What Was Birake (BIR)?
Birake was a digital currency exchange platform launched in mid-March of 2018. It called itself the first "white label" service of this type. Birake also had its own blockchain, powered by the proof-of-stake Birake Coin (BIR).
Cryptocurrency fans interested in running a decentralized exchange could purchase and download the software and create an exchange. The service was rented monthly using Bitcoin—the owner set the fees for transactions, and profits were shared by the exchange owner and the Birake founders.
Learn more about Birake, what it hoped to accomplish, and where the project stands.
- Birake described itself as a "white label" crypto exchange. It provided the exchange technology and infrastructure, and clients provided the customers and marketing.
- Birake was based in Romania. Consequently, getting information on the company is difficult, and it falls outside the U.S. regulatory regime.
- The Birake Network had a separate blockchain, powered by the Birake Coin (BIR). Users could stake BIR tokens to earn block rewards.
- The project shows some signs of life, but it is unclear where it stands.
Understanding Birake (BIR)
Unlike other cryptocurrency platforms, Birake's innovation was to "white label" trading technology so that customers could create exchanges with their own unique branding. White labeling is the term for offering a product to another company, which that company can rebrand.
The concept of white labeling was first developed for the retail industry, where manufacturers removed their brand name and logo from a product so that a distributor could rebrand it. If you've ever purchased a "store brand" item, you've experienced white labeling. Birake believed that the concept can be applied to cryptocurrency exchanges as well.
According to Birake's website, through its service, "...everyone can rent and own their exchange platform. As all the exchanges using [Birake] will share their orders, your exchange will have plenty of active buy/sell orders from day [one]."
In principle, this meant that ICO communities, cryptocurrency and token supporters, and others in the industry could create trading platforms quickly and easily.
Central to Birake's vision was the idea that the concentration of power among a few well-known exchanges went against the principles of decentralization. For this reason, the developers of Birake "...believe that everyone should be able to create their own exchange with just a few clicks and that the orders should be openly shared across all exchanges in the market."
Birake had its origins in 2010 as a software company with activity primarily in South America. According to the website for the exchange, Birake had "deployed automated trading systems, exchange platforms," and products in the "encryption area."
During their time working in the industry, Birake developers encountered many cryptocurrency trading platforms that were overloaded or otherwise inoperable for extended periods. Frustrated, they began working on the concept behind the Birake platform.
Following their initial coin offering and distribution, Birake developed exchange software compatible with 59 cryptocurrencies through 2019. The first alpha version of the Birake exchange launched in October. A beta version was launched in late 2018, and by January 2019, users were able to create personal exchanges. The white-label exchange was launched the same year.
The Birake whitepaper lists the concepts the developers hoped to achieve, and how money would be made from the exchange service. Before creating your exchange, however, you were required to purchase a master node for .3 BTC, which in March 2018 was about $1,200. From April 23, 2022, to June 11, 2022, the median BTC price was $30,432—it would have cost about $9,100 to buy a master node. At Bitcoin's all-time high of $68,991, a master node would have cost around $21,000.
Purchasing a master node to create an exchange to make money from cryptocurrency trading is a significant personal investment. It may also require licensing and approval by regulatory authorities. In the U.S. and many other developed countries, exchanges are regulated, which creates obstacles for anyone interested in running an exchange.
Birake's whitepaper focuses on its business model, financial potential, and strategies rather than the information you'd normally find in a whitepaper—this means the project was an initial coin offering (ICO) whose whitepaper is a pitchbook for raising funds.
The costs to create an exchange, along with incomplete development and lack of a working product at launch likely contributed to reduced interest from investors and the cryptocurrency community. Additionally, the ICO was launched at a time when many others were introduced and other cryptocurrencies like Bitcoin and Ethereum were the focus of investor attention.
Goals of Birake
Birake's developers wanted to create what they believed were truly decentralized exchanges. The intent of the project was to allow anyone to own and maintain a cryptocurrency exchange. Their vision was to "...allow ICO communities, cryptocoins communities and people from this industry to create their own trading platform with a few clicks."
Birake's mission statement was "...to provide both website owners and users of BIRAKE exchanges network, the biggest database of orders / users and achieve the biggest trading volume from cryptocurrency area."
To achieve these goals, the Birake team of 15 people needed funding, so they put together an ICO to get the project started. It is unclear how well the ICO went or what happened to the project other than it failed to gain momentum. In October 2019, Birake stated they had 1,000 active master nodes operating and that they had increased their team to 25 members; In December 2021, the team announced a trading bonus.
What Is Birake Exchange?
Birake is a cryptocurrency exchange platform offered as an ICO. The intent was to raise funds to continue developing and selling white label cryptocurrency exchange software.
What Is Birake Coin?
Birake has a native token, BirakeCoin (BIR). It is used on the exchange platform's blockchain in staking, the validation process.
What Is a Birake Master Node?
Birake's whitepaper does not discuss how its blockchain works. The blockchain was originally forked from Etherum but claimed to use the proof-of-stake mechanisms. At the time the fork was created, Ethereum used proof-of-work. The tasks a master node completes on the Birake blockchain are unclear.
The Bottom Line
Birake is one of many cryptocurrency projects which launched during the ICO boom of 2018. The project offered white-label exchange technology, allowing clients to easily create trading platforms with their own unique branding.
While there are periodic announcements from the team, it is unclear where the project stands and whether it is a project investors should look into.
Investing in cryptocurrencies and Initial Coin Offerings ("ICOs") is highly risky and speculative, and this article is not a recommendation by Investopedia or the writer to invest in cryptocurrencies or ICOs. Since each individual's situation is unique, a qualified professional should always be consulted before making any financial decisions. Investopedia makes no representations or warranties as to the accuracy or timeliness of the information contained herein.