OmiseGo is one of the more interesting cryptocurrency projects that is trying to become a decentralized bank, exchange, and asset-backed blockchain gateway.
Developed on the Ethereum network, OmiseGo has stated that their goal is to become the “preeminent high-value exchange and settlement platform”. Through this, they hope to give people in Asia a quick and easy way to make international payments in a decentralized way.
These are no doubt ambitious plans but does the project have a realistic chance of meeting these goals of “unbanking the banked”?
In this OmiseGO review, we will take an in depth look at the project including the technology, team backing, unique selling point and OMG token prospects. Let’s jump in.
Omise & OmiseGO
We can’t talk about OmiseGO without talking also about Omise, which is the parent company that created OmiseGO. Omise was created in 2013 as an online payment gateway similar to Paypal or Stripe. It is based in Thailand and was founded by Jun Hasegawa anf Donnie Harinsut, who remain the CEO and COO of Omise and OmiseGO.
Omise Company Overview. Source: Omise Website
Because Omise already had a large existing online payments product, the release of OmiseGO came with a lot of media attention and high profile partnerships. Two of the projects advisors are the co-founders of Ethereum, Vitalik Buterin and Gavin Wood. If that’s not enough, OmiseGO has also been endorsed by the Bank of Thailand and the Thai Ministry of Finance.
Omise has already begun using OmiseGO to supplement the existing payment network. Companies like McDonald’s and Alipay use Omise and will also be accepting OmiseGO.
Omise disrupted the financial sector when it was introduced to Asia and the company plans to do the same with OmiseGO. One way they’ve enabled disruption is by making their wallet SDK white label, enabling third-parties to develop and deploy payment solutions. OmiseGO has promised to lower transaction costs for financial transactions; including the exchange of fiat and crypto currencies, making payments, sending money and much more.
Because of its connection to Omise, OmiseGO is closer to mainstream acceptance and usage by merchants and retailers, and if successful it will be the Paypal of cryptocurrencies.
The OMG Token
As of early September 2018 there’s a total supply and a circulating supply of 140,245,398 OMG. And that’s all there will ever be since OMG is not minable, the supply is capped and there are no plans to create any more in the future. The price is at $4.89 and the market cap is just over $686 million, making it ranked #21 in market cap among all cryptocurrencies.
The OmiseGO blockchain is Proof-of-Stake and the OMG token is an ERC-20 token.
OMG Token. Source: Fotolia
During the ICO, which raised $25 million, 65% of the supply of OMG tokens were distributed. 20% was retained by Omise for operational expenses, while 10% was given to the developers, and 5% was put aside for an airdrop to ETH holders.
That airdrop occurred in September 2017 for holders of a minimum of 0.1 ETH at block height 3988888, and was the only one. Any others claiming airdrops of OMG were scams.
One criticism of OMG is that it remains quite centralized. The top 100 accounts own roughly 65% of all the OMG tokens. If you take the OmiseGO ownership out of the equation, and tokens held by exchanges, there still remains 25% of the total supply held by a small minority of users.
Major OMG partners include SBI Investment, SMDV, SMBC, Golden Gate Ventures, Ascend Capital, East Ventures, Krungsri Finnovate, and Global Brain.
OMG Plasma Network
OMG has been one of the first tokens to begin development on the Plasma Network, which is a smart contract network that will run on top of the Ethereum network. Plasma is a development of Vitalik Buterin that can run as a child chain of Ethereum.
Plasma was designed to handle enterprise level scalability and can theoretically handle up to 1 million transactions per second. That makes it faster than even the Visa network, which process a maximum of 50,000 transactions per second.
OMG Plasma Network
OMG is scheduled to release the Plasma network by the end of 2018, and if it is successful it could be just what cryptocurrencies need to catapult OMG into mainstream usage.
I want to emphasize here again that Omise and OmiseGO are two different companies offering two different products. This gets confused sometimes since OmiseGO is supported by Omise and there are many intersections between the two. Because of this the history will contain information about both.
Omise was created as an online payments solution similar to Paypal and Stripe, but focused on markets in Southeast Asia and Japan. It was designed to be able to legally process credit cards as it is fully PCI compliant. Online it can be integrated with all the major ecommerce platforms such as OpenCart, Magento and WooCommerce.
It was also designed to support the SWIFT banking system, which will go a long way in keeping any cyptocurrency transactions in-line with financial regulations. In fact, OmiseGO has stated its intention to eventually replace the SWIFT system to enable currency exchanges between all platforms.
Omise is right on the cutting edge of mobile payments and has its own mobile wallet which is similar to Apple Pay. It has also created a Facebook chatbot that enables payments through Facebook Messenger.
Omise is already accepted by more than 10,000 merchants across the Asian region, with the largest being McDonalds Thailand and Alipay. It is also accepted by Bose, Allianz, Burger King and many, many more.
Some of Omise’s Partners
It’s crucial to distinguish between Omise and OmiseGO here. Just because these merchants accept Omise payments does not mean they accept OMG payments.
OmiseGO is legally a subsidiary of Omise. If you are invested in OMG tokens it does not mean you’re also investing in Omise as a company. But Omise is tied into OmiseGO because it will be using the OmiseGO blockchain and will be supporting the OMG token.
Because OMG has been integrated with the existing and successful Omise platform it has received a lot of media attention and praise. It also doesn’t hurt that OMG has been embraced by Thailand’s government and banking industry.
Overall, the growth of OMG was heavily bootstrapped by its connections to Omise, and this could be one key to OMG becoming the mainstream payments cryptocurrency.
One of the stated goals of most cryptocurrency projects is the disruption of global banking and traditional financial systems, but OmiseGO is actually aligning itself pretty closely with current banking trends. This is similar to what the established online payment providers are doing with fiat currency. OmiseGO wants to provide that service with cryptocurrency.
OmiseGO promises to make commerce cheaper for everyone.
OMG Token use case overview
Consider how complicated it is currently to process a credit card transaction. While you don’t see it as a consumer, the infrastructure that supports credit card transactions is massive, consisting not only of the merchant and card issuer, but also the card network and the acquirer. Needless to say all these levels make processing credit card transactions far more expensive than they need to be.
Ecommerce is growing, but is still less than 15% of all retail sales. Mobile payment options are also growing, with roughly 40% of retailers accepting some form of mobile payments. However, only 3% of retailers accept cryptocurrency, and Bitcoin is by far the most commonly accepted.
The World Bank’s data shows some 2 billion people around the world currently unbanked. In the U.S. alone there are 9 million unbanked and 24.5 million underbanked, according to data from the FDIC.
The U.S. economy is certainly much larger than that of Thailand, but Omise and OmiseGO are working to reach all of Southeast Asia, and Japan and China. This is a huge potential market, especially China, where mobile payments are growing much faster than in other developed countries. OmiseGO might be relatively unknown in the West, but it is planning on becoming a household name in Asia.
The real competition though comes from the online payment platforms. This includes Paypal, Stripe, Apple Pay, Samsung Pay and others, as well as credit card issuers such as Visa, Mastercard and American Express, and even the banks themselves, since they back the credit cards. The competition also includes the hundreds of payment processors currently in existence.
Any of these could partner with OmiseGO and use their technology to move into the future, but they could also try to implement their own solutions. Paypal has already filed a blockchain patent, as did Mastercard.
Additionally, Apple, Samsung, American Express and Visa all have in-house blockchain development ongoing. It could be a long road and a hard fought battle for OmiseGO to win as the top crypto payment processor, but they are well positioned for the battle.
OmiseGO Team Members
Something that is indeed quite impressive about OmiseGO is the breadth of experience across the team members. Not only do you have the original Omise team that built the payment’s startup, but you also have some really big cryptocurrency figures as advisors.
OmiseGO was founded by Jun Hasegawa and Donnie Harinsut (co-founders of Omise the company). Jun has over 16 years of experience in web & product design and has founded a number of other entrepreneurial ventures in Thailand. Donnie is the COO and also has extensive experience in Asia having worked for Alpha-do Inc in Japan for over 13 years.
OmiseGo Team Members
On the advisor side, OmiseGO can tap the brains of numerous developers and founders from the Ethereum project. Apart from Vitalik Buterin and Gavin Wood, they also have the co-author of the plasma network as well as the research lead of Ethereum’s Casper PoS protocol in their advisor pool.
OMG Token Performance
The price of OMG has declined throughout 2018 along with the broader cryptocurrency market. It’s price peaked on January 7, 2018 at $26.14 and has been heading steadily lower since. There was a small rebound in April, but with the steady downtrend it has dropped all the way to $4.80 as of early September 2018. Of course this is quite a gain from the $1.00 ICO price in June 2017. Overall it’s been a very good 15 months since the ICO for investors.
If you want to buy OMG you need to do so with either BTC, ETH or USDT. It isn’t available for fiat purchases, except for Korean Won or Thai Baht purchases from exchanges in those respective countries. Currently the largest exchange volume for OMG is at Huobi, followed by Binance, Ethfinex and Bithumb.
Asian users will have a far easier time obtaining and using OMG as it isn’t very widely available or accepted in Europe and North America.
OmiseGO saw very strong attention during its ICO and shortly after, and while the buzz has died down it remains a very strong coin. It has several benefits that could take it to new heights as it becomes more developed and enters mainstream usage. One of those is its goal of providing banking to the unbanked in Southeast Asia. Another is its aim of entering mobile banking in China. Both could create widespread adoption of OMG.
Let’s not forget that the OmiseGO blockchain supports the already successful Omise digital payment gateway. That alone gives OmiseGO a huge advantage.
If OmiseGO gets the Plasma Network working properly by the end of 2018 it will have arguably the fastest blockchain network on the planet. Finally transaction throughput will be large and fast enough for everyday usage.
And finally the backing for OmiseGO is substantially, with the co-founders of Ethereum acting as advisors, several prominent Asian VC firms providing backing, and OmiseGO has the backing of the Thai central bank and Ministry of Finance.
OmiseGO has many of the pieces in place that would be needed for it to become the everyday digital payment for much of Asia, and from there potentially the world. It’s definitely a project to keep an eye on in the coming months and years.
Featured Image via OmiseGO