Populous Cryptocurrency Review

What is Populous?

Populous is a blockchain based peer-to-peer platform for invoice financing (used for asset-based lending products that allow companies to finance slow-paying accounts receivable).

By using smart contracts, buyers and sellers can exchange invoices through auctions.

For SMEs (small and medium-sized enterprises), Populous appears as a suitable gateway to take part in invoice financing.

One of the major problems many SMEs have to face is to maintain a persistent cash flow. In the UK, small and medium-sized businesses have to count more than $2 billion as fees for late invoice payments every year. With the help of invoice financing, sellers can make quick cash by selling their invoices.

Populous utilizes XBRL data, Altman Z-score formula, and blockchain tech in order to spread invoice financing throughout the world.

Working protocol of Populous

Invoices are exchanged between buyers and sellers through auctions via smart contract. To sell invoices, seller companies have to wait for the administrator’s approval after getting registered. Getting approved, the companies submit invoices and fix a minimum sales goal which requires the approval of the Populous administrator as well.

eXtensible Business Reporting Language (XBRL)

The credit risk associated with the invoice is analyzed by Populous with the help of Altman Z-score formula on real-time XBRL data which is available publicly. This data includes information like the value of debtor’s, the creditors that are due within a year, and the total amount of value available.

Altman Z-score formula

Populous has constructed an in-house credit rating system of its own using the Altman Z-score formula and XBRL data. Thus, the Populous team saves both time and money by avoiding affairs with external credit agencies.

Being a tool for financing modeling, this particular formula projects on three risk factors:

1. Possibility of an organization to go bankrupt within next two years.
2. Probability that the organization will default on its obligations.
3. Capacity to avoid financial down-flow by taking necessary steps.

This formula is a fruitful method for the administrator to decide if the invoice of a company should be approved or not.

Fate of the Invoices

The invoices of different companies embrace the following results:

1. The provided sales goal of the invoice is met by a bid within 24 hours and the auction ends successfully.
2. No bid may reach the sales goal within 24 hours. In this circumstance, they seller can conclude the auction, accept the bid proposing the highest value, or again start the auction.
3. The seller can cancel the auction before 24 hours. In this case, the seller is at liberty to agree with the highest value offered or to call it a day.

Tokens of Populous

• Pokens

Pokens are ERC-20 tokens acting as the inner currency of the platform. The value of Pokens is directly pegged to the value of fiat money. For example, 1 GBP Poken is equivalent to 1 GBP. Users can by Pokens in exchange for GBP, EUR, Yen, and USD. In order to purchase Pokens, the other currencies are to be converted to GBP following the exchange rate of the London Stock Exchange. Users will also be able to purchase pokens using supported cryptocurrencies such as Bitcoin, Ethereum etc.

• PPT

Populous Platform Token, PPT in short, is considered as the collateral for the investment. These tokens were launched during the ICO of Populous. The limit of total volume of circulation is fixed, 53 million PPT.

Where to buy and to store PPT

PPTs are available in exchanges like Binance, EtherDelta etc. GDAX and Gemini provide Bitcoin or Ethereum required to get PPT from Binance.

Tokens can be stored in ERC20-compatible wallets such as MyEtherWallet, MetaMask etc. Hardware wallets such as Ledger Nano-S, and Trezor are recommended for ensuring higher security of the tokens.