LEOCoin: After bitcoin crash, a new virtual currency emerges

April 02, 2015 18:36
Dan Andersson (right) and Atif Kamran, co-founders of LEOCoin, believe the virtual currency will be more popular than bitcoin as it caters to users in the mass market. Photo: EJ Insight

These days, when we talk about bitcoin, the virtual currency is often associated with investment scams, criminal activities, highly speculative and volatile trading, and efforts by authorities to curb its use and trade. 

The digital currency was priced at 7,005 yuan per unit at its peak in December 2013, but the price crashed by nearly 80 percent to 1,524 yuan as of today.

But that hasn't stopped the emergence of a new digital currency – the LEOCoin, which claims to be the world's second largest virtual currency after bitcoin.

“A lot of that [volatility in bitcoin] was driven by an inexperienced, speculative market," said LEOCoin co-founder Dan Andersson. "Now today, there is much sophistication out there … so we put in measures in our exchange to stop the great volatility.

"Of course, people will always speculate ... but we are not here to drive speculative vehicles. We are here to drive a business that will transform the lives of small businesses," he said.

Andersson believes LEOCoin will be more popular than bitcoin as it caters to users in the mass market.

“Bitcoin has become an arms race of mining where big boys and big toys could play and the ordinary person cannot. So we chose algorithms and technologies that will support an adoption by ordinary people,” he said.

The digital currency was officially launched in London last week while its first online exchange, which is the platform for changing the virtual currency into real money, has been up and running in London since Thursday afternoon.

LEOCoin has committed to releasing a maximum of 28,800 units per day for a limited period of 99 years, totaling 1 billion LEOCoins. The value is expected to increase as the number of LEOCoins is finite.

Andersson said another LEOCoin exchange will be launched in Hong Kong in about six weeks after it gets approval from the Securities and Futures Commission. The exchange rate will be determined by demand and supply.

He refused to comment when asked if LEOCoins will later be traded in mainland China, only saying that the exchange will strive to comply with the rules set by Chinese regulators.

As of now, 31,000 merchants from across 41 countries have agreed to accept the virtual currency for payment. Most of them are small and medium-scale enterprises and over half of them are in the retail sector.

People can use LEOCoins in digital wallets installed in their mobile phones or personal computers to pay for transactions.

"We will charge a 1 percent LEOCoin fee for sellers in each transaction, whereas buyers do not have to pay any transaction fee," Andersson said.

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EJ Insight reporter