Sep 2, 2021

11 min read

Beyond Payments: COTI’s Growth Plan to Become a Next-Gen Financial Ecosystem

TLDR:

COTI’s growth plan is to bind everything that we do and new things that we are planning to do into one coherent system and evolve our offering from payments to a fully-encompassing next-generation financial system. This future ecosystem includes the following components:
COTI’s Treasury — The COTI Treasury sits in the epicenter of COTI’s vast ecosystem, collecting fees from COTI’s various activities and distributing them to users who deposit their $COTI into it.
COTI users — In the center of the system are the COTI users who will deposit $COTI into the Treasury, in a flexible and tailored way for each of them, and earn rewards.
A wide range of clients, using multiple technologies and services — all send $COTI fees to the Treasury. These services and technologies include:
Stable coin factory — which offers clients around the world the possibility to issue their own stable coin on top of the Trustchain. Clients will pay both minting and redemption fees to COTI’s Treasury, as well as network fees.
Enterprise and merchant services — A full integration to their backend system, processing of crypto and fiat, wallets and more under the COTI Pay Business brand. We will introduce COTI’s Stable Coin For Merchants, adding substantial processing fees to Treasury, alongside Network fees and Minting fees.
Treasury services — Including borrowing and lending $COTI and vault services. Any fees, interests or collateral deposited will be added to the Treasury.
Ecosystem and partnerships — Everything that we build and that is not on top of the Trustchain such as CVI, ADA Pay and more. All fees from products built on other networks will all be streamlined to the Treasury.
Trustchain — All network services will pay their fees directly to the Treasury and not to COTI, including the interoperability bridge and COTI-X (COTI’s fiat to crypto solution).
Our upcoming Treasury model combines the best of Defi and COTI’s staking 3.0 program. The Treasury will grow as our core services continue to grow, while introducing new services that will grow the demand for $COTI and will streamline $COTI fees to the Treasury.

Watch Shahaf Bar-Geffen, COTI’s CEO, present our Growth Plan on the way to becoming a next-gen financial ecosystem:

Here is what we plan on accomplishing in the coming months and years:

Please note that this is not a short term plan. It should not be seen as a guarantee of timeline and we will always prefer to deliver a high quality product rather than an incomplete rushed release.

Abstract:

COTI is a financial ecosystem, offering a wide range of financial technologies and use cases for enterprise clients and merchants. COTI holders and stakers enable these use cases and are rewarded accordingly.

Users of all services pay $COTI coins to the Treasury. This benefits the holders of $COTI by increasing the demand for $COTI, as well as the $COTI depositors through the growth of the Treasury, being its ultimate beneficiaries

As the ecosystem grows, in terms of volume and by the number of its offered services, the demand for $COTI and the amount of $COTI in the Treasury increases as well. Hence, the $COTI coin value is directly correlated to the growth of the COTI ecosystem.

Introducing COTI’s Treasury:

In order to better understand how we plan to transform COTI from a payments system into an entire financial ecosystem, it’s important to discuss the creation of the “COTI Treasury”. COTI’s Treasury is a pool of $COTI where users can deposit $COTI and be rewarded for their participation. The pool grows over time as the entire ecosystem pays fees, directly or indirectly, to the Treasury. When a user deposits (stake) $COTI into the Treasury, he is entitled to a share of the Treasury that grows over time as the pool collects more and more fees from the COTI ecosystem.

The idea for COTI’s Treasury came into creation as a result of our staking program combined with DeFi concepts. Our Treasury offers the best of both worlds. Such a system is capital-efficient and flexible, allowing certain benefits for our users. These benefits include:

Complete Flexibility and tailoring for each user

The Treasury is completely flexible and users are free to choose how they want to participate and how they want to be rewarded. Our staking 3.0 program, which will gradually be replaced by the Treasury system, offers a few predefined programs in order to participate. The Treasury, however, is built in a way that allows a user to tailor his own program according to his own personal preference. Using the Treasury, users will be able to set their staking level, staking period and even influence on how the algorithm manages their leverage and risk level — all of which will determine the user’s specific reward and APY as per the composition of the Treasury.

Democratization — Staking for everyone

Due to this capital efficient flexible structure and overall growth, the Treasury will be able to dramatically increase the staking pool by accommodating the participation of many more users.

Regulation ready

The only way to deposit into the Treasury is through a VIPER wallet. This is important to note, as we’ve been collecting “know your customer” (or KYC) papers from our users since day one. Regulations are now becoming a requirement in crypto, but we’ve been ahead of the curve. This has given us a major head start, as the COTI Treasury is already regulation ready.

Governing the Treasury

As we expect the value locked in the Treasury to be substantial, we believe that the participants should govern it in a decentralized manner. Accordingly, we’ll be introducing a governance structure and a governance token that will be distributed to those who participate in the Treasury and replenish it.

How does the Treasury grow? Introducing the full COTI ecosystem

As presented above, a wide range of clients, using multiple technologies and services — all send $COTI fees to the Treasury.

Let’s dive into the main categories of technologies and services:

Stable Coin Factory

Since the inception of COTI, we’ve considered stable coins to be a killer app that will facilitate the adoption of cryptocurrency globally. Afterall, stable coins can service payments and central bank digital currencies, or CBDCs. Moreover, we are already seeing bigger organizations getting ready to launch their own stable coins, like what Facebook is doing with Diem. We have also been in touch with a number of enterprises interested in the stable coin space.

COTI is uniquely positioned to take part in this future as the Trustchain is built from the ground up to support payments. It is high scale, low cost, regulation ready and equipped with the right licenses. We plan on making it possible for our clients around the world to issue their own stable coin on top of the Trustchain.

We have been making progress with some major clients and partners and we’ll be gradually announcing new partnerships and deals.

Clients range from enterprises to other key infrastructure players, wishing to partner with COTI. Given the size of these potential clients and their grand user base, we believe that a significant amount of fees will be accumulated in COTI’s Treasury, benefiting depositors and holders.

Using our Stable Coin Factory, we’ll introduce COTI’s Stable Coin For Merchants. Due to some issues with USDT, to some limitations of the USDC and to the high gas costs, our merchants are looking for a stable coin that is fast, cheap to manage and tailored to their needs. COTI’s stable coin, which will be built to support merchants rather than exchanges — will be just that.

Minting of COTI’s stable coin, processing fees and network fees will all be paid to COTI’s Treasury.

So, how does the stable coin factory tie into our Treasury? First and foremost, everything built on the Trustchain will be pushed into the Treasury. Enterprise clients and merchants who will take our offering, will pay both minting and redemption fees to COTI’s Treasury. Any mint and burn fees will be converted to $COTI and then sent to our Treasury. Furthermore, clients or end users who will use the Trustchain will pay network fees to the Treasury.

Other than COTI’s Stable Coin For Merchants, expect some prompt news about COTI participating in the issuance of a major Stable Coin, stay tuned for that during the coming weeks.

Enterprise and Merchant Services

In the last few years we have been very focused on growing our merchants base and are on the path to process enormous volumes this year. Our offering to merchants includes a full integration to their backend system, processing of crypto and fiat, wallets and more.

We have been operating a wide range of products: Blockchain Dollars, Ultra eWallet, and MyFirstWallet just to name a few. All of these products and brands will be built under one brand and product suite simply called COTI Pay Business.

We’ll continue to grow our merchant base and processing volume and will streamline fees to the Treasury that will grow as we continue to scale up.

Our offering of COTI Stable Coin For Merchants solves many of the problems merchants have with cryptocurrencies. We can foresee that it will be adopted by many, adding substantial processing fees to the Treasury, alongside Network fees and Minting fees.

This ties into our Treasury as the processing fees, burn and mint fees will also go into the Treasury accordingly. Network fees and Full node fees from Trustchain will also be allocated to the Treasury.

Treasury Services

As the Treasury will hold a massive amount of $COTI, COTI and its community will be proposing to allocate some of this $COTI to offer important services to our user base, to name a few:

Borrowing and Lending $COTI:

Any major token ecosystem should allow its users (merchants, stakers and others) to borrow and lend its tokens. We are building an independent ability to allow users to borrow and lend COTI. When the Treasury is big enough, some of it will be made available for users to borrow. Dynamics like rates and collateral will be determined by the Treasury algorithm and those who govern the Treasury. Any fees, interests or collateral deposited will be added to the Treasury.

Crypto friendly Bank Account and Debit Card:

Having a COTI bank account means having a real crypto-friendly bank account while being able to enjoy the advantages of a European bank account, including an IBAN. We are about to launch COTI’s bank accounts and debit cards. The first test cards have arrived and COTI users will soon be able to purchase online and in-store, using their COTI Pay debit cards. In the coming months, we will integrate the COTI bank accounts directly into the COTI Pay VIPER wallets, and we will be adding more features such as VIP cards and plans.

Vault:

When managing assets, diversification is key. The Treasury could be actively diversified, at a rate and policies that will be determined by those who govern it. The proceeds of such diversification will be naturally part of the Treasury and will contribute to its growth.

Ecosystem and Partnerships

It’s clear that we’ve been actively growing our ecosystem, but our priority is to use Trustchain, as it’s a great layer 1 protocol for many use cases. However, interoperability is key here. Ethereum essentially governs DeFi, so we may want to build on other chains moving forward. In turn, we need a way to expand COTI’s Treasury when building on other chains.

We are determined to streamline rewards to our Treasury for projects outside of Trustchain. For example, fees generated by CVI can be streamlined towards the Treasury — $GOVI tokens converted to $COTI. More importantly though, everything built on Cardano, like ADA Pay, will also be converted to $COTI and then placed in the Treasury (ADA will be converted to $COTI). Fiat fees coming in from banking solutions such as our upcoming release with Simplex of Bank Accounts and VISA Debit card will also go into the Treasury. In turn, users will always be compensated, even when we develop outside of the Trustchain.

We will be building a cross-chain fee mechanism so that fees from products built on other networks, like ADA Pay, CVI and more, will all be streamlined to the Treasury.

Being able to work where liquidity, or a dominating technology is, while knowing we benefit our core Treasury, allows us a lot of freedom to leverage opportunities and grow our ecosystem.

Trustchain and Network Backbone

All of the services and use cases that have been presented so far, and those yet to be presented in the future, require a robust network. The upcoming release of Mainnet 2.0 will grow our scale, but we don’t plan on stopping there.

What happens after Mainnet 2.0?

Our R&D team continues to develop and explore ways in which the next leap of COTI’s trustchain will include new ways to use capabilities that are unique to our network, like Trust score, to decentralize the Treasury and improved MultiDAG to support the predicted growth of Stable Coins and Enterprise Tokens. Interoperability features and building blocks, such as EVM compatibility and Smart Chains, will also be introduced to offer our services to an even wider audience.

The Trustchain will generate a lot of fees to the Treasury:
By definition, everything that is built on the Trustchain pays network fees payable in $COTI coins. The Treasury will represent a major part in these products, so these fees will be added to the Treasury.

Even more so, as we’ll launch the Treasury, ALL network services will pay their fees directly to the Treasury. These include the interoperability bridge and COTI-X (COTI’s fiat to crypto solution), which will all pay the Treasury and not COTI.

Summary - how the Treasury grows:

COTI’s ecosystem will grow and thrive in the coming years, creating a lot of value to $COTI holders.

Our upcoming Treasury model combines the best of Defi and COTI’s staking 3.0 program. We expect our Treasury to capture hundreds of millions of USD in value.

The Treasury will grow as our core services continue to grow, while introducing new services that will grow the demand for $COTI and will streamline $COTI fees to the Treasury: