We assign the Cool Cousin project a “Stable” 4 out of 5 star rating.
1) One of the main risks we see is the competitive environment and the failure to accept the product by the global market, without this successful development it will be impossible.
The tourism market and the travel industry are extremely complex and competitive. We understand the problems of unreliable information and false reviews, however, a large number of rating services, like TripAdvisor, are attempting to eliminate the error of “cheating”. For example, it is very rare to find that the rating distribution of restaurants is extremely distorted and does not correspond to reality. Even if there are inaccuracies, there is no need to create a whole new service in order to try to remove them.
People who will build their tourist route or plan a trip, at the moment, would rather turn to the ratings and reviews of successful services, rather than to the local but unfamiliar person. In addition to exclusive and representative information about the area, one might be faced with incompetence and poor service. And since it is filtered by the same rating system as other services, the counterparty problem in many ways remains, just in another way.
2) The second risk is the rejection of the token. With all its usefulness, it will be difficult to obtain widespread distribution of the token at the moment.
It is extremely important for the platform to have a presence almost all over the world. Many travelers will be unhappy to learn that to use the service it is necessary to perform additional actions, or they might just be scared away by the crypto market. If a huge service like AIRBNB can function without a token, why can’t the project? Yes, there is a function of rewards, smart contract-based interaction within the platform and a decentralized model of interaction, but is it so necessary? A user will ask all these questions when deciding whether to use the service or not.
3) Risk of strong price volatility. Any payment instrument suffers from a strong volatility of the price. Given the high correlation with rates of other cryptocurrencies, a daily change of 20%, for example, might mean that a Cousin, who provides a service, may work with less diligence, knowing that they will receive less than expected. The same principle also works in the opposite direction, a traveler might think that they overpaid, and it would leave a negative tinge.
4) Liquidity risks. If there is no market-making mechanism or there are no players on both sides in the market, it may be impossible to buy a token to use the service or sell a token for conversion to Fiat and further withdrawal. It only takes a few situations like this for a strong reputational failure of the project. It is possible that future mechanisms and token reserves will allow managing liquidity, but at the introduction of the payment unit there is always the risk of “dead market” and of the inability of one of the parties to realize the purchase or sale of a token at a “fair” price.
5) Tax risks for service providers. The difficulties in regulating the crypto market still scares off many supporters of the traditional economy. In many developed countries this can be a problem, because freelance and other earnings need to be declared, perhaps it will be an obstacle for Cousins in the countries with developed economies.
6) Risk of delay in the product realization. We do not doubt the competence of the team in many areas, including marketing, tourism, and programming. However, blockchain-solutions can be more complicated than believed in the beginning of a product implementation/modernization. In the current phase of the overheating of the crypto market, we see a shortage of experts in blockchain programming, and the ability of the team to solve all the tasks inhouse is very important. With delays in the implementation of points in the roadmap, we can say that the team has set themselves too complex tasks that require either more effort from the team, or more people for the implementation of the product.
7) Risk of abrupt drop of the token price. The constant competition between guides, the drop of Bitcoin and Ethereum, and strong sales by holders, makes these possible factors which could cause the drop of the price of the token. In case of a long-term phase of decline, the token can stop being interesting to the members of the platform as it will not show itself as a reliable payment instrument which can be stored in a wallet for at least several days and only be used for making payment transactions with Cousins.
