Hi everyone and welcome to the Jibrel
founder Q&A session. We’re here in the
New York City office and we have all
three founders present, on the left we
have Talal Tabbaa, the Chief Operating
Officer in the center we have Victor
Mezrin, the Chief Technology Officer
and on the right we have Yazan
Barghuthi the Chief Executive Officer they are
all going to be answering a list of
questions that have been most asked from
the community over the past few months
What is the state of Jibrel as a company
how have things changed for Jibrel over
the last two years since it was founded?
Well things change tremendously over the
last two years when we started we
were about eight developers and we had a
very short term focus so there was very
little Jibrel awareness outside the
crypto community especially amongst
institutions so the first few months of
the company were really focused on
trying to get our name out trying to
attract enterprises trying to
translate personal institutional
relationships into formal business ones
so it used to take us one to three
months to plan and then execute those
initiatives and as a result of that
success we’ve now engaged those
institutions so we had a chance to
settle the first Islamic bond on
Ethereum with Al Hilal bank and ADGM
but now as we move towards
implementations we have a much
longer timeline so what used to be one
two three months is now 12 to 18 months
and the biggest challenge there has been
managing expectations which tend to be
short term and managing implementations
which tend to be much longer term and I
think that’s been the biggest change the
shift in focus. The community has been
hearing about an upcoming product launch
of Jibrel.com. Could you walk us through
the significance of this?
Jibrel.com is extremely significant because it’s
the culmination of our learnings and
products over the past two years, so if
you go back to our white paper
which talks about placing financial
assets on Etheruem Jibrel.com does
just that starting with equities and
I’ll explain why in just a bit and so if
you think of Jibrel and the asset
tokenization thesis you have cash which
we created Jcash for and that’s the
tokenization of fiat currencies you then
have equities debt, commodities, real
estate the most important thing in asset
tokenization is to get a regulator or a
government entity to accept a token as
legal means of ownership and not just as
a proxy or as a derivative as actual
means of ownership so let’s say we
decided to tokenize this whole building
and we have an Etheruem based token that
represents this building but the real
owner goes to the Land Department and
sells it somewhere else
you’re essentially left with a useless
token that is not backed by an underlying
asset in our case what we’re doing with
with ADGM is we’ve successfully
convinced the regulator to accept tokens
issued by Jibrel as equity so that’s
your legal ownership rights we didn’t do
anything on the commodities side because
commodity markets are pretty mature and
they’re actually quite efficient on the
debt side under ADGM as well we did the
first susuk transaction with Al Hilal
Bank but as some of you know the debt
issuance process is a very
time-consuming process in the
traditional world it takes anywhere
between six to eighteen months to to
issue debt using traditional means so
you can only imagine how much more time
that would take when you involve banks
we’ve decided to launch Jibrel.com
out of ADGM which I think is the most
progressive regulator in the region they
have a crypto regulatory framework and
they have a private financing platform
framework those two together allow us to
launch Jibrel.com which is
essentially a platform that links
traditional financial assets with
digital investors,
the advantages of that are huge if you
want to look at the advantages let’s
look at the investor and the startup or
the SME, the SME can raise capital at
the fraction of the time and cost and
also access a much wider range or much
wider market of investors. From the
investment side you have as a solution
for information asymmetry we’re a
founder within form one angel investor
but not inform the other so you
eliminate that risk by by having it all
on one platform but more importantly
you’re able to invest in startups with
inclusive ticket sizes. In terms of our
launch we’re doing our first test and in
FinTech Abu Dhabi which is an October
21st and after that we’re launching our
private financing platform and then the
next phase is enabling secondary trading
and that’s where you really get more
interesting advantages such as shorter
lockup times and improved liquidity.
The illiquidity of startups is something
that’s prevalent across the
world so in terms of the launch of
Jibrel.com there’s one very important
prerequisite that we’re just finalizing
with ADGM or just finalized which is
basically having a token that represents
legal ownership rights legal ownership
and beneficial rights this is something
that has not happened anywhere in the world
there was one precedent for a company
called 2030 under the FCA sandbox in the
United Kingdom but the way that worked
is you have equity that is held by a
trust and a trust issues tokens, in our
case we’ve eliminated that trust and you
have equity tokens that are approved by
the regulator so that is that is the
first phase. The second phase is
basically the Jibrel.com platform that links
startups with investors so actually
conducting a couple of rounds on Jibrel.com
the third phase which is in my eyes
the most interesting phase is when you
enable secondary trading as part of that
if I asked you what’s the price of an
Apple stock today you could easily
figure that out and that’s because of it
being publicly listed but when it comes
to real estate and startups or illiquid
assets there is no price discovery it’s
it’s very difficult to find that and
that’s mainly because of how secondary
markets have been archaic for the for
the last 100 years I’d say so
this is unexplored territory and and
which is why I think it’s very
interesting. Some of the community feels
that Jibrel is behind schedule and that
product development of Jibrel is slow
for example there have been a couple of
iOS delays recently could you add some
context to these concerns? I would say
this a bigger question and I will start
from the first part is a strategy of the
product development. Two years ago when I
started to work on our product as it was
described in the white paper I started
to break the entire project into the
smaller parts and it was quite easy to
figure out that the part of the product
that connects to the blockchain somehow
we have to build from scratch
because there are almost no
technologists or tech components that
you can use on building your product and
the master idea was to develop the
components that we have to build in the
ways that we can deliver them to the
market as a separate products for example
when you develop Jibrel.com you need an app for
investors that they will use to manage
their digital on-chain assets equity,
bonds, some other assets and you come to the
ideas that you need for example Android
or iOS or web apps that allows you to do
that and there are no other particular
opportunities and to develop in-house
because you need many different features
so you have to incorporate them into the app, but
at that point you count those ideas that
probably it’s a good at it’s good to
deliver this app to existing market to
existing investors into the crypto digital assets and to allow
users to manage their on-chain assets
with our app. This is a good opportunity
for us to polish our technology to
figure out the limitations. Next when you
start to bring was a whole big idea of
Jibrel.com into the smaller parts
you figure out that you need a
connection to the blockchain and ability
to work with unchained data obviously
and you figure out the Ethereum node is
quite a slow app and you need you know a
kind of cache of the blockchain data
as its used to analytics as that he
who used to serve your users and so on
and we start to designs this back-end
app was a cache which is quite
sophisticated itself and you come to the
idea that basically you do the backend
app for a very good block explorer, this
is how idea of the block Explorer appeared.
We can come back to your original
question about
product development our main goal is
to deliver platform to tokenize and
manage digital assets on-chain and that
product that we have released so far a
kind of side activity for us which is
useful and from our eyes we did really
good progress in the last year because
we did that app you can use right
now also we did a lot of infrastructure
components that we already use and
beginning to use it in the future and from
that point of view mm-hmm actually we
very good pace. Sorry just to add to
Victor’s point when we did that data when
we did the Hilal banks Sukuk it would
have been virtually impossible to
convince the risk and compliance teams
to use something like MyEtherWallet
even though it’s a beautiful wallet very
well designed we don’t hold liability
for anything that goes wrong whereas
when we did when we use the Jwallet in
the Al hilal bank implementation it was
our own wallet we wrote the code from
scratch so we can guarantee that it’s
not buggy. Yeah and what is important we
can implement the features that we need
for particular project in this app it’s
virtually impossible if you use some
third-party apps. The same logic will
apply to any infrastructure piece that
we use so Jibrel.com is the main
platform but all of these different
products actually power what what we’re
trying to achieve with tokenization.
Community members have been expressing
some unhappiness with the lack of
connection between JNT and the new
and existing Jibrel products could you
offer us some insight into Jibrel’s
approach with JNT versus Jwallet
and Jibrel.com?
I think the most important thing to
remember here is all the incentives are
aligned we want we want functional
products with users and a vibrant token
and a vibrant community our first
experiment of the project was JNT
itself we built a regulated token that
can fully adhere to
real-world regulations including duty to
report, duty to freeze, and other KYC and
anti-money laundering regulation. The
second experiment was stable coins with
Jcash and we released a fully regulated
solution for stable coins and what we
didn’t really foresee there is we built
an enterprise-grade solution for
enterprise users and then we later found
out that enterprise users were forbidden
from using cryptocurrencies even stable
coins and on the other side users
who could access stable coins had much
easier solutions that didn’t require
them to jump through KYC loopholes so Jcash didn’t take as well as we had hope
but the lesson was clear and it was
learned that if you want to have a
successful community, a successful
network, in a successful token you need
to build products that users are going
to love and want to use and then you can
incentivize them to use the token I
think that’s the strategy will employ
going forward and I think it’s the
strategy that makes the most sense.
Some users and investors don’t feel that Jwallet is a sufficiently helpful move for
Jibrel could you talk about the purpose
of the Jwallet? Talking about Jwallet
we need to come back again to the
product management
for us for our products we need some
smooth and nice and easy to use
application for investors to manage
their on-chain funds, to get analytics
to get information, to do some actions
related for example into their equity assets
or bonds or something. Taking this
we should have an app that provides all
the ability to investors and as a side
activity we turned that wallet into the
Jibrel wallet and release it to the
market to help investors into the
regular cryptocurrencies manage their
assets it’s a quite good app for
investors it’s a good turn for us to
build the app and polish the tech.
It’s a win-win situation, if we talk
about the whole situation in general of
course Jwallet is very useful for us
and our token and the ecosystem in
general because this is a part of it. If you look at the Jwallet
at the moment some people would argue
that it’s it’s feature poor but that’s
because of our strategy of building the
base and then adding to that so
hopefully in the next iteration of the Jwallet even see additional
improvements and that will also
translate into features that allow us to
attract additional users but for me
I think it’s absolutely critical to have
our own wallet because it would be
impossible to convince a regulator, a
bank, etc to use a third party wanted
that we have no oversight or control on.
Could you tell us about what Jibrel is
doing with the Central Bank of Jordan?
Alright so actually my first internship
ever was with the Central Bank of Jordan
and I’ve been in touch with them ever
since. The Central Bank of Jordan
launched the regulatory FinTech sandbox
which is basically aimed at attracting
disruptive startups that want to change
the field of finance.
Jordan receives over four billion
dollars of remittances per year out of
that a lot of it comes from the Gulf so
Saudi Arabia and UAE being the most
highest traffic. Transaction fees on
sending money from UAE or Saudi back to
Jordan are insane whether that’s on the
actual transaction fee or the Forex
spread so how much they kill you on the
difference of the currency so what we’re
trying to do with with the Central Bank
of Jordan is to facilitate cross-border
remittances using Jcash that are
independent of Swift so in the Middle
East the correspondent banking system is
prevalent and for that reason
transactions aren’t very efficient, so
what we’re essentially doing with the
Central Bank of Jordan is testing out
transfer cross-border remittances using
Jcash that obviously takes a lot of
time for several reasons regulatory
because the central bank of Jordan
haven’t done something like this before
second of all because the banking
infrastructure in the Middle East leaves
a lot to be desired for example there’s
no outward facing API’s the core banking
systems aren’t as advanced so it’s an
interesting project but is challenging
to say the least. What are the
competitive advantages of Jibrel how
does it stand out from all the other
blockchain and crypto projects out there?
I think our competitive advantages are
clear and have been consistent
throughout and that’s we have very deep
relationships in the MENA region and we
have very deep institutional and
enterprise relationships and we’ve
leveraged both of those to our advantage
with regards to the first there are very
few other crypto projects in the MENA
region and and with regards to the
second the same can be said there are
very few crypto projects with enterprise
clients, I think those two advantages if
we keep capitalizing on will yield
results and I think there’s another one
to mention that we were talking about
earlier which is the multi product
approach.
Yeah you know I would add that our
multi-product approach is kind of
strange because we we are capitalizing
on this and will continue
to of course. Yeah that’s actually a very
good point because in an industry where
there are very little you use cases that
are proven you want to be as diverse as
possible just so that if something does
work out where something does explode
you’re there and you can capitalize on
it and I think that’ll be a huge
competitive advantage in the future.
Beyond the Central Bank of Jordan and
the UAE regulatory focus of Jibrel what
relationships does Jibrel have or wish
to have with other Middle Eastern
countries such as Bahrain, Saudi Arabia
and Egypt? So I think a big misconception
or a common misconception is that if
you’re regulated in the UAE you only
serve the UAE or if you’re regulated in
Jordan you only sort of serve the
Jordanian market. Jibrel AG is a licensed
financial intermediary in Switzerland,
we’re also part of the FinTech sandbox
in the Central Bank of Jordan, and the
reg tech lab in ADGM, and innovation
testing license cohort and DFSA, but
using those we can essentially target
the whole world not only the Middle East. Central Bank of Bahrain have been very
progressive in terms of their regulation
I’ve visited the Central Bank of Bahrain
a couple of times first time was
actually 2017 it doesn’t make sense to
be regulated there with our licenses in
the UAE, Jordan and Switzerland we can
pretty much serve any client anywhere
across the world. The nice thing about
ADGM as well is that they can onboard
American investors and American
companies so that’s also a huge target
addressable market that we will also be
targeting more aggressively. In terms of
Saudi Arabia, SAMA which is the financial
regulator there has also been
progressive they’re working on project
called Aber which is a crypto-fiat or a
stable coin that’s meant to help central
banks and banks reconcile within the UAE
and Saudi so I’d say our target is the
whole Middle Eastern region even though
our offices are in the UAE that doesn’t
mean we’re not focusing on other countries as well.
The most asked questions from
the community have been around tech and
product but they’ve also been around
marketing could you tell us a bit about
Jibrel’s marketing? Look I’m the first
person to say that marketing needs to
improve and I’m actively looking for
ways to improve it as is the wider team
it’s one of our biggest pain points that
being said as a result of the ICO craze
we ended up with an ecosystem that had
way inflated prices so for example to
list on a ICO listing website could cost you
upwards of $50,000 at some point, to list
on a leading exchange some people paid
up to six million dollars, we were quoted
four million dollars to add JNT
into a wallet and obviously these are
prices we were really unwilling to pay,
we it would have been a dead end for us.
So we’ve tried to come up with creative
and more efficient and conservative
approaches to marketing and these
marketing techniques tend to be much
more targeted and less in-your-face and
as a result it seems like we’re doing
less than we are we’re actually really
pushing strongly on user acquisition,
brand awareness, reputation management
and a wide range of marketing
initiatives. Just to add to Yazan’s
point Jibrel we see it more of a
marathon than a sprint Yazan
mentioned that we got quoted four
million dollars to list on a
wallet which doesn’t really add much
value but when we got opportunities for
example such as listing on Bittrex, Upbit
we’re not shy to follow those and
actually execute when it does make
sense we are happy to pay but due to the
ICO craze as Yazan mentioned a lot of
service providers were just
overcharging in a way that doesn’t make
any sense but if you look at our
marketing initiatives I would say that
they have improved significantly over
the past 12 months and I’m pretty
optimistic on how they look like in the
coming year as well. What attributes do you look for in perspective
engineering hires? The strategy to build
the development team was the same since
since beginning as a company I was
looking for seasoned and experienced
developers interested in the blockchain
tech. About two years ago I created a
kind of you know blockchain guide for
developers these documents that helped
them pick up blockchain tech as fast
as possible and still it takes about a
month of full-time work to get it
through all the docs.
This affects how we build the team, this
affects the approach that we have in the
team actually team consists mostly of
the senior developers who have really
the best experience and processes are
built around their skills bounds our
ability to deliver. And to add to that
point when we did start the company I
was quite focused on finding people to
start building blockchain solutions and
Victor’s the one who convinced me that
the market for talented engineers
especially blockchain engineers was small
what we should do is focus on talented
engineers and within a few weeks they
should be ramped up and ready to code
using the blockchain stack in their
solutions. Yeah that’s true I am in the
blockchain tech for ages you know and I’ve
seen many blockchain developers and out
of my experience
that was the right strategy for that.
Relatedly how do you effectively manage
team communication remotely with offices
in multiple different countries and time
zones with the team being based in New
York, St. Petersburg and Dubai it’s
somewhat challenging to coordinate
between different time zones, geographies
etc, but at all what all boils down to
one thing your commitment and effort to
making it work depending on on which
product we’re working on there’s always
close coordination between the business
team and a tech team and that’s
hopefully gonna allow us to launch
products that are globally accepted and
and have customer base from pretty much
everywhere across the world.
How does securitization of equities fit
into the Jibrel platform and what about
other asset classes? Alright so I think
the word securitisation and tokenization
are sometimes used interchangeably even
though they’re not really the same, so
securitisation is essentially pooling
different assets to create a security we
saw that with the mortgage-backed
securities when the 2008 crash happened.
When you tokenize an asset and represent
it in the form of an Ethereum based
token or any other blockchain it makes
the securitisation process a lot easier
and a lot more transparent because you
can know exactly what asset is
pooled in order to create this type of
security so at Jibrel we’re tokenizing
financial assets so for Jibrel.com we
won’t be doing any securitization it’ll
be tokenization of financial assets. And
the real beauty about this model is
we’ve found a regulator that actually
going to consider tokens equals equity
and that’s the most important
thing and with that we can do a bunch of
other things so we can add new asset
classes using the same model and using
this model you can add commodities,
equities, currencies so it really lines
up to Jibrel’s overall vision. You
asked about securitisation of equities
one interesting way to think about it is
a VC fund is actually a wide range of
pooled different equities so the
tokenization of a VC fund could be
viewed as securitisation of equity.
Where do you think blockchain is going over
the next few years?
First we need to separate blockchain and
products built on the top of the blockchain
when we talk about the blockchain
technology itself what we talk about
it’s Bitcoin, Ethereum, Hyperledger and other
implementations of the blockchain, and
they’re quite not mature and I would
compare these technologies to what
happened for example with e-commerce
technologies 20 years ago. If you
want to launch ecommerce website 20
years ago you had to spend millions of
dollars to build it to develop it and
it’s because there were no libraries,
technologists, tech components, nothing! You
had to build everything everything from
scratch and therefore it required
a lot of time and effort and money. Right
now you can build an e-commerce website
in 30 minutes literally, the same thing
will happen to the blockchain,
right now you have to spend months to
develop a simple app that manages some
unchained data. I think five years along
the road we will be able to build this
kind of apps much faster and much more
efficiently but for now it’s like not a
mature system
and this means that all parts of the
technology stack will have to
evolve, I mean blockchain implementations tools
to work with blockchains to test the
blockchain apps to develop apps
libraries, approaches, methodologies – everything
will evolve and we have quite
interesting five years. And just to add to the
point that Victor made that’s a really
good point is that today’s blockchains
are just not enterprise ready will
today’s blockchain evolve perhaps but
that’s why at Jibrel while we’re
currently building on ethereum we’ve
since day one we’ve kind of iterated
that we have a long term blockchain
agnostic focus and we’d like to keep
that going forward to ensure that we’re
always building on the ultimate chain
that will survive. And also I want to add
that with the current blockchain
implementations you have to build your
entire system around this blockchain
you have to if you have something that
automates your operations you have to
rework it completely to integrate with a
blockchain. In the future I believe approach
will be a bit different it will be more
like an approach with existing
technologies, not the blockchain. In the
future blockchain
implementations will allow you to easily
integrate them into existing ecosystem
into existing infrastructure of
companies without that much effort and
it will speed up and simplify the
adoption of the blockchain. One final
part I’d like to talk about that I
learned from Victor is that future of
blockchains would be used as a data bus
so as a secure mechanism of moving data
around whereas most of discussions have
been about using blockchains to store
data
we believe that block chains will be
very useful in moving data around. I
think regardless of where the ecosystem
is heading one thing we can all agree
about as that the next five years should
be pretty exciting for blockchain and
for Jibrel.