf
MVP demo: https://youtu.be/sW04yftWej4
The latest event we have that is coming up is the staking pools on Kucoin. https://twitter.com/Polytrade_fin/status/1465978174748041218?s=20
3. We read on a bloomberg article today that Polytrade is developing a new product for Metaverse. Please elaborate on that.
Mr. Arul Prakash: Polytrade is building a 100% on-chain trade financing and business finance solution specifically focused on the Metaverse.. As we progressed in developing the working capital solution for SMEs, there were 2 observations
1. The world of trade finance is not entirely ready for decentralization – it will take a lot of time for the full transition to happen
2. There are opportunities for similar products in the metaverse as well. With a 100% on chain solution.
So we are taking the approach of building for real world and for the crypto world simultaneaously.. This helps us achieve the decentralization goal of what is possible, while not losing out on the essential business that can come from metaverse and the crypto companies. The problem that we are trying to solve is the same in both.. the approach and target markets are different. Polygon(MATIC) has agreed to be our first customer to be part of this METAVERSE platform. Which means every invoice that POlygon is going to pay in future will go through this platform. So every service provider and vendor of Polygon has to use the Polytrade meta platform. This is a big game changer and needs extreme foresight and thought leadership to build this whole platform. Polygon’s trust on Polytrade to scale this application kicks it off really well and with time we need to see how we evolve and prove our leadership in this space.
Bloomberg article: https://www.bloomberg.com/press-releases/2021-11-30/with-defi-lending-protocol-set-for-january-launch-on-mainnet-polytrade-sets-sights-on-developing-product-for-metaverse
PART II: PRE-COLLECTED QUESTIONS FROM TWITTER
What #Polytrade revenue model? In which ways do you generate revenue/profit? So many projects just like to speak about the “long term vision and mission” but what are your short terms objectives? What are you focusing right now?
Mr. Arul Prakash: Polytrade is not a random idea which is being built as a fad by our team. We have been in the space of Trade finance for the last 7 years enabling $500 mn worth of invoice financing with over 5000+ customer base worldwide. WE are all people who come from some great institutes and professional background. We will use the liquidity of crypto lenders to finance invoices of the SMEs in the real world by charging a fee. We are expecting stable coin rates to be about 6-8 % for LPs. 8-12% as borrowing rate and the difference will be used for community, fees, insurance and other costs. Right now we are focussing on developing lending pools and development into Metaverse product line simultaneously. Our mainnet will be launched on 10 Jan 2022.
POLYTRADE builds a limitless financing infrastructure that extrapolates ownership of real world assets (“Receivables”) into digital tokens, exactly what happens next with these receivables? How does POLYTRADE translate this function into liquidity?
Mr. Arul Prakash: So basically, in our process invoices are the real world assets. When we fund against an invoice we typically take access and control this invoice, in a legal way. via agreeemnts. which basically makes us the owner of these invoices and any payments that we would receive against them.. On the date of repayment against these invoices, we will collect the funds from the BUYER and making it into liquid cash again. This cash.fiat/stablecoins are fed back into our liquidity pool. and funds with APY are returned back to our lenders.
3. From @Ashleyhanna33
I wonder if regular users will be able to use your loan facility or borrowing is only available to corporations, and they must qualify? In the PolyTrade system, how much can corporate entities borrow (maximum and minimum amount)?
Mr. Arul Prakash: Our ideal borrowers will be corporations i,e the manufacturers or suppliers in developing economies like vietnam who usually works on a credit payment basis with their customers and suffer a poor cash flow cycle in their business in absence of access to working capital. They can borrow anywhere between 5000 USD to 1 mn USD tokens. This is to encourage the small invoices of the small and mid sized corporations who are usually rejected by the banks and other financial institutuons
4. From @helianguyen389
Backers, investors, partners, and advisors are very important factors affecting the reputation and success of any project. Can you tell us who are the most influential partners on the project so far? What plans do you have to expand the partnership further?
Mr. Arul Prakash:
Backing by a pool of best investors and advisors in the industry like Polygon, Axia Ventures, AU21 cappital , Master ventures etc we have come so far with great success running a real business rather than just a mere branding. Polytrade’s alliance with Polygon under the guidance of Sandeep Nailwal will significantly help us scale our operations and visibility. As a leader in this space, we are certain that Polygon’s cooperation will take us in the right direction in terms of technology and help us achieve our vision with more impact.
Some other crucial partnerships have been forged with with Formation (a calibrated risk-return platform for lenders), Chainlink (the pricing oracle for real-time price feeds), Venly (for user wallets on our dapp), Unreal Finance and many more. Real-world strategic tie-ups with Global Trade Review for visibility in the Trade Finance world and MoU with Marco Finance, a company focused on SME lending in LATAM markets, for access to a new market have been secured, making Polytrade’s real-world intent a clear and present agenda. We will keep expanding our Partnerships network to tap into newer communities.
5. From @Kbriefy
Some of projects have excellent vision and mission but are not well-known and take a long time to be recognized in the crypto market. Please share with us what are your marketing strategies and how will you have a global expansion and adoption for your project?
Mr. Arul Prakash: We’ve multiple sources of growth. Most potent is our existing customer base of over 5000. We’ll be doing demos and fam sessions for our existing customers through one-on-one engagement and private events. We also have a database of about 20,000 prospects from South East Asia, Indian Subcontinent and Middle-East Asia who have enquired with us in the past.
Our BD team will be churning this pool to get some adoptions. Apart from these 2 sources, we’ll also be doing targeted lead gen campaigns using Google, Facebook, Social and e-Mail/ Database Marketing and other advertising media.
We’ve a strong business development and marketing machinery that is seasoned in B2B marketing and targeted selling.
we have some exciting new partnerships coming up, we are working on more staking programs and also geography focussed listings to penetrate and access newer markets.
PART III: BEST LIVE QUESTIONS IN POLYTRADE VIETNAM COMMUNITY
1.Quick question – For example, I’m the seller. I give my invoice to Polytrade. I’ll be getting my money from Polytrade while Polytrade gets my invoice. Now, Does will Polytrade collect the money from the guy that owes the money because of the invoice, right?
Mr. Arul Prakash: That is perfectly right… We take the responsibility of collecting the money from the company whose invoice it is. Precondition to our financing of course is that the invoices should be backed/backable by Credit insurance.
2. Is your financial feature (Receivable/Invoice) integrated with Unsecured Loans, if the borrower fails to pay, what is the compensation?
Mr. Arul Prakash: just answered in your earlier question…. all invoices have to be backed by credit insurance for us to fund.
3. What will be the conditions for businesses that want to benefit from invoice financing opportunities? Will you provide support to each company or should companies have a certain register?
Mr. Arul Prakash: the platform will be completely open. so anyone can participate.. but we will be performing the mandatory KYC and AML screening for all our platform users. This is to comply with law and ensure this is not used as a medium for transfering funds across teh globe
4. Smart contracts are susceptible to failure and many projects fall victim to this, costing users money and the project discrediting. How reliable and secure is your smart contract? Have you tested it through any of the parties?
Mr. Arul Prakash: There are 3 types of risks on our platform ..
Credit risk : What happens if a buyer doesn’t pay up or goes bankrup? – PolyTrade will cover this risk by taking credit insurance which covers for willful default and bankruptcies. This process has existed for a long time and is a critical part of traditional finance.
Smart contract risk: smart contracts will be protected by additional insurance taken from players like TIDAL insurance or Nexus mutual
Platform Risk: platform hacks or exploits that result in loss of value. Will be covered by the safety module that will be funded by TRADE stakers, in return for % of fees that the platform will earn – In a similar model as AAVE safety module. Think of this like insurance for the whole platform..
5. What is the main role of your token? What are its use and investment benefits?
Mr. Arul Prakash: you can check out our detailed video on the token utility which clearly explains all the benefits of the tRADE token.
CF: Thank you so much for taking your time to join our AMA today, as well as thanks our members for rasing hundreds of good questions for the project.
Seems like there’re many things to learn more, but I’m afraid the time is up now. For all of the questions that have not been answered yet, guys feel free to search for more information on the links provided below: