“Nothing makes money like money.” It’s a mantra from the world of finance. In today’s frenzied fintech sector, we might soon say that nothing makes money like companies that move value, in any form it takes.
Funders poured nearly $5 billion into American fintech companies in the first quarter of 2016. It’s why VC funding for bitcoin and blockchain (the technology that bitcoin and other cryptocurrencies are based around) companies topped $474 million in 2015. Companies in this sector are fired up to put out the payment solutions that can be the currencies of the future.
You might think humans already solved the problem of how to pay for stuff. But cash gets stolen. Credit card fees are punitive. Fraud associated with the plastic in your wallet costs American merchants alone $35 billion a year. The currency exchange fee at the airport and with credit cards will put you off travel for good.
That’s why fintech upstarts are getting so much attention. Enter BitRush Corp. (CSE:BRH), with its patent pending blockchain-based universal payment system ANOON (www.anoon.co). It integrates cryptocurrency systems and fiat currency money systems into an easy to use digital means of payment. The company aims to help everyone tap into a mobile peer-to-peer economy that solves some of our biggest pain points around payment.
Launching in 2014, the Toronto-based company invested in a portfolio of promising cryptographic solutions from North America and Europe.
The platform relaunched in June, incorporating features requested by customers. BitRush partnered with Wave Crest, another payments solution company, in the first half of 2016, which gave them access to the Visa and MasterCard networks.
A zero-balance ANOON Visa debit card usable anywhere Visa is accepted from point of sale to ATMs worldwide came out this summer as well.
The company keeps adding new functionality, such as its recent integration with PayPal. The debit cards are directly connected with the user’s ANOON wallets and don’t need to be preloaded. As long as the user has funds in his wallets (in whatever currency) he can spend them using his debit card.
As ANOON is a multi-currency system users can hold funds in many currencies at the same time and easily transfer funds between different currency wallets. The currency conversion is done in real time deploying a smart conversion algorithm and bitcoin as a clearing currency. Users can fund their wallets using bitcoins (and other cryptocurrencies in the near future), PayPal, credit cards and bank accounts.
When BitRush’s founders started out, they asked one key question: where could blockchain have an advantage over the legacy payment systems in place today?
“We designed ANOON to match, or in some cases, go beyond the core capabilities of the biggest payment systems out there, combined,” says BitRush President Karsten Arend.
The platform offers instant and secure transactions, ease of access to funds, intuitive controls and privacy. Arend says that as far as they know, BitRush is further along with their offering than any of their competitors, including some who have raised tens of millions and in a few cases, more than $100 million.
“The system has been running just fine,” Arend says. “It’s robust. It’s tested. We’ve created a system that people can use how they want to use it. They never have to deal with cryptocurrencies if they don’t want to. They can just use fiat currencies. It’s universal.”
How does he know the system is so robust? BitRush is already processing up to 50 million micro and nano transactions per month. The company tested their proposition the hard way, by reaching out to their target markets at the same time that they built ecosystems in which ANOON could flourish.
Those transactions add up to a highly scalable business with attractive margins. Using its private blockchain, payment transactions between ANOON wallets can be cleared on a real-time basis with nearly zero costs.
ANOON has implemented free basic wallets as well as premium wallets available for a fixed monthly fee. Recurring revenues from the fixed fees constitute a main source of revenue.
They also created viable businesses that have a competitive advantage by using ANOON, just to show other companies what they could do with it.
BitRush runs the AdBit advertising network (www.adbit.co), a platform with more than 10 million unique visitors and 1.8 billion delivered ad impressions per month. It lets website publishers auction ad space to advertisers via a smart-bid system. AdBit is deploying BitRush’s ANOON to process payment transactions.
The hyper-efficient ad broker uses bitcoins as a clearing currency that pays website owners in real time. That means no more waiting weeks or up to a month for cheques from Google or other ad networks. The system also provides more useful data for advertisers and publishers, letting them target ads better.
Meanwhile, BitRush also owns Start-It, a publisher of cryptographic games, along with a Player vs Player gaming portal, WaggaWagga. Start-It’s cryptocurrency-based gaming sites already have 7 million unique users per month from more than 180 countries.
The need for some kind of cryptographic payments solution in gaming is intuitive: people often don’t feel comfortable giving their private information or depositing funds with a gambling site. That leads to a huge drop-off in potential users and a commensurate reduction in potential revenue.
From the gambling site operator’s perspective, trust is also a problem: it’s not uncommon for online gamblers who lose to claim their information was stolen and then demand a refund. That’s just not good for business.
By simply integrating ANOON with the gaming site, a player will be able to start gambling instantly, without giving away private information to a stranger or depositing funds on a site they just discovered a few minutes before.
AdBit and gaming are essentially proofs of concept, since BitRush’s business model, at the core, isn’t about dominating advertising or gaming.
“We only built those businesses to show other companies that they would have a competitive advantage by using our ANOON payment system,” Arend says. “Instead of telling them how they might use it, we show them the advantages it has with our functional growing businesses.” Gaming companies and website publishers aren’t BitRush’s competition: they’re the customers.
For a company that’s developed a universal payment platform, it seems to fit that BitRush has a very international profile. BitRush is listed on the CSE as well as the Frankfurt Stock Exchange.
They also have stakeholders and executive board members who hail from eight cities on three continents, including Toronto, London, Vienna, Hong Kong, Singapore and other centers of commerce and innovation. “We’re Canadian, but we’re also global,” Arend says.
The success they’ve had so far has come from listening to their customers. “I know that’s nothing new, but we started out by speaking with our customers about what they didn’t like and built a solution to solve for that.”
“When we showed it to them, they started jumping up and down,” he adds. “It was a good thing. Sometimes you can solve the problem with greater ease than expected.”
Founders in any sector also need to follow success, Arend says. “What I mean by that is if you design your business to do one thing and find you’re getting great traction in a slightly different direction, find out why that’s happening. That might be the direction you need to go in. Don’t ignore it.”
Learn more about BitRush Corp. at http://bitrush.co/ and on the CSE website at http://thecse.com/en/listings/technology/bitrush-corp. Watch Karsten Arend’s presentation from the recent CSE Day in Toronto below: