When Andrew Zimine and Aleksey Sitnikov drafter the first vision of the Exscudo Ecosystem, they couldn’t imagine the full potential of the Channels app. This is the story behind the development and vision of one of our key products.
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What Is Channels
Before we get to the most interesting stuff let’s get the formalities out of the way.
Channels is one of the core products in the Exscudo ecosystem. It is a mobile wallet and a secure messenger that allows users to chat, send messages or make video calls. All that without leaving traces of information on 3rd party devices.
Users can also hold and manage a variety of currencies and get access to advanced financial products. But let’s hear it from the words of Exscudo founders, Andrew Zimine and Aleksey Sitnikov.
Channels As The Ultimate Communication Tool
When Andrew and Aleksey decided to create Exscudo, they put up the first draft of the ecosystem all the way back in 2015. Their idea was simple at its core, yet very complicated in nature. Make a financial product that bridges cryptocurrency and traditional ways of value exchange.
“I told Aleksey ‘There is a huge problem here. Money transfers get lost. There is bureaucracy, the very nature of traditional finance stops economic progress. And we actually have the experience and the technology to make a change’”, recalls Andrew Zimine.
The task at hand was very complex.
“The traditional financial ecosystem has been evolving for thousands of years. It is a result of constant changes each made to ensure it’s a more or less smooth operation. We all know that it is far from perfect, but it is operational. ” says Zimine.
“The goal was to make a product that puts the rights of a human being before anything else. Respects privacy and, above all, security” adds Aleksey, who is in charge of the technical aspects of Exscudo.
Founders realized that to make their vision happen they would need several products working together. As it happens in traditional finance.
“We envisioned Channels as your interface of interaction with the ecosystem. It needed to serve in the place of a bank branch where you can get serviced”, explains Aleksey. “You would be able to hold and spend currency and communicate with contacts. Channels. We envisioned Channels as the ultimate communication tool”.
But it became so much more.
Unbanked Population Is a Real Problem. And an Opportunity
Over a third of adults in the world don’t use standard banking operations. Furthermore, two billion people worldwide don’t have access to banking infrastructure. This problem is especially evident in Asian and African countries. For example, India is home to the second-largest unbanked population in the world.
At the same time, 5 billion people worldwide are already using smartphones. And this number is growing. Let’s take India for example again. Experts forecast that the number of smartphone users will rise by 84% to 859 million by 2020.
And smartphone ownership today is growing in developing economies and in western countries. And it is growing fast.
By tapping into the unbanked population there is a 380 billion dollar market to be unlocked.
Channels as A Tool For The Unbanked
The unbanked don’t have to resort to using traditional banks, right? Brick-n-mortar banks have a problem — opening a presence in a new market is a very slow and expensive process for them. That is not the case for Exscudo.
“In early 2018 we’ve almost completed testing of the original vision of Channels except for plastic cards and some other features. That is when we understood that there is much more potential there then what we thought.”, says Andrew Zimine. “We could do even more than bring together crypto and fiat. So our research and development team started looking into this giant new market”.
Founders realized the potential behind their creation, but it was just the start.
“It took us months to complete market research and check our financial models. We looked at our technical readiness and concluded that we have the resources to take Channels to the next step”, adds Alexey Sitnikov.
One Does Not Simply Go And Make a Banking Alternative
“Channels was supposed to be a wallet and a messenger, right? A wallet that allows you to spend crypto anywhere is already almost revolutionary. But banks have more advanced products. Like deposits and currency exchange”, says Zimine.
So the team started working in this direction.
“We already had a solid base. We have a secure and fast blockchain and working colored coins technology. It wouldn’t be impossible to add financial products that are typically reserved for banks”, recalls Sitnikov.
And we did add them.
“A typical cryptocurrency wallet allows you to send and receive coins. And that’s about it. With Channels, you can exchange currencies, make deposits in 3 currencies. Even move fiat funds to and from bank accounts. There is a lot you can already do with our app”, says Zimine.
But there is more.
“We have the technology to add other functions like loans and mortgages to the app. If business research suggests that we need a certain function to make Channels viable, we have the means to add it”, assures Alexey Sitnikov.
Channels as an Everyday Life Tool
But you don’t have to be unbanked to enjoy Channels. Let’s talk about communication.
“Whenever there is an exchange of information over a network — there is a chance that it will be compromised”, tells us Sitnikov. “This chance is especially high when that information has to go through a centralized database, like with most apps.”
Every day people are falling victim to hackers who gain access to their devices through messengers apps. Even popular platforms like WhatsApp are not safe.
“Channels uses peer-to-peer encryption and all data is transferred through blockchain. Your private details are completely secure. Even the team can’t access them if we wanted to. That’s how we designed it to be”, adds Alexey.
Moreover, we all send and receive money all the time, right?
“Did you know that a standard interbank transfer can take 2-4 days? And that you can only send money during the working hours of your bank? This is not the case with Channels — if you send money to another Channels user, they will receive them within minutes. And it doesn’t matter what time of day it is or where the recipient is in the world”, tells us Andrew Zimine.
“There are other options on the market that give similar functionality for fiat operations and fast value exchange. But a lot of them operate in the grey legal zone and using them is sketchy. Our legal team did a lot of work to ensure the legality of Channels. If you see our app on the App Store or Google Play Store you know that it is legal to use in your country”, remarks Aleksey.
What is next for Channels
“We have some very exciting updates planned that will make the app even more useful and reinforce our vision. It’s too early to share the details but I can tell you that some important additions are already being tested in the company”, says Zimine.
He continues “Of course there is still a lot of work left to do. Two billion unbanked don’t know that they should be using Channels yet. We have prepared a marketing strategy to reach our audiences. Right now our focus is shifting from development to marketing”.
We hope that this article gave you some “behind the scenes” insights into the development of our app. It is safe to conclude that Channels is already a safe, legal and fast platform for financial operations and it will be even better in the near future.