Attempting to disrupt the traditional world of money and banking once warranted eyerolling and sceptical rebuke. However, in the last 10 years we have seen increasingly more start-ups and entrepreneurs tackle issues in finance that were previously considered status-quo.
We’ve seen the inception of an entirely new asset class, cryptocurrencies, changing the way we think of currency transactions and purchase power parity. Blockchain showed us how we are able to build networks of trust and validation that can replace outdated protocols such as SWIFT. Digital banks like Revolut and N26 are making retail banking easier than ever before, while Robinhood brought commission-free stock trading to millennials, making investing cool again.
Based out of Vienna, Austria, Morpher aims to bring it all together in a trading experience like no other.
Backed by Silicon Valley’s Draper Associates, the company offers a trading solution that allows the user to trade any asset of their choice with no fees or commissions, 24/7 trading capabilities, and infinite liquidity.
Normally, retail traders enjoy little access to the exotic markets of commodities, real-estate, or foreign equity. These markets come associated with a myriad of fees that ultimately add-up and impact investor performance.
“The investing industry consists almost entirely of middlemen who charge obscene fees for bad service. Brokers, exchanges, and index funds generate over 250b USD in fees annually – in the US alone.” – Morpher’s founder & CEO – Martin Froehler – describes.
What makes Morpher unique, and grants it the diverse capabilities unseen on any other platform, is its decentralised nature. Morpher is built on the Ethereum blockchain, where it hosts its own ERC20 token which morphs/emulates the price action return of any market by employing smart contracts. The user stakes the Morpher token on a market’s performance; subsequent gains are reflected by the smart-contract minting new tokens for the user, while losses destroy the token. The underlying market is never traded and only emulated; which allows users to go Long or Short, and trade fractionally.
Due to Morpher’s virtualizing capabilities users are able to view markets in a more holistic way. Pre-market trading becomes as simple as trading during the intraday session, albeit less exciting. Trading on the weekends, while prices effectively flat-line, allows users to hedge risks; entering and exiting positions on a whim as soon as any news strikes.
Morpher also opens up the doors to responsible risk management. When high-priced stocks become desirable to trade many smaller retail investors find themselves overweight in certain sectors. Fractional trading allows users to manage the allocations of their portfolios in any way – building a well diversified cross-asset portfolio at just a fraction of the traditionally required capital.
Democratising finance is at the core of Morpher’s mission. Traditional finance lends itself to inequality by design, whether it’s through inefficient bureaucracy that limits investors’ freedoms, or corporate greed that adds layers of fees on the end user. Giving investors the right tools, circumventing middlemen, isn’t enough for the team at Morpher – it’s about changing the way we think of investing.
Most recently the company has opened up it’s doors to users with it’s open-access alpha. Users are able to paper-trade and test functionalities on the test-net. Some of the more interesting assets found on the platform, which you won’t find anywhere else are housing price indices and bond yields.
Martin Froehler explains: “Morpher turns data into markets. We can create entirely new markets that simply do not exist yet or are currently too illiquid to trade. Examples of such new assets are corporate fundamentals, real estate prices by region, consumer price indices, or bitcoin transaction costs. The possibilities are limitless.”
Like most disruptive fintech start-ups, Morpher faces challenges – not in convincing investors and traders – but rather on the regulatory front. Despite the fact that Morpher’s sidechain offers more transparency and security than any existing broker or exchange, regulatory bodies such as the U.S. SEC still struggle in reaching uniform definitions for concepts such as “sufficient decentralization” and “tokenization vs securitization”. In Europe, however, Morpher’s path to compliance is clear.
The company is now on track to a full release on the main-net in Q4 2019. We highly encourage users to check out their website for further information, and give their advanced trading features a test.