Anyone else would have gone to jail. Perpetrators created 3 million fake bank accounts and 500,000 fake credit card accounts. More than 5,300 people were complicit.
But it wasn’t some shady, payday-lending scheme. It wasn’t even a Nigerian boiler-room operation.
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Instead, it was a well-coordinated plan to commit massive consumer fraud. And the perpetrator was America’s fourth-largest bank: Wells Fargo.
In 2016, the U.S. Consumer Financial Protection Bureau (CFPB) accused the bank of secretly creating millions of unauthorized bank and credit card accounts — without its customers knowing — since 2011.
Additionally, regulators said Wells Fargo employees submitted applications for 565,443 credit card accounts without customers’ knowledge or consent. Roughly 14,000 of those accounts incurred over $400,000 in fees.
The CFPB slapped the bank with $185 million in fines — and ordered it to refund $5 million to customers. Although it was the agency’s largest fine at the time, it’s merely a slap on the wrist for a $207.9 billion market cap company like Wells Fargo.
But if you think Wells Fargo’s case is an isolated incident, think again. Corporate fraud is more rampant than you think.
According to a research paper published by the University of Toronto, one in eight large, publicly traded U.S. firms engage in fraud.
Look, you and I don’t need tenured professors to tell us corporate fraud is everywhere. For the last 20 years, the headlines have been full of corporate malfeasance.
We’ve seen name-brand companies caught cooking the books (like Enron and WorldCom). And we’ve seen venerable Wall Street firms, banks, and insurance companies collapse after lying about the state of their balance sheets (like Bear Stearns, Lehman Brothers, AIG, Countrywide, and Wachovia).
But tougher regulations have done little to stem the tide of widespread, organized corporate fraud. That’s because a great deal of the fraud involves document tampering like what Wells Fargo did.
Think about this… Your ownership of your car, home, boat, and even stocks depends on documents resting in a warehouse or computer hard drive.
What’s to stop someone from changing your documents for their benefit?
The truth is, the illicit profits coming from tampering with documents are just too big a temptation.
In fact, despite the top five U.S. mortgage companies being fined $25 billion, we’re still seeing rampant global document tampering among banks.
- U.K. bank RBS was accused of tampering with documents and transcripts to push its small business customers into bankruptcy — then scoop up their assets at rock-bottom prices. It even handed out bonuses to staff for identifying struggling firms.
- Regional Japanese bank Suruga was accused of falsifying documents to issue loans with payments twice the borrowers’ monthly salaries.
- Canadian bank CIBC was accused of tampering documents, too. A former CIBC representative said 85% of the sales staff in her workplace forged documents, and the manager encouraged them to do so.
And it’s not just banks that are ripping off the public…
On February 8, 2017, news broke that document fraud had reached as high an office as Japan’s prime minister. But it wasn’t until March 2018 that the Finance Ministry admitted to altering documents to push through a sweetheart land deal at a fraction of its true worth.
And last April, global industrial giant Kobe Steel came under fire for data tampering. The company admitted to falsifying the specifications of its steel to more than 600 customers — for the last 50 years.
Considering Kobe provides steel for trains, planes, and cars around the world, you can get an idea of just how serious this type of fraud is.
As you can see, document tampering is everywhere. The financial incentive to forge a signature, check a box, or change the purity rating on a commodity is just too lucrative…
Researchers estimate that corporate fraud in the U.S. from 1996 to 2004 destroyed between $180 billion and $360 billion per year.
Clearly, current document security measures are inadequate. If they weren’t, this wouldn’t be such a huge problem. That’s why a new form of security is needed.
Easy, Cheap Document Security
The number of documents we use each year is massive.
Just to give you some context, U.S. office workers alone produce an estimated 50 trillion pages of documents each year. Many of them are converted to digital copies, making them highly susceptible to cyber tampering.
So the key problem to solve is: How do you easily secure all that data for a minimal cost?
You see, the cost to secure a document can’t outstrip its value. Think about it this way: Would you employ an army of thousands to protect a child’s piggy bank?
Obviously not. The cost of protection is far more than the value of the piggy bank.
I’ve found a project that’s figured out how to secure the world’s digital documents for just fractions of a penny. And customers can use its solution without any programming knowledge.
Unlike current solutions that require climbing a steep learning curve, anyone can use it. With the click of a mouse, you can instantly secure a document.
This ease of use is one of the reasons it was able to sign a deal with one of the world’s biggest tech firms.
The deal will deliver its document-protecting tools to 8,500 companies. Last year, these companies generated almost a half-trillion dollars in revenue. And we estimate they’ll process 15.2 billion pages of documents each year.
The market has failed to grasp just how big a deal this is. That gives us a massive advantage. This partnership could make this project the leading provider of document security. And it would take this token up 850% this year… and 3,987% over the next three to five years.
Data Anchoring to the Blockchain
The project set to take document security mainstream is Tierion (TNT).
Wayne Vaughan and Jason Bukowski started Tierion in 2015.
Wayne brings over 20 years of digital marketing experience to the table. He created one of the first software as a service (SaaS) marketing automation platforms — and founded a digital agency.
During his time as a digital marketer, he recognized the need to verify the integrity of marketing analytics data. So he teamed up with Jason — an experienced software developer — to build a solution: linking data to the bitcoin blockchain to create an immutable timestamp proof.
They took their idea to the Consensus 2015 Makeathon, a contest for the best blockchain products. Wayne led a team of four in developing an application to produce verifiable, immutable receipts for insurance claim processes.
It won first place. And this victory propelled the project forward…
In August 2015, they launched Tierion as a SaaS application. It anchored data to the bitcoin blockchain and created an audit trail for business processes.
Tierion raised its first round of funding in April 2016. Prominent blockchain venture capital firms Blockchain Capital, Fenbushi Capital, and Digital Currency Group led the $1 million raise.
Digital Currency Group CEO Barry Silbert said at the time, “We are excited to see the Tierion team leveraging the core innovation of blockchain technology to secure data and ensure it cannot be tampered with.”
Moving forward, the team realized its solution was limited by bitcoin’s throughput. That would make its service too expensive. And so, the idea for Chainpoint was born.
Chainpoint is a network of nodes linking data to the bitcoin blockchain. This node architecture anchors data in a scalable, low-cost manner.
In other words, Chainpoint is a standard for recording and verifying data on the blockchain without relying on a trusted third party.
[ Data anchoring is the process of creating timestamped data proofs using blockchain technologies. Chainpoint, for example, creates a hash of a document in a bitcoin transaction. Hashes enable computers to easily compare complex data to determine if they’re identical. Further, the hash produces a timestamp, a digital record of the event. ]
Over 2017, Tierion released its white paper… raised $25 million in a token sale… and launched the Tierion Network with its flagship product, Chainpoint.
Today, Chainpoint has over 5,700 nodes and thousands of customers — and can process millions of document proofs per day.
Now, Wayne is also one of Factom’s founders. Longtime crypto-readers know that Factom uses the blockchain to secure documents and Internet of Things devices.
I still like Factom and keeping an eye on it. But it would be foolish to ignore the strides Tierion has made in this business. It’s figured out a way to do everything Factom can do — but faster, cheaper, and easier.
And just like how many investors own both Lowe’s and Home Depot, I think the space is big enough to support both Factom and Tierion.
How Tierion Works
To understand how Tierion works, I’ll have to get a little technical, so bear with me…
Tierion’s Chainpoint system takes a document and converts the data in it to a string of numbers.
A mathematical formula (algorithm) creates these numbers, called a “hash.” Each hash can be used to uniquely identify each document. If even a comma is changed on the original document, the algorithm will spit out a different hash, and the fraud will be exposed.
So keeping these unique identifiers safe is paramount. Remember, these numbers will show whether the original document was tampered with.
You can’t store these numbers on a centralized database… It’d be too easy for someone to change them. Instead, Tierion writes these numbers into the bitcoin and Ethereum blockchains. (To date, neither blockchain has ever been hacked.)
Writing the data into these blockchains creates an eternal, unhackable record of the original document.
Any attempt to tamper with the document would be immediately noticed. And unless you’re willing to spend billions of dollars to try attacking the bitcoin or Ethereum networks, there’s no way to document tamper without getting caught.
Given the scope of annual corporate fraud (as much as $360 billion a year), we see a future where regulators and accounting bodies will compel all public businesses to use some form of anti-tampering tech to secure their documents.
The size of this opportunity is vast. As I’ll show you, Tierion has the broadest corporate footprint of any player in the space. I believe global corporations will migrate to its low-cost, easy solution for 100% tamper-proofing their entire document chains.
Adoption and Innovation
The two key factors to look for in an early-stage technology are the pace of innovation and the pace of adoption. That’s how you’ll find a project’s real value — not how it’s priced.
If you’re on track with those two factors, then it’s just a matter of waiting for market sentiment to catch up.
What makes Tierion special is it’s already innovating. It’s figured out a way to make document security easy and cheap. For many users, the cost will be near zero (more on that in a moment).
And what separates it from its competitors is its incredible piercing of corporate America.
Tierion has quietly amassed the biggest footprint among global corporate users of any of its competitors.
A deal with Dell has put the Chainpoint system on Dell’s Boomi enterprise software platform. This has put Chainpoint in the hands of Dell’s 115,000 users. And 8,500 enterprise clients, such as American Express, Novartis, and Dropbox, are already using it.
Through Boomi, an enterprise client could take the data it’s stored on Dropbox and register it on the blockchain with Chainpoint.
That’s Boomi’s real benefit: It easily and securely connects software applications for businesses. The addition of Chainpoint now makes document security just a mouse click away for America’s largest companies.
It’s not just Dell using Tierion, either… On January 30, 2017, Microsoft announced it’d also be working with Tierion.
The two companies have been working on securing digital identity and documents on the blockchain. And this year, Microsoft incorporated Chainpoint into its Flow and Azure Logic Apps.
Microsoft Flow is like Dell’s Boomi. So Flow customers can use Chainpoint with popular applications such as Salesforce, Office 365, Twitter, Dropbox, and Google’s services.
And Tierion is also working on a plug-in for Hyperledger, the open-source blockchain supported by IBM, Linux, Intel, and others.
Now, Tierion’s Chainpoint has three unique characteristics…
- The first is its decentralized architecture. Nodes collect proofs from clients and send them to Core Members. Core Members then anchor these proofs to the blockchain.
- The second characteristic is its proof structure. You see, Chainpoint doesn’t just secure a proof to the bitcoin blockchain…
- And the third characteristic is something we’ve mentioned throughout this issue: Chainpoint can easily integrate with existing software applications.
What’s It Worth?
In the last crypto bull market, the whole market traded together. In other words, the bull market took all projects — good or bad — higher.
But this time around, the market will be more discerning. And we think high-quality projects will outperform — especially with institutional money coming into the space.
And Tierion is one of these projects.
With a market cap of roughly $14 million (at the time of this writing), you won’t find Tierion anywhere near the CoinMarketCap Top 100.
But that’s our opportunity…
Tierion is a $14 million project in an information security market worth $124 billion. (That’s per Gartner, a leading technology research firm.)
So the market is valuing Tierion at just one basis point of the entire market — or 0.01%.
Simply put, the market is overlooking Tierion.
Tierion’s Chainpoint has been integrated into Dell’s Boomi and Microsoft’s Flow… and will soon be in Hyperledger as well.
Current clients include Philips, Xero, Ultimus, EVRYTHNG, and Liaison.
And it has notable investors like Blockchain Capital, Fenbushi Capital, and the Digital Currency Group.
Right now, we think Tierion is worth 10 basis points of the information security market, or $124 million.
That would give TNT a price of $0.29, an 850% gain from today.
But we really like the project’s long-term prospects. You see, TNT is designed to incentivize the ecosystem and accrue value…
Clients pay nodes in TNT for proofs. The nodes then pay Core Members in TNT to anchor these proofs. And Core Members use those fees to pay for expenses.
Plus, Tierion has smartly designed Chainpoint so end users don’t need to buy TNT. A node can charge in other cryptocurrencies or fiat currencies and still convert TNT behind the scenes.
Further, nodes can also build independent services and charge prices independent of TNT’s value. That gives them opportunities in addition to proofs.
The key, however, is that each node must stake 5,000 TNT to be part of the ecosystem. So as long as a node is running, it must hold 5,000 TNT that it cannot spend. It’s essentially locked up.
It’s a smart way for nodes to be vested in the Tierion network.
Further, Chainpoint scales by adding nodes to the network. As the network grows, more nodes will join the network. So the supply of locked-up TNT will increase, too.
Three to five years from now, we can see Tierion taking 1% of the information security market. That would give it a valuation of $1.2 billion.
Fully diluted, that gives us a TNT price of $1.24, or a 3,987% gain from today.
Bringing It All Together
It’s very rare to find a crypto idea with this type of traction at a sub-$100 million market cap. As Tierion gains more widespread adoption, I believe the gains from these levels will be enormous.
Tierion has deliberately not engaged in widespread promotion. That conservatism has helped deliver one of the best deals I’ve found in all of crypto.
People will look back at Tierion’s market cap of just $14 million and gasp at how cheap this project was.
If you do not yet own Tierion, now is the time to pull the trigger and get this future giant into your crypto portfolio.
Binance: Offers mobile app and probably the fastest growing exchange. If you need to pick only one, this is the best and #1 in 2019.
Kucoin: One of the strongest exchange that also offers a mobile app (Android and iOS). They have been constantly updating their mobile app to make it one of the best in the industry.
Huobi: Huobi is a digital currency exchange that allows its users to trade more than 244 cryptocurrency pairs. They also have mobile apps for both Android and iOS.
Gate.io: One of the best exchange for low cap coins. They also have mobile apps for both Android and iOS.
Bittrex: Another high-quality exchange with a lot of coins. Bittrex is a US-based cryptocurrency exchange that provides you the option to trade more than 190 cryptocurrencies at a time.
Thanks for reading! Feel free to check out some of my similar Cryptocurrency related post below.
- How to Earn Crypto Income From Komodo (KMD)
- “Lock” Your BIX Tokens Today to Continue Receiving Your BIX Incentive Reward
- How to Earn ONG From Ontology (ONT)
- Zilliqa : Progress and Update, June 2019
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Tierion (TNT): Securing the World’s Digital Documents for just fractions of a penny. was originally published in Data Driven Investor on Medium, where people are continuing the conversation by highlighting and responding to this story.