My interest in crypto debit cards comes from the desire to be able to buy my groceries. That would definitely be one measure of success in the utility of bitcoin or any other cryptocurrency.

However, companies like SpectroCoin can be quite expensive in terms of fees and lately have been reducing their limits based on “the change in European Union Regulation 648/2012, known as the 4th Money Laundering Directive (4MLD), which will take force on June 26, 2017and in the latest news “will no longer maintain or issue Visa Prepaid Cards to cardholders outside of the European territory.

The Monaco project certainly looked interesting on the outside. That was until I dug a little deeper and it didn’t start well.

The Whitepaper

Accessing it

A whitepaper is usually the first point of call when trying to understand an ICO but it was no where to be found on Monaco’s website. Googling it revealed a copy though. Why would the whitepaper be removed? Apparently:

Whitepaper was a Token Sale document and the Sale finished in June. We will replace it with a more updated research paper soon that includes new information.”

Should I rephrase the above to: “We don’t have actually have a whitepaper but we have a 32 page marketing brochure. We will write a whitepaper soon once we figure out what we’re actually doing”?

Once I managed to get the whitepaper, the first thing I noticed was huge graphics all over the place.

This actually does looks a marketing brochure. In fact, I copied the contents into MS Word without the graphics and it came to 14 pages.

The contents

The executive summary starts of with some impressive claims.

  • Exchange money at perfect interbank exchange rates using Monaco App

What is the definition of perfect?

  • Send money from Monaco App in 23 currencies to 120 countries worldwide for free

Free? Really?

  • Customer onboarding can be done entirely via the mobile App – a process taking less than 3 minutes

I did this the other day. It actually was very good and fast and I was suitably impressed. However, it’s a mobile app you download and then upload some personal ID and a picture of your face just to go into a waitlist for when the cards come out. Is “onboarding” misleading? You decide.

Section 1.6 is down right awful. Amaturish.

There are MCOT MCO issued.

There are MCOh units of MCO held by a certain holder of MCO.

There are m distinct tokens held in the MCO Asset Contract.

The MCO Asset Contract holds Tm tokens for the m th token contract.

Then the holder of MCO will receive the following vector of tokens upon calling the burn function and choosing to “Redeem and Burn”:

The variables are not clearly defined! I finally understood it, but it wasn’t straight forward. I had to read the example on the next page and then reverse engineer what the author was trying to say!

Ok, down to business. Section 4: MONACO APP & PLATFORM DETAILED OVERVIEW

  • It’s a “proprietary” mobile app on Android and iOS.
  • The card will be issued by some big company that is listed on the Frankfurt Stock Exchange.
  • Their processing platform will be a company in UAE.
  • Their eKYC platform is powered by Jumio based in Palo Alto.
  • They partner with existing “banking rails” (ie banking platforms) for cross border transfers.
  • Cards produced by a company called Gemalto

The Team

The team initially did not update their LinkedIn profile which was called out here. They have since updated their profiles in LinkedIn. Note that the 4 main guys in the team were former Ensogo colleagues.

The revenue model

They way investors can get a return on their money is this:

MCO Asset Contract accrues a 1% licensing fee on transactions using the Monaco Card … MCO holders will be able to access the portfolio through a mechanism called “REDEEM & BURN” (see 1.6).

1.6 At any time, a holder of MCO can “Redeem and Burn” the MCO for their pro-rata share of each token held by the MCO Asset Contract.

In other words, 1% of ALL Monaco transactions will be diverted into a central fund or pool called an Asset Contract, ie a smart contract on the Ethereum blockchain. You can then redeem your MCO tokens for Ether based on the formula in Section 1.6.

Here is a neat write up on the potential ROI with some maths. Warning, it doesn’t look pretty.

An ICO stuff up?

There was a mistake made which caused the following announcement to be made:

Following guidance from TokenMarket and the exchanges, before the token lists, we need to perform an upgrade that will address an incompatibility issue with certain multi-sig wallets. Whilst this is not a major problem, it does require action to ensure that your experience using MCO is the best it can possibly be. Therefore, we will need to re-issue the MCO token before it becomes transferrable to remove this incompatibility and to ensure that MCO can deliver, for many years to come.

This could be interpreted as marketing BS and is actually saying someone screwed up big time and we have to reissue the tokens.

In the end, about 71,392 ETH was raised from over 8,500 individual participants. That’s impressive!

Community discussions

  • Here is an interesting thread where the team responds to some good questions by a community member.
  • Here Kris the Co-founder and CEO acknowledges what could have been done better, in particular why the ICO appeared out of nowhere stating:

why only 1 day notice. It’s actually pretty simple. The single thing that pushed us to launch ahead of our original July schedule was a competitor running towards an ICO with a 90% same value proposition (FX+crypto). Our CFO was at an event at VISA Innovation Centre in Singapore on 11th of May, where he ran into another founder, who basically told him what they’re working on and that their ICO is going to launch in June. We made a judgement call to finish working on our ICO within a week and launch, then spend the next 30 days to gradually build exposure and increase our brand awareness, so everyone has plenty of time to get to know us and do their due diligence.

The reason why popping up out of nowhere is bad is that it leaves very little time for proper research and due diligence. This however hasn’t stopped millions being poured into the ICO.

  • Here is another thread on another smart contract stuff up.

Another perspective on Monaco

Speculative ROI?

What would have happened if you had put 1 ether into the ICO? Back on 18th May 2017, 1 ether was about $95USD. Let’s keep things simple say it was $100 because it appreciated over the duration of the ICO.

If you got in early, ie in the first band, you would have received 150 MCO. The current price of MCO is $8USD so your investment would be $1200USD. The current value of Ethereum at the moment? ~$290.

So investing $100 and getting back $1200 over a period of 4 months is nuts. That represents a ~3,300% per annum increase. ie if I put $100 in a bank and got 3300% interest, I would earn $1100 in 4 months. That is astounding!


The Monaco ICO felt like a school yard project that if something could go wrong, it would… and it did. The idea was ok but the whitepaper felt like it was written by a recent marketing grad student. There were lots of marketing statements that made it feel too good to be true. “Send money for free” and “perfect interbank exchange rates”.

The positives? The mobile app, even though it’s is just a glorified pre-ordering app looks nice on the surface and the different cards they have are quite attractive in design. And of course the ROI even at $8 can’t be argued.

The ROI model is interesting and the returns look very low. I’ll keep an eye on this and look forward to review it again in 6 months time.

All this goes to show how crazy the market was or is and that even with all these stuff ups, they still managed to raise ~$25 million dollars. Imagine if they did things right! In any case, hats of to you boys. You’ve raised $25M more than me so congrats.

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