Prime Shipping Foundation Wants Its Own Crypto
Prime Shipping Foundation, which has the distinction of being the first shipping company to invoice freight in cryptocurrency, has decided to develop its own cryptocurrency. In order to fund its crypto-project, the commodities shipper wants to raise $150 million through an ICO. Notably, the shipping agency was formed through a partnership between Quorum Capital Ltd. and Russian ship broker Interchart LLC.
According to Prime Shipping Foundation, the conversion process between different fiat currencies would be simplified by using its own digital currency. Ivan Vikulov, the company’s CEO, also thinks that using cryptos can expedite settlement times. Mr. Vikulov’s shipping agency already has hands-on experience when it comes to handling large crypto-related transactions. In fact, his company shipped 3,000 metric tons of wheat from Rostov-on-Don, a port city in southern Russia, to Samsun, a city located on the north coast of Turkey. The financial transaction for the shipment was done using Bitcoin.
Bitcoin’s Lack Of Liquidity
Although the freight charges were invoiced in Bitcoins, actually using cryptocurrencies to pay for the goods was not easy, according to Mr. Vikulov. The Prime Shipping Foundation CEO stated that processing the digital transaction was challenging because of their lack of liquidity (fiat conversions) when it comes to handling higher amounts. He went on to explain that, “The conversion in and out of Bitcoin can sometimes take one or two days, and that’s not fast enough”. However, he pointed out that by using his company’s cryptocurrency, once its launched, will reduce processing times to “a few seconds”.
To develop such a “fast crypto”, Prime Shipping Foundation believes that they need around $75 million. The firm also plans to process all shipping orders through its own Prime Crypto Bank, which is currently in the pipeline. Per the company, conversions to fiat currencies from its proprietary crypto will happen instantly.
Plans For The ICO
In order to properly conduct its ICO, Prime Shipping Foundation has hired experienced auditing firms. Additionally, the company is working on acquiring a banking license in Gibraltar, where its partner Quorum Capital Ltd. is based. This seems to be a wise move since Gibraltar is known for having crypto-friendly laws.
The shipping agency appears to be well equipped to handle this project. That’s because it is already trying to handle cryptocurrency transactions for bulk commodities through its blockchain-based payment platform. Distributed ledger technology has caught the attention of many other organizations as well. In fact, commodities dealer Louis Dreyfus executed what appears to be the very first farm commodity deal using blockchain tech. The transaction involved selling American soybeans to Shandong Bohi Industry Co, Ltd,, a leading provider of agricultural products in China.
Clearly, cryptocurrencies and their underlying blockchain technology have numerous use cases. If Prime Shipping Foundation can successfully raise funds for its ICO and deliver on its promises, then it could help pave the “crypto path” for other shipping agencies.