XYO looks to Singapore to expand its ecosystem’s capabilities
02:36, 17 February 2022
The Monetary Authority of Singapore may have recently issued a warning against local retail investors from investing in cryptocurrencies but the Southeast Asian city state remains a focal point for the global blockchain sector.
US-based geospatial blockchain XYO is one such firm. Last week it inked a $20m deal with Singapore-based crypto investor Outliers Fund, a venture capital fund with roots in Harvard and MIT.
The tie-up with Outliers Fund comes just a month after the XYO token was listed on Huobi, one of several Asia focussed exchanges the digital assets can be traded on, as well as Coinbase in the US.
Pivot to Asia
Singapore is set to be the centre of XYO’s Asian operation Markus Levin, the co-founder of XYO told Capital.com over a video call from his San Diego base.
Levin says that the tie-up with Outliers Fund will result in a series of projects which add additional functionality to the blockchain’s ecosystem and also apply its technology to the metaverse.
“We have already made our first investment with this structure, and that’s a super exciting thing for us.”
Levin says that his firm’s pivot to Asia is a natural function of crypto’s greater appeal in the region compared to the advanced economies of Europe and North America.
“In some of the less economically developed areas in Asia, crypto has such a more profound impact than in a place like America. If a user in, say the Philippines, earns some XYO’s, by providing technical data, for example, and that token goes up in price, it has a greater impact on their personal finances.”
XYO’s “amazing run”
Levin points to the success of the play-to-earn blockchain (P2E) phenomenon in Southeast Asia as an example of this.
“P2E was huge in places like the Philippines and Indonesia. But it’s not that big in the US or Europe yet.”
Levin says the XYO token went on an “amazing run” in 2021, going from a low to high that saw it increase in value 560 times. According to data from CoinMarketCap.com on 11 November last year the crypto’s total market capitalisation was close to $1bn though this figure has dropped back since and it is now hovering around $280m.
“XYO had insane momentum. And now since November, this has cooled down a bit but everything came together, our network is growing, the token is growing. Our company is profitable and growing both in terms of the numbers of customers and clients. And Huobi is a big piece of that.”
What is an oracle?
The XYO blockchain is geospatial oracle network, which means in simple terms it uses the power of Web 3.0 to provide location and other forms of data, such as temperature, that can be used for mundane tasks such as tracking parcel delivery but also in life saving contexts like locating lost hikers in the middle of a rainstorm.
Oracles first appeared in the crypto world in 2018 and essentially they are an API which connects blockchains to the physical world and crucially bring trust to the transaction process.
“So if you order some wine from France, XYO can tell which route it took on which ship and that it has arrived at its destination, while never going above 15°C. And XYO can provide the customer certainty, at which point they can then provide, say half an ETH to the seller.”
The XYO network also acts as an interface to the metaverse, providing ownership proof of objects such as a pair of Nike sneakers which are being retailed in the digital world.
Numerous use cases
Levin says in addition to the metaverse there are numerous use cases for this combination of location and temperature data, particularly the ability to provide information at a granular level.
As global warming speeds up and there are increasing numbers of extreme weather events an industry has emerged that provides insurance against this, using products such as weather derivatives.
Despite the name, weather derivatives are typically insurance contracts which pay out not on a specific loss but instead after a pre-set period of specific weather conditions have occurred.
For example, a farmer may want insurance against rain being above a certain level during the harvesting season and Levin says that XYO’s technology is able to provide definitive, and trustworthy, data on whether these events have happened.
Levin says that insurers themselves are still hesitant over using blockchain technology but that his firm is in conversations with a number of firms which are intermediaries in this sector.
“Say, your neighbours, and other people have devices you trust, they will go and verify that your field has been flooded, for example. And that means the insurance can be paid out. And then in that case, both the insurance company and the farmer have an interest, to determine whether the field has really been flooded, and XYO’s technology can help with this.”
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