Farad, a Malaysian company, has launched Farad cryptoken (FRD)—which is claimed to be the first cryptocurrency backed by real economic activity—in Dubai this week.
A cryptocurrency, or token, is a digital currency in which encryption techniques are used to regulate the generation of units of currency and verify the transfer of funds, operating independently of a central bank. Bitcoin is the most famous example of a cryptocurrency.
Farad is the first cryptocurrency backed by real-economy activity, Wan Hasni, CEO at Farad Program said.
Simply put, an investor can purchase Farad cryptokens, which will be backed by the manufacturing of ultra-capacitors—that are seen as the future of energy storage.
These tokens are unique in that they are generated in line with the production of Farad’s capacitors. Its initial coin offering (ICO), the latest in a long line, follows the spikes in the value of Bitcoin.
According to a statement, each Farad cryptoken is representing the rights to the forward purchase contract of 80,000,000 ultra-capacitor cells produced by a Chinese company over a period of 36 months.
According to the company, at the time of ICO, 1 FRD will be equivalent to $12.50. The pre-sale ICO will happen on August 25, and then on September 15, the sale will begin in earnest.
Around 1.2 billion FRD will be issued in the ICO, half during the pre-sale and half at the full sale, for a 10% premium. The ICO will be followed by roadshows in Asia and Europe to promote the business.
Each capacitor production is recorded on the Blockchain, giving transparency as to what is happening in the factory said Andreas Kristof, chief technology supervisor, Farad Program.
This is unlike other cryptocurrencies, such as Bitcoin, which are produced by mining, a process in which real people use computing power to solve complex mathematical equations that authorize and authenticate transactions, receiving coins in return.
Underpinning such crypto currencies is Blockchain, the technology that records and tracks digital currency transactions.
First conceived as a way to create, trade and track cryptocurrency Bitcoin, Blockchain has grown in prominence because it does not allow transaction records to be altered.
The term ‘blockchain’ refers to the series of linked transactions, which become a block and form a chain.
Recently, Omar Kassim, the Dubai-based founder of online marketplace JadoPado, launched another startup, one that aims to facilitate real estate transactions using blockchain technology.
Esanjo is a real estate asset management business on Ethereum, which is an open-source platform that makes it possible to build and use applications that run on the blockchain.
Ethereum lets developers design and issue their own ‘cryptocurrency’—which means they create a ‘tradeable digital token’, which is similar to a virtual share.