Explanation of Xangle Credit Report
Hello, This is Berith.
In the credit report managed by Xangle on May 25th, we recognized our weaknesses and matters for improvement.
Although starting with a higher score would be the best, we admit the result of our inexperience in projecting a credit report. Especially, we perceived the differences between what Berith considers important and the elements Xangle prioritizes in the credit rating.
The most unfortunate part of the credit report is that the services and systems under invention cannot be the subject of evaluation. Even the services contracted with major enterprises and systems under development were not part of Xangle’s consideration. Moreover, Xangle’s significant change in credit report standards resulted to be more complex. This affected our evaluation score to be lower than our expectations.
For the upcoming credit report, we promise to prepare proper materials corresponding to the evaluation criteria. Also, about the elements requiring advancement, we will submit additional explanatory materials and data that could not be attached previously due to the contracts between companies.
In today’s posting, we would like to vindicate and explain our position on Xangle’s credit report in detail.
The technology part is evaluated based on three major categories; decentralization, service reliability, and scalability. Xangle has two versions of evaluation criteria, the ‘Mainnet’ and ‘DApp’. Berith has been evaluated for the Mainnet, being rated as the comparative medium of competitive companies including Ethereum, Binance Chain, etc.
Berith mainly operates self-own membership service DApp and BaaS. Although we started the project with Ethereum-based DApp, we have identified limitations such as commission issues and slow transaction processing speed that exist within Ethereum. To solve this problem, we decided to develop a Mainnet that can combine our own DApps.
However, after establishing a PoS-based Mainnet through PoA, we provided more than 10 BaaS-based services such as electronic contracts and NFTs in the form of DApps rather than additional updates of the Mainnet. Then, creating them to API, we focused on implementing them without blockchain technology.
However, it was regrettable that the evaluation criteria were based on the Main net, not the DApp.
In this regard, we would like to reflect the score by submitting evaluation criteria modification requests and additional explanatory data in the future.
Next, we will like to respond about the TPS. At the end of 2021, Berith received a test result value of about 900TPS through Telecommunication Technology Association (TTA), Korea’s top-quality testing and certification organization.
Unfortunately, the test through TTA was scored based on an AWS node for our typical project. If tested with PC, we expect a much higher score may have resulted.
Additionally, in the case of n-million-unit TPS promoted by various blockchain companies, significant differences occur between the promoted TPS and actual ones in the operation. This is because they first set the conditions for obtaining the best value for each, then conduct the test afterward. Moreover, as each blockchain requires different terms, it is impossible to evaluate every blockchain in the same condition.
Therefore, in order to compare the TPS figures for each blockchain, it is most appropriate to compare them through the evaluation criteria from reliable institutions based on the actual blockchain in operation.
2) Token Economics
Berith Mainnet has been operating since February 2019. However, it has been criticized for low on-chain activity including the number of transactions and new wallets. As only a few cases showed the active use of BaaS, we are also unfortunate for not using the early stages efficiently.
However, we regard the times as a stepping stone to attract new businesses and secure practical use cases. In fact, blockchain-based services using Berith BaaS such as Samsung Display, Lotte Precision Chemical, and CJ CGV are being successfully provided.
We will elaborate further on the transaction figures of 81,045 in the three months which were mentioned additionally.
Currently, the majority of transactions occurring in Berith’s Mainnet public blockchain are the ones from electronic contracts such as CGV NFT and Samsung Display. In the case of these contracts, a public blockchain and a private blockchain are mixed and used.
In fact, after millions of transactions have occurred through the private blockchain, the data recorded on the private blockchain is processed into publicly available information. Because only the processed information is currently recorded as a transaction of the Berith Mainnet Public Blockchain, approximately 80,000 figures are only confirmed as of three months.
If we include all the transactions recorded through the actual private blockchain, the number occurring in Berith’s blockchain is expected to be about 5.8 million in three months. However, regarding private blockchain transactions, it is hard to submit evidence without consultation with contracted companies.
Once this has been clarified, we expect that the evaluation of the on-chain activity will increase.
In addition to the companies using Berith Mainnet for their blockchain services, we are continuously inducing real cases that have not been opened, such as contracts completed and contracts still underway. Thus, the evaluation will increase by providing additional information.
On the other hand, Berith is establishing policies to reduce risks to external regulations by securing our decentralization. As a representative example, the Voting function has been updated to beta test. We will also mention the details in a later post.
3) Milestones & Performance / Financial Health
Currently, the sales and operating profit of Berith Korea, the operator, and IBIZ Software, the developer, are continuously growing. In terms of actual sales, it grew about 6% compared to 2020, and the operating profit, grew about 160% compared to 2020.
Moreover, as Berith Korea, a Start-up company still needs a stabilization period, the existence of IBIZ software generating stable sales and profit every year will serve as a pillar for Berith’s project to grow steadily in the future.
About the Mainnet profit mentioned in the Xangle report, we would like to give more specific information.
Currently, all sales generated by BaaS operation in Berith Korea are paid as the usage fee for Berith Mainnet. Since it is a long-term renewal contract including maintenance, etc., we believe the constant increase of the sales profit.
The expression ‘meaningful’ signifies that there is no revenue to occur on Mainnet itself. However, after the official launches of the NFT marketplace and other services under development, the Mainnet-based sales are expected to be generated
Moreover, the representation of service sales is different from reality, and I’ll go into more detail.
Founded in 2018, Berith is currently a startup-level company, and it is achieving the high performance and credibility desired by large companies. As a solution, we contract BaaS services with major companies through our developer, IBIZ software, as well as BaaS services development and continuous support. As the sales are the consequence of these situations, it is different from simple service contract sales.
In addition, IBIZ software does not spare support for Berith and runs together, pursuing the coexistence of two businesses.
Lastly, the unfortunate evaluation regarding our own open system ecosystem is the consequence of being assessed focusing on the Mainnet. (As mentioned earlier, our major field is DApp). For this case, we will show constant effort to change the evaluation criteria and develop DApp, looking forward to receiving a better evaluation in the next round.
First, Berith is about to introduce governance in order to improve the centralized decision-making structure. As the voting function development is almost completed at the alpha stage, you will soon be able to see the development of the current Berith Wallet. Through this, we will receive various suggestions and hold events related to suggestions and Voting. Moreover, we will improve the centralized decision-making structure and allow users to create and participate in our operation.
Second, as for the current state of slow communication, we would like to apologize before everything. In order to stay stable in this unpredictable market, Berith first appealed to the B2B market and created the basic foundation for us to grow on our own. In this process, a lack of communication occurred, and we now promise to communicate more actively with the community through personnel supplementation and allocation of the budget.
Also, starting from June, we will actively share information about the technology and business of Berith in the monthly report format.
5) Qualitative Evaluation
Lastly, the qualitative evaluation will be carried out on a DApp basis rather than the Mainnet. Thus, we expect the result to be higher in the upcoming evaluation.
Today, we shared additional explanations regarding Xangle’s credit report, which may seem disappointing. For the next evaluation based on ‘DApp’, we promise to prepare as thoroughly as possible for the deficiencies and try to receive an improved report result.
In addition, there are several credit assessment enterprises, and not all their rating criteria are the same. Thus, we are looking for agencies who can evaluate, admit and refer to Berith’s diverse achievements, technology, and ongoing projects as well as potential.
We apologize again for giving some disappointment. With the lessons we learned through the evaluation, we will continue to work harder and step ahead.
Thank you for all your wait and support.