WASHINGTON, Dec. 11, 2017 /PRNewswire/ -- OilCoin, a project led by a team including Commissioner Bart Chilton of the U.S. Commodity Futures Trading Commission (2007-2014), is pleased to announce today the creation of the first legally-compliant digital currency based upon a physical asset. OilCoin will tokenize barrels of oil held in reserve with each token representing the value of one barrel. OilCoin's asset support will provide global users of digital currency with a meaningful safe haven from cryptocurrency volatility. OilCoin's public token sale (otherwise known as an ICO) is scheduled to begin in early 2018.
Commissioner Chilton has been instrumental in the development of OilCoin as a digital currency which will comply with U.S. laws and regulations and be suitable for global institutional and retail users. Commissioner Chilton has been an active voice within the cryptocurrency and blockchain community for many years and was the first U.S. government official to call for regulation of digital currencies.
In a recent keynote speech delivered during Hong Kong FinTech Week, Commissioner Chilton extended his years old message by encouraging digital currency enthusiasts to seek regulation and work with regulators (Speech available at https://www.bartchilton.com/). OilCoin represents the manifestation of Commissioner Chilton's desire to see the creation of a regulated digital currency based upon "something real that folks can touch and feel."
At US$1.7 trillion in annual transaction size, the global oil market is the single largest and most actively traded and liquid commodity market in the world and is larger than the annual GDP of all but 10 countries. It is 10 times the size of the traditionally accepted reserve gold market and is larger than all global raw metal markets combined thereby providing unique intrinsic support for the development of a globally accessible digital currency.
The OilCoin team is actively engaging with domestic and global regulatory authorities with the goal of making OilCoin the safest, most trusted and widely accepted digital currency in the world. Joseph Cisewski, former COO and Chief of Staff for the U.S. CFTC and Branch Chief Division of Trading and Markets for the U.S. Securities Exchange Commission, will be helping to lead OilCoin's push to become the first digital currency to be registered for resale with the SEC and to be subject to the periodic reporting requirements of the U.S. Securities Exchange Act.
Daniel Eisner, a member of the OilCoin leadership team and a corporate attorney and Senior Partner at the global law firm DLA Piper said, "The creation of an intrinsically valuable digital currency coupled with strict compliance with U.S. securities and commodities laws positions OilCoin to set a new standard for the structure, issuance, transparency and global use of peer-to-peer transferable tokenized value. OilCoin addresses the fundamental criticisms of cryptocurrencies by leading figures in finance, commerce and government regulation."
"We believe the OilCoin ICO represents a unique risk/return opportunity that should have great appeal to U.S. and global investors seeking a highly experienced management team, a clearly defined and executable strategy, and a 'picks and shovels' way to participate in the hyperbolic growth of cryptocurrencies and blockchain-enabled applications," said OilCoin co-founder Darius Brooks, formerly with TPG, a leading private equity firm.
As explained in the OilCoin White Paper (available at www.oilcoin.io) oil reserves will be sourced, held and managed by affiliate entities of the OilCoin Digital Reserve. "The price of an OilCoin token will approximate and move in tandem with the price of a single barrel of crude oil. As demand for OilCoin causes the price of a single OilCoin to rise above the price of a barrel of oil, additional OilCoin will be issued and the proceeds will be invested in additional oil reserves," said Brooks.
As transaction volume of OilCoin expands, holders will receive additional OilCoin as a share of transaction fees. Brooks explained, "As a commodity-backed digital currency, OilCoin will be a reliable store of value and medium of exchange. As an oil-denominated currency, it will also be free from the inflationary pressures and cross-currency volatility experienced by fiat currencies. Moreover, we believe the after-tax return profile for U.S. OilCoin holders will be superior to oil ETF's for sophisticated, commodity-focused investors." Brooks added, "Due to its relative price stability compared to other digital currencies, OilCoin is likely to be a favored digital currency to facilitate a wide range of global financial transactions."
Commissioner Chilton noted, "I think what you are seeing in OilCoin is a truly original and innovative endeavor focused on institutionalizing and professionalizing digital currency in a way that has never been done before. The OilCoin team is fully committed to setting and adhering to new standards for design and regulatory compliance of digital currencies. Once we get going, we envision holders of OilCoin will be able to participate in ordinary consumer transactions around the world. I've been saying for a long time that in order to gain greater acceptance in everyday commerce, something like what we plan for OilCoin is needed. Digital currencies will get there and OilCoin is well positioned to be the first."