Layer Protocol

Layer is a global decentralized reputation protocol that connects sharing economy providers. It consists of a reputation and rewards engine and a token called LRX, which work hand-in-hand to let asset providers within the sharing economy record positive and negative rental behavior in a normalized manner. LRX also has built in arbitration and voting engines, driven by the LRX tokens, to help with self-governance.

Rating: 3.6

Official contacts
Location: N/A
Web-resources:   Whitepaper Website
Social networks: N/A
Product source tracking: N/A
Details Description Risks Full analysis Team

Detailed review

Stage of product development
The complete protocol release is planned for Q1 2019. The given roadmap is not quite detailed and does not explain when the Testnet will be launched.

Token description
Pre-ICO date
ICO date
Token price
Private Round 1: 30% Bonus (3 month lockup after crowdsale)
Private Round 2: 20% Bonus (3 month lockup after crowdsale)
Public Sale: no bonus (no lockup)
Hard cap
Capitalization of token pool
Token distribution date
Consensus method
ICO currencies
Bounty camping
Token functions
LRX, a token that provides the economic incentive for scalable computation of reputation scores through master nodes, encourages adoption of the protocol, and drives community governance.
Tokens distribution
Token Sale (40.0%)
Team & Advisors (15.0%)
Company Reserve (30.0%)
Community (15.0%)

Universal reputation protocol might get low adoption due to the existence of reputation protocols on each platform.


Roadmap is not detailed and does not explain when the testnet will be launched. Now there is neither demo nor MVP available. The process of protocol integration into existing blockchain platforms might be complex and lengthy.


Users might not want a universal reputation system, as if you have a series of bad experiences with malicious actors on one platform, it could affect you using other platforms. There is no information on the business model.


Further details of the use of proceeds categories are not specified. The lockup scheme for the team tokens is unclear.


Now it is unclear how many people work on Layer Protocol development. 2 out of 3 co-founders do not mention neither Layer nor Pin Protocol as a workplace on their LinkedIn accounts.

Full analysis

The growth of the sharing economy is accelerating, now impacting many sectors in many ways. The European collaborative economy market – as defined by these five sectors (accommodation, transportation, buying or selling of goods, on-demand professional services and sharing or renting of goods) – facilitated €27.9 billion worth of transactions between May 2015 and May 2016, with an estimated 191m citizens engaging in at least one transaction involving payment. Shared transportation market is expected to expand from $70 billion in 2016 to $350 billion TAM(Total Addressable Market) by 2020, according to Mastercard and UBS research. Layer Protocol has several competitors. It will directly compete with HubToken and indirectly with Sovrin and uPort. None of them has already conducted ICO. Hub already has a large community of 63K members.


There is no link to GitHub, so it is unclear when the product development has been started and how much progress was made since the start. Currently, there is neither demo nor MVP available. The team says that parts of the backend code are now employed in "Spin" application. The complete protocol release is planned for Q1 2019. The given roadmap is not quite detailed and does not explain when the Testnet will be launched. Layer aims to create a complete protocol built on the blockchain that gives sharing economy platforms and their users a universal, decentralized reputation system. Layer Protocol distinguishes 3 types of system participants: service providers (companies or individuals), users and nodes (Layer Nodes), which ensure the operation of the Protocol and reputation calculation. Each of the providers will be assigned a category (PC) depending on the type of service. The interaction of suppliers and users will be through smart contacts in Ethereum network. Each of the participants, depending on the previous actions, is assigned a "reputation rating".To calculate LRS, Layer Nodes system is used. This system works using master nodes. Layer will be first adopted by Spin, North America's personal mobility company. Spin operates in 26 markets and has served over 650,000 rides in just 6 months.

Business model

Now it is unclear how Layer Protocol will earn money. There is no information on the business model.


The team aims to attract $15 million during private sale round, selling 40% of the LRX tokens. This gives a company post ICO valuation of $37.5 million. HubToken cap is expected to be $100M. Considering potential scalability of the product and competitors valuation, the sum does not look overvalued. The use of proceeds is planned to be as follows: 10% Operations & Overheads, 30% Engineering, 40% User acquisition, 20% BD & Partnerships. Further details of the categories are not specified. There are 3 rounds for raising investment. The first round already finished: the cap was $10M and 30% bonus. Now, the second round is in progress: it has a cap of $2.5M and 20% bonus. The bonus tokens will be locked for 3 months. The public sale round will have a cap of $2.5M then and will be conducted in Q3/Q4 2018.


The core team consists of 3 people. All of them have a strong background in tech-entrepreneurship. All of them have Computer Science degrees from Cornell, Stanford, and Purdue University. All 3 co-founders previously launched Spin - US-based bike sharing service which operates in 18 cities in the U.S. with 30k vehicles that have serviced over 1 million rides. They have also worked at Microsoft, HP, Lyft previously. Euwyn Poon previously co-founded Delta Financial - interest-bearing Bitcoin account, backed by Y Combinator (W15), Initialized Captial, Winklevoss Capital; Opzi - Enterprise social networking startup funded by top-tier Silicon Valley investors including Y Combinator (S10), SV Angel, First Round Capital. The team already has strong advisors and partnerships, including Dmitri Grishin, Co-founders of Origin Protocol, INK Protocol, Insights Network, Quantstamp. However, now it is unclear how many people work on Layer Protocol development.

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