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AirTM - Equity Offer on BnktotheFuture - Mutual Spring
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AirTM – Equity Offer on BnktotheFuture

Afternoon, this is an outline of the investment opportunity;  AirTM, which is currently offering equity on BnktotheFuture. As always, this is not investment advice, but merely critical reflection that may allow you to make you own informed investment decision.


So AirTM, what is it? So we have had our eye on it ever since it made the cryptonews circuits back in late 2015 (see; Cointelegraph, theMerkle). Its basic aim is to bring financial services to the developing world, with particular focus on those with volatile domestic currency regimes; see short video here. There are no end of examples of countries suffering from these kinds of issues; just think Venezuela in recent months where their currency has reported inflation rates of 1000%+. Therefore they are attempting to meet two broad market needs; creating an infrastructure for financial services and providing a store of wealth outside of the local currency.


Firstly, an infrastructure for financial services. AirTM provides a platform for people to convert their local currency into digital US Dollars, or “Cloud Money” as they describe it. This is done via linking individuals up with local vendors who accept the local currency, who then debit the customer’s AirTM account with the digital dollars. This is like the LocalBitcoins service, and the company states that often it’s vendors also offer Bitcoin in this way. AirTM is currently operating on the Uphold network, which is global platform that enables the instant transfer of assets between its members. Currently every one of these cloud dollars are backed by “real world” assets on this Uphold network. AirTM states it it moving away from dependence on the Uphold system by September, will have its own AirUSD asset on its own blockchain. The AirUSD asset will act similar to the USD Tether asset, discussed in a previous blog here. It will be pegged to the dollar to reduce the volatility of the asset. It will be backed through a decentralised network of trusted partners holding a reserve fund.

Why this kind of project is interesting is because if the Cloud Money is indeed trusted, its potential to expand financial services is endless. Once individuals convert their local currencies in these digital USD, they will be able to eventually access a range of third party financial applications; likely insurance, loans, savings management, etc. AirUSD will also be interoperable with the Ethereum network and therefore its wide range of services and applications (‘dapps’ too…another story). There is no overstating the need for proper access to financial services for the developing world. If farmers could get access to insurance or derivatives, it would enable them to hedge risks such as flooding or famine. Individuals can also make payments globally, without any local restrictions, as their money is in the “cloud”. This means that same farmer could have access to more lucrative markets for their products, instead of going through local middlemen. More broadly, this is the direction of travel within the financial industry. These networks are safer, cheaper and quicker than traditional banking networks. As their assets are predominantly digital, they allow much smaller micro transactions than banks, which are much more applicable within the developing world. AirTM are also later conducting an Initial Coin Offering (ICO), which means they will issue their own cryptocurrency giving it further interoperability.

Secondly, a store of value. The currencies of countries like Venezuela become volatile because people lose faith in the political or economic systems. This has happened many times before, and will happen many times again. If an individual has their entire life’s savings in that currency, they could be reduced to poverty. Having easy access to USD-pegged currency will enable some of that person’s savings to be stored more securely. This is not just a process that takes place in the developing world, a percentage of my assets are currently in USD to hedge the demise of the GBP after Brexit. However, you should never be complacent, the US economy have serious political and economic flaws that may lead to the devaluation of the USD. But again, this is the beauty of a network like AirTM. If an individual loses faith in the USD, they can quickly convert their funds into other assets; Chinese Yuan, Euros, gold or Bitcoin. AirTM also stresses that withdrawing from this network is as easy as clicking a button. However, I do think a issue that is worth noting for wealth storage is that AirTM doesn’t seem to state the level of its reserve fund. Its held by its decentralised network of partners and merely states it will meet liquidity needs. I also noticed that that the company stated that USD Tether could also form part of its reserve fund, which as discussed before, is in fact based on a fractional reserve. In theory as long as real dollars are available when individuals want to withdraw their Cloud Money, everything should tick over ok. But in theory the housing market was risk free and would increase in value forever, or at least we thought until 2008.


AirTM is demonstrating that its model is actually valuable to its customers. As of writing there has been nearly 50,000 customers making 200,000 transactions across 94 countries, as displayed on its website. This definitely sets it apart from the recent rounds of ICOs that have been nothing more than a proposal and flashy website. These ICOs have attracted millions of dollars of investments and to be frank, millions of dollars will be lost. There are a couple of companies aiming to do similar things to AirTM (Abra, Everex) which I am perceiving a positive reflection on this sector. As the world becomes increasingly connected, financial services like AirTM will be the lubricants of those connections. The financial industry is moving so quickly that the banking system looks like a hangover from the 19th century and even Paypal looks like bumbling giant, ready to be disrupted. Although no one can predict who the future giants will be, diversified investments on companies like AirTM will provide some exposure to the rate of change. It is also prudent to consider investments that are targeted towards the billions of individuals without access to proper financial services. As described by AirTM, they offer a “first mile, last mile” connection between individuals and the wider financial system. That is definitely a space that will need filling and AirTM may be the one to do so.


Thanks for reading.

Stuart Bowles

Join the discussion 3 Comments

  • Avatar Matt says:

    Why are they moving away from the uphold platform?

    • Stuart Bowles Stuart Bowles says:

      I think there was a worry about being over reliant on an external platform, which kind of defies the point of cryptocurrency-based payment systems. There was also some worry from potential investors about AirTM’s Unique Selling Point (USP). How different is it if me and you could set up a similar network using open source code and base in on the Uphold platform?

  • Stuart Bowles Stuart Bowles says:

    I mentioned in the blog above that I was unsure about the reserve holdings of AirTM. Tim Parsa the Executive Chairman of AirTM has now confirmed to me that AirTM will hold 100% USD as a reserve for the AirUSD in to circulation.

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