OilCoin Launching for Smarter Trade in Oil

The recent meteoric rise in the value of Bitcoin has turned many heads in many industries and as well as extensive coverage from various global media outlets.

It appears that the currency is rapidly gaining traction as confidence in cryptocurrencies on a wider scale is beginning to solidify, encouraging their emergence for use in narrower niches. One such cryptocurrency is OilCoin, which unlike Bitcoin has tangible backing: crude oil.

Spurred on by this rapid adoption, OilCoin is nearing its final readiness stages. Announced in December, it is based on the same blockchain technology as Bitcoin, but focusses exclusively on the oil industry. According to the group of inventors who are driving this currency, which includes banking and technology managers as well as the former Commissioner at the US Commodity Futures Trading Commission Bart Chilton, the coins are an attempt to tokenise barrels of oils, with one coin representing the value of one barrel.

One of its selling points is how it is claimed to be the first legally-compliant digital currency based on a digital asset. By buying a token of the cryptocurrency, the buyer pays the current oil barrel value for it in real life currency, which they can later exchange for a barrel of oil or other oil-related assets. This price will be regulated by authorities, with the hopes of being recognised as the safest and most trustworthy digital currency in the world.

OilCoin and its initial coin offering is expected to complete its launch in January 2018, when it will be available for public sale. This public availability is one of OilCoin’s key features, the group argues in their published white paper: “By linking each OilCoin token to existing and verified real world assets, OilCoin enables holders of digital and fiat currencies seeking to preserve wealth, lock in gain and/or avoid loss to acquire, hold and transfer intrinsic value in digital token form.”

As a step to smarter trading in oil, Dashboard supports this initiative with great enthusiasm. Challenges are obviously to be anticipated, however OilCoin is expected to eventually stabilise and prosper as an attractive investment. It will be interesting to see how the first legally compliant cryptocurrency will be met by different groups, especially one intended for the public domain from an industry typically exclusive to the private sector, and so we anticipate the launch with great excitement.