OmiseGo Review 2018: Should You Invest In OMG?

OmiseGo has become one of the most anticipated cryptocurrencies of 2018. 

But how it does work, why is it unique and how did OMG start?Well, there’s still a few things you need to know about this coin that most people won’t tell you.

So in this OmiseGo review, we’ll look at OMG’s pros, cons and future roadmap.

Read on or skip to the section you’re interested in.

1. How OmiseGo Works.

1.1. What Is OmiseGo?

So OmiseGo (OMG) doesn’t have the same brand recognition as Bitcoin or Ethereum.

But that could change as we progress through 2018.

It currently sits in the top 50 cryptocurrencies by total market capitalisation.

OMG has built teams across Japan, Indonesia, Singapore and Thailand. 

They’re mainly targeting the South East Asian market – as we’ll discuss later in this review. 

Plus they’ve already announced high profile partnerships with companies such as McDonald’s Thailand.

So what actually is OmiseGo – and how does it work?

OmiseGo is basically a payment platform designed to process peer to peer payments.

Think of them like the cryptocurrency version of Stripe or PayPal.

Their overall aim is to make it easier for businesses and merchants to accept digital payments in both cryptocurrency and fiat.

1.2. What Problem Does OmiseGo Solve?

Cryptocurrency still hasn’t really hit the mainstream.

Sure, most people have heard of Bitcoin – but they don’t understand how it works or why it’s useful.

So imagine just how difficult it is right now for businesses to accept cryptocurrency payments – especially in South East Asia.

There’s not really an easy way to integrate cryptocurrency transactions with a business.

Stripe previously accepted Bitcoin but they’ve now ended their payment support for the cryptocurrency.

Therefore OmiseGo is potentially solving a huge problem.

1.3. Changing The Banking Industry

The South East Asian banking industry is one of the fastest growing financial markets in the world.

So OmiseGo’s blockchain technology is being developed at the right time. 

You have to realise that just under 75% of people in South East Asia don’t have a bank account, which presents an opportunity.

This demographic is known as ‘the unbanked’.

And as you can see in the chart below, a large part of the world is still unbanked.

Source

The other problem with South East Asia’s financial system is that it’s very fragmented.

It’s not easy to link international payments together. So that’s a problem OmiseGo could address nicely.

You see, OmiseGo doesn’t require a bank account to use.

And in a world where so many people are looking for PayPal alternatives and other banking solutions, OmiseGo is a great option.

So it’s an easy solution for people living in SE Asia.

Plus economies around Asia are growing rapidly. 

These improvements in wages, living standards and business prospects all offer more opportunities for OmiseGo’s platform.

2. OmiseGo’s Technology.

2.1. Key Features

So what makes OmiseGo’s technology unique?

The OmiseGo token is based on Ethereum’s network.

It promises some impressive key features including:

• Low transaction fees
• Fast payments​
• A payment platform for both Fiat currency and cryptocurrencies
• A strong team of experienced blockchain developers (including Ethereum’s founder)
• Scalable, high volume transactions

2.2. The Team

It’s undeniable, OmiseGo is a really ambitious project.

In fact, Vitalik Buterin himself (founder of the second biggest cryptocurrency Ethereum) is on the advisory team for OmiseGo.

That’s a positive sign of their potential. 

But before we get overly excited, let’s look at their roadmap first.

2.3. Roadmap

Here’s an overview of OmiseGo’s roadmap. 

Source.

Their roadmap might look a little complicated but essentially OMG is developing their platform to become highly decentralized and scalable. 

They’re also planning a transition from Proof of Work (POW) to Proof of Stake (POS) mining.

2.4. Plasma Protocol

The Plasma Protocol is one of the main upcoming upgrades in OmiseGo’s technology.

This development could make the cryptocurrency far more scalable.

And the more scalable a cryptocurrency is, the more likely it can achieve mainstream adoption. 

As an Ethereum token, OMG can only transact 15-20 transactions per second. That’s not a lot.

But if their Plasma Protocol is released, the upgrade could allow around 1 million transactions per second.

2.5. SDK Wallet

There’s now a Software Development Kit (SDK) for OmiseGo’s wallet, meaning it’s open source.

So why is that useful?

Well, it’s now easier to develop your own wallet from the OmiseGO blockchain.

Developers can create their own reward systems, loyalty systems and remittances, all whilst accepting payments in OMG tokens.

3. The History Of OmiseGo.

3.1. ICO

OmiseGo is relatively new to the market.

Launched in Q2 2017, they raised $25 million from their Initial Coin Offering (ICO).

The ICO sold 65% of OMG’s total tokens, including pre-sale donations from Microsoft.

Unlike most ICOs, they actually capped the amount of investment they received.

Source.

So whereas ICO’s such as EOS raised over $185 million dollars, OmiseGo capped their funding at $25 million because that’s all they needed to launch the project.

That’s a sign of their credibility.

Rather than accepting an unnecessary amount of funding, they limited donations to avoid over-inflation.

3.2. Who Are Omise?

OmiseGo is part of the Omise group.

Before entering the cryptocurrency market, Omise were already developing payment technology solutions in Asia.

Founded in 2013, they’re working with 400 merchants across Japan, Thailand, Singapore and Indonesia.

The problem with most ICO projects is that they’re typically founded by inexperienced teams.

And less experience means more risk.

In fact, ICOs have become infamous for raising vast sums of money without ever delivering on their promises. 

In contrast, Omise is tried and tested – which is a positive sign of their credibility.

Omise has an experienced team, and they’re already respected as experts in the payment technology space. 

But will that experience pay off?

Well, if you’ve ever come across some of the big ecommerce companies like WooCommerce or Magneto, then you’ve probably already seen just how useful the Omise technology is.

3.3. OmiseGo Airdrop

Owners of Ethereum during July 2017 were airdropped OmiseGo tokens at a rate of 0.075 OMG per ETH.

This airdrop campaign aimed to boost awareness of the OmiseGo brand and increase it’s adoption.

3.4. Price Chart

If you’re investing in cryptocurrency already, then you know that the market has been flooded with bad news in 2018.

As a result, OMG’s coin value has dropped substantially.

You can see OmiseGo’s pricing history below:

Despite announcing new updates and client partnerships, OmiseGo’s coin value has still struggled to reach it’s previous peak.

Whilst their price might recover, it really depends on how scalable their technology becomes.

If OMG’s technology doesn’t progress, then they’ll struggle to land new merchant partnerships.

4. Why You Should Invest In OmiseGo.

• checkCredible Team: Unlike other cryptocurrencies on the market, OMG isn’t just a bunch of teenagers starting up an ICO from their garage. They have a professional and experienced team of developers dedicated to this project. 
• checkExperience: They’ve worked on payment projects before – and succeeded along the way. That’s a promising sign of their capabilities as a business.
• checkTheir Wallet: OmiseGo has already launched an SDK decentralised wallet. That means you’ll be able to trade without the typical problems of most mainstream exchanges – such as phishing, hacking and third party intereference.
• checkMinimal Transaction Fees: The OmiseGo technology is very efficient and it’s designed to offer low fees for transactions and transfers – whilst remaining extremely fast. That means it can be scaled up to high volume transactions and become more mainstream.
• checkTheir Clients: After announcing high profile partnerships with clients like McDonald’s Thailand, you can see they’re ambitiously working towards becoming one of Asia’s leading cryptocurrencies.
• checkRemoves The Middle Man: In Asia, there’s a lot of customers and businesses who don’t use banking – which means they’re cut off from the financial world. OmiseGo removes the need for a bank account – so they have a strong use case.
• checkAccepts Fiat: One of the biggest reasons why altcoins haven’t gone mainstream yet is because most people – and investors – don’t understand how to buy cryptocurrency. The OmiseGo platform allows users to trade cryptocurrency with fiat, removing the complications and intimidating environments of typical crypto exchanges.
• checkFirst Mover Advantage: The digital payment industry is huge – and if you factor in most of Asia then you’re looking at billions of dollars in market share. This will be a very competitive field, but OmiseGo has the first mover advantage before their competitors have a chance to swoop in.

5. Why You Shouldn’t Invest In OmiseGo.

• closeIt’s A ‘Sleeping Giant’: OMG is a slow burner – it’s a ‘sleeping giant’ that depends heavily on the success of it’s technology. Plus it’s price has already taken a big hit this year.

• closeIs It Too Ambitious? OmiseGo could literally change the landscape of banking in South East Asia. But the bigger the project, the more potential for hiccups and problems along the way. It could be a long time before OmiseGo reaches it’s full potential, which is something to be aware of.

• closeIt’s Still Just A Concept. As exciting as OmiseGo is, it’s still just a vision. If you invest in OmiseGo today, you’re gambling on their speculative future potential. 
• closeThe Danger Of Investing In Cryptocurrency. As we’ve seen in 2018, the cryptocurrency market as a whole is incredibly risky. We’re currently in a bear market where investor optimism is very low.

6. OmiseGo Storage & Trading.

6.1. Where Can You Buy OmiseGo?

OmiseGo is available at most major cryptocurrency exchanges.

If you need a step by step guide on how to trade altcoins, check out my tutorial on how to use Binance here.

6.2. How To Store OmiseGo

Due to the hacks on many cryptocurrency exchanges, it’s not safe to leave your investments on an exchange.

Instead, I’d recommend storing OmiseGo on a hardware wallet.

As an ERC20 (Ethereum) token, OmiseGo is compatible with most hardware wallets. 

6.3. OmiseGo Staking

OmiseGo is currently mined via Proof Of Work. 

However, they’re planning to move towards a Proof of Stake model later this year.

This will reward users for holding tokens long-term and potentially avoid the risks of a 51% mining attack.

7. The Vision Of OmiseGo.

7.1. Payment Decentralization

Like most cryptocurrencies, OmiseGo’s technology is still in it’s very early stages.

But their vision is exciting.

The idea of accepting payments from a completely decentralised, peer to peer network could appeal to many.

7.2. Targeting South East Asia

I also like the way they’re targeting South East Asia’s fragmented financial industry. 

Source.

Their proposed payment model looks appealing.

OMG will process payments via their decentralized peer to peer network – rather than an institution. 

That means no third party interaction.

Plus, there’s a lot of consumers that don’t really want to deal with the traditional banking system, especially in South East Asia.

A lot of people just don’t want the hassle of banking. 

That’s understandable with the arduous verification systems, admin and paperwork often involved with bank accounts.

7.3. Sending Money Overseas

A lot of people from South East Asia migrate and work between countries:

For example, they’ll come from Thailand, but work in Japan.

Now if they want to send money back home, it’s extremely costly.

Today, international payment options are limited.

Most people turn to merchants like PayPal or Western Union – but they’re really expensive – whereas OmiseGo is offering an easier, cheaper alternative.

Source.

OmiseGo allows international transfers to process at a cheaper rate and in less time.

That’s a major selling point.

This is even more appealing when wages across South East Asia are typically lower on average – compared to the Western World.

8. OmiseGo’s Opportunities.

8.1. Business Model

OmiseGo’s payment systems fits in with the rising growth of digital payments.

So I’d say OmiseGo’s business plan is one of the most impressive within the cryptocurrency space.

However, they’re still in their very early stages – OMG definitely isn’t ready to achieve mainstream adoption just yet. 

8.2. Growth In South East Asia

The OMG business model mainly targets South East Asia.

This region is growing at a fast pace, creating more opportunities for OMG’s adoption. 

(As you can see from the chart below.)

Source.

Here’s a few statistics around the financial industry in SEA:

• SEA countries such as the Philippines and Vietnam are achieving annual growth rates of 6% – some of the highest in the world
• Their technology, trade and manufacturing industries are all expected to grow substantially over the next few years
• Foreign investment is also rising in SEA and fuelling the region’s growth

8.3. Partnerships

Merchant partnerships are the key to OmiseGo’s growth. 

If they can partner with large corporations, their payment platform will rapidly increase in adoption.

They’ve already announced partnerships with McDonald’s Thailand, MakerDao, Siam Cement Group, DTAC and the Pizza Company.

I’d expect OMG’s list of partnerships to grow as their technology develops.

8.4. Influencer Marketing

OmiseGo is backed by some of the biggest influencers in the cryptocurrency industry.

The founder of Ethereum (Vitalik Buterin), one of the world’s most successful cryptocurrencies – has backed OmiseGo as his favourite token system.

Check out his tweet below:

This is a major selling point – because it shows just how much confidence he has in their team. 

9. OmiseGo’s Threats.

9.1. Competitors

As we’ve discussed, the financial industry in SEA is highly fragmented.

There’s a lot of competition – not just from cryptocurrencies but also banks and financial institutions too.

There’s only room at the top for a few major payment platforms – so will OmiseGo gain enough market share to be successful?

Let’s look at some of OmiseGo’s main competitors:

• Stellar: Stellar (XLM) is another major competitor to OmiseGo. Stellar’s already partnered working with IBM and developing a scalable international payment solution.
• Banks: Cryptocurrency isn’t just limited to tech startups. It wouldn’t surprise me if banks begin developing their own blockchain platforms to counter firms like OmiseGo. Plus they’ll have more political influence and financial backing to gain market share.
• Ripple: Ripple actually has more brand recognition than OMG. It already sits in the market’s top 10 cryptocurrencies by total market cap. 

9.2. Their Technology Is Very Speculative

The OmiseGo platform is just getting started – and it still has a long way to go.

Sure, they’re promising a lot of interesting features – such as the Plasma Protocol and making OmiseGo POS.

But any investment value now is highly speculative.

Plus, if their technology doesn’t scale properly then their business model will struggle to become profitable.

After raising $25 million dollars in funding, it’s time for OMG to deliver on their promises.

9.3. Regulations & Legislation

One of the biggest threats to OmiseGo’s success is the increasing regulation of the cryptocurrency market. 

If Government’s and major financial institutions feel threatened by cryptocurrency platforms, they’re likely to take action.

It’s the main reason why the market has crashed this year.

Also, if the cryptocurrency industry becomes tightly restricted by legislation, then it’s going to become increasingly difficult to expand.

Subsequently, market growth opportunities will be limited.

We’ve already seen major cryptocurrency regulations come into play in 2018 – such as:

• India’s central banks have pulled their support for cryptocurrency related businesses
• China has banned cryptocurrency trading completely
• US banks now decline any credit card payment for cryptocurrency – making it harder for US consumers to purchase cryptocurrency

Unfortunately, I can only see this trend of regulation continuing. 

However, whilst the future for OMG remains uncertain – it’s potential is still exciting.