COTI Overview Document

Overview Document
V2
Contents
Executive Summary 3
1. Context 5
2. Objectives 8
3. COTI Ecosystem 12
3.1 Introduction to the Cluster 12
3.2 Trust Scoring Mechanism 14
3.3 Mediation System 16
3.4 Native Currency 19
3.5 Currency Exchange 20
3.6 Decentralised Governance 22
4. Applications & Services 23
4.1 For Consumers 23
4.2 For Merchants 25
4.3 For Mediators 27
4..4 For External Projects 27
5. Regulatory Approach 28
6. Team 30
7. Roadmap 33
8. Risk Factors & Legal Disclaimers 37

Executive Summary
COTI’s vision is to build a decentralised and scalable payments network to facilitate efficient global
commerce. This will set the standard for a next generation payment solution that is trust-driven, instant,
cost-effective and supportive of a multi-currency wallet. By reconciling cutting edge distributed ledger
technologies with the best of traditional payment solutions, COTI will be poised to spearhead the mass
adoption of digital currencies in the mobile era.
1. CONTEXT
2. OBJECTIVES To elucidate the scope of this solution, it is relevant to note that the online payment fees and more, which are imposed on both the consumer and
3. COTI ECOSYSTEM payments industry encompasses over 1.6 billion people worldwide . 1
the merchant.
Transactional volumes exceeded two trillion dollars in 2016 and are
4. APPLICATIONS & SERVICES
projected to double by 2020, while e-commerce has been amplified by • Long settlement periods with high rolling reserves3. A payment can take
5. REGULATORY APPROACH increasing mobile payments. According to recent research , the volume
2
up to two weeks to settle and for the merchant to be paid, particularly
of US in-store mobile payments is expected to grow at an annual CAGR as it concerns high-risk transactions designated by credit card
6. TEAM
of 80% between 2015 and 2020. Transaction volume is forecast to reach networks. In such instances, provisions are withheld from merchants,
7. ROADMAP $500 billion by 2020, and user growth is expected to increase concurrently, potentially causing severe liquidity issues and driving up the prices of
exceeding 150 million mobile users in the same year. goods and services.
8. RISK FACTORS
At present, decentralised online payment systems lack the ability to scale in • Absence of a shared trust mechanism. Currently, credit scores and
volume and speed, and the effect is most apparent with cryptocurrencies. ratings are marketplace-specific and non-transferable across platforms.
Although several blockchain technologies have tried to achieve a high Consumers and merchants who have worked hard to obtain high ratings
throughput of transactions per second (TPS), it has remained an elusive goal cannot migrate seamlessly to another marketplace without ceding their
due to scalability challenges. accumulated trust ratings.
What’s more, current online and mobile payment solutions have recently • Lack of multi-currency support. While credit cards support fiat
been dealing with inadequacies that have constrained market growth while money, users have no control over currency exchange rates. What’s
downgrading user and merchant satisfaction: more, digital currencies have not yet been integrated into credit card
networks.
• High processing fees. Credit card networks charge a number of fees
including annual fees, late fees, balance transfer fees, expedited
1
https://www.statista.com/topics/871/online-shopping/
2
http://www.businessinsider.com/the-mobile-payments-report
3
COTI Overview Document 3
Provision for chargebacks
To this end, COTI is developing a variety of technologies that will work seamless connectivity to the COTI network. For consumers, the COTI
in concert to provide consumers and merchants with a vastly improved wallet and debit card will facilitate the secure storage, transmission,
payment experience utilising a globally decentralised digital currency, and exchange of digital and fiat currencies. For merchants, COTI's
Currency Of The Internet (COTI), and a comprehensive payment ecosystem processing solutions will facilitate the acceptance of payments in
characterised by a number of key features: a variety of fiat and digital currencies while substantially lower
processing fees. For mediators, the dedicated client will enable
—— Instantaneous remittance that utilises distributed ledger technology mediators to contribute to, and be compensated for, the successful
in the form of a DAG (directed acyclic graph) structure. resolution of transaction disputes.
—— A global Trust Scoring Engine, which automatically assesses the COTI is currently laying down the licencing foundations that will enable
interactions between buyers and sellers over time, assigning each it to comply with existing regulations, both as a payments network and
1. CONTEXT
network participant a unique Trust Score. Trust Scores provide a a currency exchange. With respect to COTI – and the handling of digital
2. OBJECTIVES numerical representation of the relative value that each participant currencies more generally – the COTI team welcomes greater regulatory
contributes to the COTI network and are used to assign network clarity and believes digital currency-specific frameworks will serve as a
3. COTI ECOSYSTEM
fees. It also facilitates the decision-making process by users and catalyst for the mainstream adoption of digital currencies. To this effect,
4. APPLICATIONS & SERVICES merchants and removes the dependence on a single centralised COTI is in the process of applying for a distributed ledger technology (DLT)
marketplace for ratings. licence in Gibraltar and has initiated dialogues with regulators globally to
5. REGULATORY APPROACH
help shape its legal framework. In the interim, COTI is adopting banking
6. TEAM industry compliance standards to ensure that its digital currency-related
—— A Mediation System that resolves disputes between transacting
7. ROADMAP parties and maintains the integrity of the network. A first of activities do not serve as a conduit for money laundering or other illicit
its kind, the system leverages data science, game theory and activity.
8. RISK FACTORS
an independent network of crowdsourced mediators to resolve
disputes fairly and efficiently — without prompting a substantial The COTI team includes veterans of the payment, cryptography, asset
increase in transaction costs. management and banking industries. These experts possess experience in
worldwide payment solutions ranging from Processing.com and Markets.
—— Currency exchange integration that provides network participants com to Investec Bank, BlackRock and HSBC. The team has set ambitious
with a means of moving seamlessly between currencies — both fiat development targets and is on track to launch the first phase of the COTI
and digital — by aggregating liquidity from internal and external network in the fourth quarter of 2018. Thereafter, COTI will build upon
liquidity pools. The exchange is complemented by an automated its robust technical foundations and forge its way to streamline online
market-maker, which maintains fair and orderly markets in a range payments. Ultimately, COTI will enable higher global trade volumes by
of currencies. enabling the free flow of value in the same way that the Internet enables
the free flow of information.
—— COTI is developing a suite of applications and services that will
provide consumers, merchants and crowdsourced mediators with

1. Context
Worldwide consumer payment transactions exceed $50 trillion annually and are increasingly carried out
using electronic payment methods. Yet despite the intense competition within the payments industry,
consumers and merchants face high fees and low approval rates. Digital currencies could represent a
compelling alternative, but are not practical to use in common payment contexts in their current form.
1. CONTEXT
• Cross-border e-commerce. Cross-border B2C e-commerce is expected that lack the capital or appetite to manage the operational burden
2. OBJECTIVES
to reach one trillion dollars in annual transaction volume by 20204, of internalising these key functions are unable to offer payment
3. COTI ECOSYSTEM the clear majority of which will be performed using card-based capabilities to their marketplace participants.
solutions. However, as a consequence of the four-party model
(consumers, retailers, issuers and acquirers) adhered to by major • Peer-to-peer commerce. Numerous non-bank service providers offer
5. REGULATORY APPROACH card networks, transactions involving card issuers and card acquirers solutions for peer-to-peer (P2P) transactions. These services handle
6. TEAM located in different regions are inherently less reliable than equivalent the money transfer aspect of P2P transactions effectively, but their
domestic transactions. Cross-border card payments are encumbered use is confined primarily to transactions that involve trusted parties.
7. ROADMAP
by higher fees, higher abandonment rates and lower approval rates These services fail to account for the conformity and delivery of
8. RISK FACTORS relative to domestic transactions. For US-based merchants, cross- goods or services. Rather, they focus solely on the authorisation,
border transactions are 2-3 times more likely to be declined relative clearing and settlement of money transfers. As such, they are not
to domestic transactions5, and some 31% of declined transactions turn complete payment solutions and are not suited to accommodate P2P
out to be false positives . 6
commerce involving parties that do not know each other and may
never transact again. Moreover, these solutions are costly and, in
• Online marketplaces. Online marketplaces connecting buyers and effect, inefficient for micro P2P transactions.
sellers can work with existing payment solutions to an extent.
However, key functions normally handled by the card networks The shortcomings faced by existing payment solutions when handling
(e.g., dispute resolution) must be administered internally by the these new payment scenarios are attributable to one key factor: the lack
marketplace operators. The internalisation of these functions adds of trust. In cross-border e-commerce, the lack of trust between issuers
considerable operational overhead to each marketplace and raises the and acquirers located in different jurisdictions results in high fees and
barriers to entry to would-be competitors. Moreover, marketplaces low approval rates. In online marketplaces, the long-tail distribution
4
Digital Globalization: The New Era of Global Flows, McKisnsey Global Institute, March 2016
5
https://www.ethoca.com/node/125 COTI Overview Document 5
6
True Cost of Fraud Study, LexisNexis, 2016
of merchants results in the need for marketplaces to internalise costly Some members of the blockchain community have rallied behind the
mediation functions normally administered by the card networks. And in notion that digital currencies will become widely used as currency in
P2P transactions, the lack of trust between parties that do not know one everyday payment scenarios. It has been argued that blockchain-based
another inhibits the growth of P2P commerce. Universally, the lack of currencies like Bitcoin provide a low-friction alternative to the traditional
trust represents a major source of friction, preventing buyers and sellers payment system. They promise greater security, faster settlement times,
everywhere from transacting to their fullest potential. lower transaction fees and relief from the interference of central banks
and intermediaries.
The unfulfilled promise of digital currencies
Without a doubt, blockchain technologies have revolutionised the way we
transact information. However, data structures such as linear approving
methodologies have become irrelevant to suit the needs of highly
1. CONTEXT
scalable payment solutions, creating the need for parallel transaction
2. OBJECTIVES confirmations.
3. COTI ECOSYSTEM Rather than placing their trust in third party

Bitcoin inventor Satoshi Nakamoto released Bitcoin: A Peer-To-Peer
4. APPLICATIONS & SERVICES Electronic Cash System in late 20087. In the paper, Nakamoto was critical intermediaries, users of these transaction networks
of the trust-based model upon which existing electronic payment systems
5. REGULATORY APPROACH put their trust in cryptographic protocols and the
relied, pointing out that the trust-based model requires a costly mediation
6. TEAM
layer that causes merchants to be wary of their customers. Nakamoto’s plurality of network participants.
7. ROADMAP solution was to propose a new electronic payment system, Bitcoin, that
would enable two parties to transact directly based on cryptographic
8. RISK FACTORS
proofs alone without the need for trusted third parties.
Blockchain-based payment systems, including Bitcoin and its peers, are

often described as trust-less in acknowledgement of the fact that these In practice, however, the use and adoption of digital currencies in
systems can function without trusted third parties. Transactions in such everyday payment scenarios has been limited due to a variety of factors,
networks are recorded cryptographically on distributed, secure and as detailed below:
irrevocable ledgers, while ledger accuracy and consistency are ensured
through the consensus process. Rather than placing their trust in third • Scalability. As the Bitcoin network has grown, it has faced severe
party intermediaries, users of these transaction networks put their trust in network congestion, giving rise to higher fees and slower settlement
cryptographic protocols and the plurality of network participants. times. The network can currently handle approximately 20
7
Bitcoin: A peer-to-peer electronic cash system, Satoshi Nakamoto, 2008
transactions per second on average, compared to Visa’s 65,000 and spending Bitcoin are too complicated, and new users of the
transactions per second8. currency face a significant learning curve.
• Speed and consistency. Transaction confirmation times on the Bitcoin Perhaps the single biggest impediment to Bitcoin and its peers in
network are not only slow, but fluctuate significantly. Since a Bitcoin becoming widely adopted in day-to-day payments is the fact that they
transaction needs to be confirmed six times to be validated, the solve only part of the payments challenge. While Bitcoin can successfully
process can take between 30 minutes and 16 hours on average. confirm that a payment has been made, it is unable to account for the
conformity and delivery of the goods or services associated with the
• Legality. Bitcoin has been denounced for facilitating illicit transactions payment. The Bitcoin blockchain can only rely on data from within the
and large-scale money laundering and may be called to account by Bitcoin ecosystem, without taking external data into account.
new global regulatory frameworks.
1. CONTEXT In their current form, Bitcoin and its peers can serve as cryptographically-
2. OBJECTIVES • Fungibility. Due to the illegal nature of certain Bitcoin transactions, secure cash layers. However, in order to cross the chasm and become
advanced backtracking technologies can link Bitcoins to a history widely used in day-to-day payments, digital currencies will need to be
3. COTI ECOSYSTEM
of illicit activity, thus downsizing acceptance by legitimate extended to offer the consumer and merchant protections that are now
4. APPLICATIONS & SERVICES counterparties. commonplace in the payments industry. For example, major card networks
allow for the correction of billing errors, the reversal of unauthorised
• Third party vulnerabilities. Although the Bitcoin network itself has charges and the issuance of refunds to purchasers who do not receive
6. TEAM the goods or services that they pay for. Each of these provisions serve
never been compromised, a number of Bitcoin exchanges, which
enable individuals to exchange fiat currency for Bitcoin, have been to instil greater peace of mind in consumers and merchants, driving their
7. ROADMAP
hacked. These hacks have resulted in the loss of hundreds of millions adoption of, or continued participation in, existing payments networks.
8. RISK FACTORS Interestingly, in the Bitcoin whitepaper, Nakamoto foresaw the need for
of dollars’ worth of Bitcoin.
buyer protection mechanisms. Yet, in its current form, the Bitcoin network
• Volatility. Merchants that accept Bitcoin either face a high degree of offers no such mechanisms.
exposure to fluctuating exchange rates, or face additional costs in
order to hedge against these fluctuations. Moreover, the appreciation •••
in Bitcoin’s value has prompted Bitcoin owners to retain their holdings
rather than use them for payments. While digital currencies have the potential to facilitate payments with
greater security and lower transaction fees, a variety of factors inhibit
• Immutability. Although a strength from a security standpoint, the their uptake in payment use cases — chief among which is the fact that
finality and irreversibility of Bitcoin transactions limit the currency’s they function as cash layers rather than as complete payment solutions.
utility in general payment contexts.
• Complexity. For typical consumers, the processes involved in acquiring
8
https://www.visaeurope.com/newsroom/global-news/detail?id=2288776 COTI Overview Document 7
2. Objectives
The COTI network was designed with the goal of developing a next-generation payments network that
could gain widespread adoption by consumers and merchants, serving as a catalyst for the mainstream
acceptance of digital currencies as a payment method.
COTI began by looking at the key factors affecting the pace and extent
1. CONTEXT of payment system adoption and concluded that its next generation
payments network would need to build on top of the foundations of
2. OBJECTIVES
traditional payment systems and digital currencies, incorporating their
3. COTI ECOSYSTEM strengths while finding workarounds for their limitations.

Using the characteristics of traditional payment systems and pioneering
5. REGULATORY APPROACH digital currencies as benchmarks, the team defined the key objectives
6. TEAM that its payments network would need to satisfy. The objectives are
summarised in Exhibit 1: Requirements for a next generation payments
7. ROADMAP
network and are discussed in detail in the pages that follow.
8. RISK FACTORS
Throughout this section, references to digital currencies are to be taken
as references to the major existing blockchain-based cryptocurrencies,
including Bitcoin, which is still the leading cryptocurrency in terms of
market capitalisation.
To develop a distributed ledger-based payment system that provides a

streamlined user experience, while harnessing the power of advanced
financial tools and removing the need for financial intermediaries, we
have set out to achieve the following objectives:

EXHIBIT 1
Requirements for a next generation payments network
Status Quo
Factor COTI’s Objective Further Reading
Card Networks Digital Currencies
Governance • Centralised • Decentralised • Decentralised • 3.6: Decentralised Governance
• ~65,000 TPS* • ~20 TPS • 10,000+ TPS

Scalability • ~15 min. confirmation • Instant confirmation • 3.1: Introduction to the Cluster
• Instant confirmation
1. CONTEXT
2. OBJECTIVES • Low, particularly in cross- • High, irrespective of

Reliability • Low • 3.3: Mediation System
border contexts industry or jurisdiction
3. COTI ECOSYSTEM
• Centralised • Decentralised
4. APPLICATIONS & SERVICES Buyer-seller protections • None • 3.3: Mediation System
• Costly • Efficient
• High-cost • Zero-to-low cost
Transaction costs • Typically low-cost • 3.2: Trust Scoring Mechanism
6. TEAM • Based on broad categories • Based on behaviour
7. ROADMAP
• Trust-based(reliantontrusted • Trust-less (not reliant on
Trust model • Trust-generative • 3.2: Trust Scoring Mechansim
8. RISK FACTORS third parties) trusted third parties)
• Complicated for most • Easy for buyers and

Ease-of-use • Easy for buyers and sellers • 4: Applications & Services
buyers and sellers sellers
• Fully-compliant • Fully-compliant
Compliance • Largely unregulated • 5: Regulatory Approach
• Welcoming of regulation
*+
Transactions-per-second

Objective 1: Decentralisation Objective 4: Security
In order to develop a distributed ledger payment system, a decentralised To develop the next generation payment system, the network should be
governance model will be necessary alongside decentralised transaction safeguarded against errors, fraud and counterparty abuse.
validation. Such a mechanism will directly involve the community in the
development and mass adoption of the network. • Current payment methods. Credit card providers make provisions for
resolving disputes and handling complaints. These dispute resolution
• Current payment methods. Credit card providers are centralised services are costly, which results in higher transaction costs. Digital
entities, and major cryptocurrencies do not offer sustainable currencies, on the other hand, only consider the funds transfer aspect
decentralised governance mechanisms. In the long term, this may of transactions. They do not take the conformity or delivery of goods
monopolise the pool of validators that can impact the trustworthiness and services into consideration.
of the network.
1. CONTEXT
Objective 5: Low-to-zero fees
2. OBJECTIVES Objective 2: Scalability and instantaneity Transaction costs should be kept to a bare minimum and levied in
For a payment system to efficiently accommodate common exchanges, it accordance with each participant’s individual contribution to the network
3. COTI ECOSYSTEM
should be able to provide instant payment solutions despite supporting so as to create a self-sustained and equitable payment system.
4. APPLICATIONS & SERVICES high transaction volumes.
5. REGULATORY APPROACH • Current payment methods. Card networks typically levy various fixed
• Current payment methods. While card providers have instant and percentage-based fees to process a transaction, with additional
6. TEAM
remittance, blockchain-based digital currencies have not been able fees being levied when cross-border and cross-currency transactions
7. ROADMAP to address scalability challenges effectively, which has resulted in are involved. Moreover, merchants operating in high-risk jurisdictions
increased network congestion. and industries are subject to higher transaction fees, regardless
8. RISK FACTORS
of their respective behaviours and risk profiles. Digital currency
Objective 3: Reliability transaction fees vary widely depending on network congestion and
The network should provide a reliable standard for all network activity, can range from a few cents to dozens of dollars per transaction.
including deposits, withdrawals, fees and transaction confirmations.
Objective 6: Trust generative
• Current payment methods. Card network transaction approval rates To provide a community-based decentralised payment system, it will be
vary widely, but are particularly low in cross-border contexts, where necessary to create trust among community members by incentivising
risk-averse fraud detection systems often reject worthy buyers. Digital trustworthy ecosystem participants with lower fees and higher transaction
currencies generally achieve high approval rates due to the lack of confirmations.
intermediaries; however, it has become challenging to assess their
reliability as processing times and fees for many digital currencies • Current payment methods. Card network transactions rely on trusted
fluctuate widely. financial intermediaries to serve as proxies for direct trust between
transacting parties. Digital currencies are trust-less insofar as their

cryptographic protocols provide surety with respect to the transfer of
funds. However, they function merely as a cash layer rather than as a
complete payment solution.
Objective 7: Ease-of-use
The network should be accessible and user-friendly for buyers and
sellers by way of dedicated applications during the onboarding process
and transactional experience. The support of a multicurrency wallet will
further enable network participants to transact using a variety of fiat and
digital currencies.
1. CONTEXT
• Current payment methods. Card networks make the transaction
2. OBJECTIVES process convenient for buyers. For sellers, card acceptance is
relatively straightforward; however, depending on the nature
3. COTI ECOSYSTEM
of the business involved, they may need to undergo lengthy
4. APPLICATIONS & SERVICES onboarding procedures. In their current form, digital currencies are
5. REGULATORY APPROACH too complicated for the vast majority of buyers and sellers. While
card networks support virtually all fiat currencies, they have yet to
6. TEAM
integrate digital currencies. Digital currency networks, on the other
7. ROADMAP hand, tend to only process payments in their native currencies.
8. RISK FACTORS
Objective 8: Regulatory compliance
To develop digital currency-specific regulatory frameworks for widespread To provide a community based decentralised
consumer adoption, it will be necessary to comply with the legal
frameworks of all jurisdictions in which its users reside. payment system, it will be necessary to create
trust among community members by incentivising
• Current payment methods. Card networks interoperate seamlessly
with existing banking and legal systems and make strict provisions trustworthy ecosystem participants with lower fees
for complying with anti-money-laundering (AML) regulations. and higher transaction confirmations.
Digital currencies are pseudo-anonymous, uncensorable and largely
unregulated.

3. The COTI Ecosystem
The COTI ecosystem was designed using innovative distributed ledger technology with the goal of
providing a superior payment solution that outpaces current legacy card networks and cryptocurrency
technologies. The COTI base protocol, native currency, Mediation System and Trust Scoring Engine were
conceptualised to produce a comprehensive payment solution for merchants and consumers that is both
decentralised and scalable.
1. CONTEXT
2. OBJECTIVES
3.1 Introduction to the Cluster
3. COTI ECOSYSTEM The Cluster, COTI’s distributed ledger, is based on a directed acyclic
3.1 Introduction to the Cluster graph (DAG) data structure consisting of transactions that propagate in a
unidirectional pathway. While greater scale in blockchain-based networks
3.2 Trust Scoring Mechanism
leads to adverse effects on network usability, in DAG-based networks
3.3 Mediation System greater network usage leads to improved network scalability. As such,
there is a positive correlation between the number of network users and
3.4 Native Currency
the rate at which transactions are confirmed.
3.5 Currency Exchange
This makes the DAG ideally suited for COTI’s network base layer protocol,
3.6 Decentralised Governance
enabling it to achieve full decentralisation without compromising on
4. APPLICATIONS & SERVICES COTI’s scalability, instantaneity and low-to-zero fees. Using COTI’s Trust
5. REGULATORY APPROACH Chain Algorithm, Trust Scores are the key mechanism by which new,
unconfirmed transactions select prior transactions to validate in order to
6. TEAM
reach faster transaction confirmation consensus.
7. ROADMAP
The Confirmation process
8. RISK FACTORS
To be added to the Cluster, each transaction – represented by the user’s
Trust Score – must validate two previous transactions with a similar
Trust Score threshold. As transactions are attached to the Cluster, they
collectively form Trust Chains, or transactional sets characterised by EXHIBIT 2
Components and participants in the COTI ecosystem
similar Trust Score thresholds.

The transaction validation process culminates with the Trust Chain transactions, retrieve Trust Score data from the Trust Score Servers,
Consensus Algorithm. This innovative algorithm ensures that trusted choose sources for new transactions to attach to, perform proof-of-
users (i.e. those with higher Trust Scores) are incentivised with optimised work (PoW) and allow new transactions to attach to the Cluster.
transaction confirmations, as their Trust Chains can reach the required
cumulative Trust Score threshold faster. • DSP Nodes. The Double Spend Prevention (DSP) Node is COTI’s
solution to one of the key challenges faced by DAG-based
The implicit nature of the DAG structure and validation process
cryptocurrencies. These nodes maintain an updated copy of the
enables the Cluster to reach faster consensus – achieving a transaction
Cluster at any given point in time and monitor transactions to mitigate
confirmation rate of 10,000 TPS – as compared to Blockchain systems that
any possibility of double-spending attacks. To run a DSP node, a large
can process an average of 20 TPS9.
amount of COTI must be deposited in a specialised multisignature
account. All DSP node operators are remunerated by the COTI network
1. CONTEXT Nodes
for their efforts.
COTI provides a decentralised solution, designed specifically for secure
2. OBJECTIVES
and trustworthy payments. This solution relies on the distribution of
• History Nodes. These nodes store earlier portions of the Cluster, as
3. COTI ECOSYSTEM responsibility in the Cluster to various nodes that are run by users.
well as the entire history of the Cluster. Full account history can be
3.1 Introduction to the Cluster retrieved from the History nodes; however, if the History Node is
• Full Nodes. These are primary infrastructure components and user
3.2 Trust Scoring Mechanism gateways to the network. Specifically, they receive signed wallet unable to operate for any reason, COTI's History Servers can be used
as a proxy.
3.3 Mediation System
Figure 1
3.4 Native Currency A depiction of COTI's DSP Nodes
6. TEAM
7. ROADMAP
8. RISK FACTORS
Our new transaction Two other source New transactions validate our Our transaction is confirmed by the path of
(bold circle) transactions of similar trust transaction highest cumulative trust (the cumulative Trust
are validated Score is boldened and the path of highest
cumulative trust is highlighted in green)
9
Please refer to section 8 and Appendix A of the technical whitepaper COTI Overview Document 13
3.2 Trust Scoring Mechanism questionnaire and document verification. Trust Scores update
automatically according to a user’s payment history and Big Data collected
A key source of friction in commerce today is the lack of reliable metrics by the network. For more details, please refer to the technical whitepaper.
pertaining to the trustworthiness of buyers and sellers. The difficulty in
assessing the trustworthiness of prospective counterparties undermines Figure 2
COTI's Trust Scoring mechanism
confidence and reduces the likelihood of potential transactions being seen
through to completion, particularly in cross-border scenarios.
While the reputation systems within online marketplaces address this

problem in part, such systems tend to generate reputation scores based
on user ratings alone. They are subject to abuse by parties with vested
1. CONTEXT
interests and are typically non-transferable to other marketplaces or
2. OBJECTIVES contexts.
3. COTI ECOSYSTEM
COTI takes a novel approach to building trust between transacting parties
3.1 Introduction to the Cluster through its Trust Score mechanism. The Trust Score servers analyse user
3.2 Trust Scoring Mechanism data, user behaviour, and network payment statistics to calculate a Trust
Score for each COTI network participant. The Trust Score as a metric helps
to rate participants according to their trustworthiness and contribution to
3.4 Native Currency the COTI network.

COTI is introducing a bespoke DAG-based consensus algorithm that
3.6 Decentralised Governance involves the use of Trust Scores to validate transactions. These Trust Determining Trust Scores
Scores collectively form Trust Chains, which are used for efficient Trust scoring is performed in a granular, dynamic way to provide high
transaction consensus and validation. Trust Scores further reinforce the resolution insight into a party’s behaviour. This granular approach runs
5. REGULATORY APPROACH system through soft segmentation while minimising computational burden. contrary to conventional credit scoring systems, which use broad brush
6. TEAM classification techniques to assign scores that commonly fall above or
Trust Scores incentivise users to contribute to the quality of the ecosystem below the scores that would serve as true indications of creditworthiness.
7. ROADMAP
and serve as a proxy for how reliable a participant will be in fulfilling
8. RISK FACTORS transactions in accordance with the associated terms. Trust Scores serve Trust Scores are relative values plotted on a scale of 0 to 100, with 100
as a key driver of transaction fees: high scores are associated with low-to- being the highest possible score. They provide an indication of how
zero fees, while low scores are associated with comparatively high fees. participants rank relative to one another within the COTI network, as
measured by their contributions to the network’s efficacy over time.
A participant’s Trust Score is initially determined by a general Participants that engage in honest conduct – consistently honouring

their obligations to other network participants – are rewarded with high Given the high degree to which network participants are incentivised to
Trust Scores. Conversely, participants that engage in dishonest conduct, maximise their Trust Scores, it is incumbent upon COTI to take proactive
dishonouring obligations to other network participants, are assigned lower measures to combat Trust Score manipulation and abuse. The Trust Scoring
Trust Scores, higher fees and rising confirmation times. mechanism has provisions in place for detecting anomalies that signal that
a party has attempted to manipulate its Trust Score or the Trust Score of
The Trust Score of a merchant also affects the merchant’s rolling reserve another party (e.g., a competitor). In the event of a party being found by
requirements. The rolling reserve requirements of highly trusted the algorithm to have attempted to manipulate a Trust Score, that party
merchants will be significantly lower than that of merchants with low will be subject to severe penalties, including a substantial lowering of the
Trust Scores. offending participant’s Trust Score.
Using an approach broadly resembling how Google’s search engine COTI’s Trust Score mechanism ensures that parties with low Trust Scores
1. CONTEXT
algorithms consider multiple parameters to determine web page rankings have a clear path to achieving higher Trust Scores. COTI has no intention
2. OBJECTIVES and adjust rankings as new information becomes available, the Trust of enforcing low Trust Scores on any one party in perpetuity, and actively
Scoring Algorithm considers the following parameters when determining encourages network participants to engage in organic, good-faith efforts
3. COTI ECOSYSTEM
Trust Scores: to increase their scores. If a low-scoring party can demonstrate its value
3.1 Introduction to the Cluster to the network by honest, trustworthy conduct, this value will be reflected
3.2 Trust Scoring Mechanism • Account balance - the aggregate value of transactions that the in the party’s Trust Score over time.
participant has engaged in over a set period.
• Dispute occurrence - the amount of transaction disputes that the The Trust Score mechanism is an essential component in the road to
3.4 Native Currency participant has been involved in, if any. achieving network objectives, as it encourages trustworthy user conduct
• Disputes won - the amount of disputes that were resolved in favour of and deters dishonest transacting parties. This will contribute to a more
the participant. secure and reliable network that rewards trusted ecosystem participants
3.6 Decentralised Governance • Disputes lost - the amount of disputes which were resolved in favour with low-to-zero fees.
of the counterparty.
• User ratings - the ratings that other transacting parties have assigned
5. REGULATORY APPROACH to the participant, calibrated according to the Trust Scores of the
6. TEAM parties providing the ratings.
7. ROADMAP
The set of parameters outlined above is non-exhaustive. COTI’s technical
8. RISK FACTORS whitepaper provides further details of the mechanisms used to determine
Trust Scores.
Figure 3
Measures against Trust Score manipulation The different Trust Chain lengths needed to confirm moderately trusted transactions (left)
and highly trusted transactions (right).

The Mediation System serves three main objectives: decentralised
governance, security and reliability. In order to provide buyers and
sellers with protections against errors, fraud and counterparty abuse,
mediators must take responsibility if disputes arise within the network.
Figure 4
While the Trust Score adds a layer of trust to all COTI network transactions COTI's Mediation System
and imposes disincentives on behaviour that is dishonest or unfair, the
Mediation System provides an additional mechanism that facilitates
dispute resolution in an effective and cost-efficient manner.
1. CONTEXT
Typical scenarios requiring mediation include the following:
2. OBJECTIVES
• Billing errors. The buyer completes a purchase, but later realises that
3. COTI ECOSYSTEM
the amount paid for the goods or services was incorrect.
• Inadvertent transfers. The user inadvertently sends funds to the
3.2 Trust Scoring
wrong party.
3.4 Native Currency • Unauthorised charges. The user is charged an amount without having
authorised the transaction.
3.6 Decentralised Governance • Undelivered goods or services. The buyer pays a merchant for goods
or services but the delivery of those goods or services is not fulfilled.
5. REGULATORY APPROACH • Non-conforming goods or services. The buyer pays for and receives
the goods or services, but the goods or services do not conform with
6. TEAM
the description or standards the seller conveyed at the time of the
7. ROADMAP purchase.
8. RISK FACTORS
In each of the above scenarios, if the sender and receiver of funds are
unable to resolve the dispute directly, the unsatisfied party can initiate
mediation.

The role of mediators Figure 5
Main components of the COTI Mediation
As Bitcoin’s inventor Satoshi Nakamoto observed, one of the shortcomings
System
of traditional payment systems is that, in providing mediation services,
payment providers necessarily incur significant costs, which result in
higher transaction fees. Thus, a key challenge was determining how to
provide buyers and sellers with robust safeguards in a streamlined, cost-
efficient manner.
COTI’s approach to mediation involves harnessing a decentralised and

distributed group of independent mediators to resolve disputes. Mediators
work independently to validate real world information pertaining
1. CONTEXT
to transaction disputes and then cast votes on a mediated outcome.
2. OBJECTIVES Mediators receive caseloads and cast their votes using the mediator
client (presented in 4. Applications & Services). They are not able to
3. COTI ECOSYSTEM
communicate with one another and are unaware of how many other
3.1 Introduction to the Cluster mediators are involved in resolving a dispute.
3.2 Trust Scoring
The method for determining consensus is underpinned by the game
theoretic notion of Schelling points (i.e., focal points). The rationale here is
3.4 Native Currency that mediators are encouraged to reach similar conclusions on a dispute
and, in the absence of being able to coordinate, to look for focal points
that provide the truest proof of events that occurred between the buyer
3.6 Decentralised Governance and the seller. In effect, the system relies on appealing to the intuition of
each mediator.
5. REGULATORY APPROACH After mediators’ votes have been cast, they are assessed using a voting
6. TEAM matrix that determines consensus automatically. Once a mediated outcome
has been arbitrated by a quorum of mediators, the system compensates
7. ROADMAP
the winning party and returns that party’s balance to its rightful state.
8. RISK FACTORS If the customer is the winning party, he/she is remunerated using funds
from the merchant’s rolling reserve. In case of insufficient rolling reserve
funds, compensation is remitted from the Reserve Credit Fund (RCF). When
the merchant is the winning party, on the other hand, no further action is
needed.

Merchant rolling reserve Other mediation provisions
Rolling reserve requirements are calculated based on the merchant’s To ensure the Mediation System is cost-effective and consistently achieves
turnover and Trust Score. Because of the design of the COTI payments dispute resolution in a manner that benefits the network overall, COTI has
network, Mediation System and decentralisation, the rolling reserve taken several additional factors into consideration.
requirements are substantially lower than existing payments networks.
Mediator recruitment and training. Individuals who wish to register
Every merchant transaction will incur a rolling reserve fee that is reserved as mediators must satisfy certain requirements before being admitted
for a number of days. When the rolling reserve term has ended, funds are to the mediator platform. Among other requirements, mediators must
released back to the merchant’s account. demonstrate relevant language proficiency and undergo an online
assessment to determine they have the aptitude to perform the mediation
1. CONTEXT The rolling reserve is used when a merchant has lost a mediated dispute tasks at a high standard. COTI endeavours to make mediation open to a
and is required to compensate the consumer. Merchants that do not meet broad group of people and will make available online training programs
2. OBJECTIVES
the rolling reserve requirements will forfeit their ability to sell goods and that can assist candidates in acquiring the requisite knowledge for
3. COTI ECOSYSTEM services within the COTI network. contributing to the dispute resolution process effectively.

Collusion prevention. Due to its distributed nature, the Mediation System
3.2 Trust Scoring Mechanism Comparison of COTI’s rolling reserve with existing online payment systems needs to account for the prospect of mediators engaging in collusion—
either with one another, or with one of the parties in a disputed
transaction. This risk of collusion is mitigated primarily through the
3.4 Native Currency COTI OTHER PAYMENT SYSTEMS
algorithms that determine which mediators are assigned to a specific
3.5 Currency Exchange dispute, whereby caseloads are routed intelligently to mediators who have
The minimum rolling reserve requirement Rolling reserve requirements are usually the least likelihood to collude with one another. If mediators are found to
3.6 Decentralised Governance is at least 3% and based on the Trust above 10%
Score of the merchant have engaged in any form of collusion, they will be severely penalised.
Privacy concerns. Prior to distributing caseloads, COTI takes measures
5. REGULATORY APPROACH Funds are frozen for at least 7 days Funds are frozen for 14-90 days
depending on the business type to ensure that only the data that aids directly in dispute resolution is
6. TEAM disclosed. By default, COTI removes personal identifying information
from all data submissions. If the parties to a dispute so choose, they can
7. ROADMAP Equitable dispute settlement by COTI’s Rampant credit card chargebacks and non-
Mediation System transparency elect to forgo privacy for the sake of providing richer data. During the
8. RISK FACTORS mediator registration process, all mediators are required to read and accept
a mediator privacy policy, any violation of which will result in expulsion
from the COTI network.

3.4 Native Currency (COTI) • Fees. All fees incurred in the course of using the COTI network
(payments, mediation, node oversight and external projects based on
COTI’s native digital currency sits at the centre of the COTI network and COTI’s Cluster) are payable in COTI coins.
fuels the interactions between consumers, merchants, mediators and
node operators. COTI was purpose-built to overcome the barriers that •••
have limited the widespread adoption of digital currencies in day-to-day
payments.
The aspiration is for COTI to become widely adopted for general payment
The primary function of COTI coins is to serve as the common purposes — to become the Currency Of The Internet. Scalability will not
denominator of payments, fees and mediation and to incentivise node serve as the sole catalyst of adoption, as Austrian School economist
operators in the COTI network: Ludwig von Mises posited in his regression theorem10, in order for a
1. CONTEXT
currency to reach the point of being widely accepted as a general medium
2. OBJECTIVES • Payments. COTI coins function as a medium of exchange that can be of exchange, it first needs an objective framework for determining its
used when making and receiving payments in the COTI ecosystem. price.
3. COTI ECOSYSTEM
While the COTI network supports multiple fiat and digital currencies,
3.1 Introduction to the Cluster participants are incentivised to use COTI over other currencies for its Although value transfer is the COTI coin’s primary function within the COTI
efficacy as a payment method and low-to-zero transaction fees. network, it will also be used as a means of paying fees and incentivising
3.2 Trust Scoring
mediators and node operators. The above provides an objective
3.3 Mediation System • Mediation. Mediator stakes and payouts are denominated in COTI framework that will determine COTI’s price in relation to other currencies
3.4 Native Currency coins. As such, mediators are required to hold COTI coins whenever
they wish to engage in mediation.
3.6 Decentralised Governance • Merchant rolling reserve. A share of a merchant’s transactions that
is temporarily set aside to cover potential business risks, such as
when a merchant loses a mediated dispute and must compensate the
5. REGULATORY APPROACH consumer. Rolling reserve funds are denominated in COTI coins and
automatically accumulate in the merchant’s account for a defined
6. TEAM
term.
7. ROADMAP
8. RISK FACTORS • Node operators. Operators of all node types will be incentivised in
COTI coins and will be required to hold COTI whenever they wish to
validate node activity.
10
The Theory of Money and Credit, Ludwig von Mises, 1912 COTI Overview Document 19
COTI aims for its payments network to be versatile with respect to currencies, thus providing an easy-
to-use payment solution. To this end, COTI is developing a currency exchange that provides network
participants with continuous access to liquid markets in a range of digital and fiat currency pairs.
The main functions of the exchange are three-fold.
1. CONTEXT
• First, it serves as an enabler of cross-currency payments by providing
2. OBJECTIVES network participants a straightforward mechanism for paying or
receiving funds in whichever currencies they choose, regardless of
3. COTI ECOSYSTEM
their counterparties’ preferred currencies.
3.2 Trust Scoring • Second, it provides end-users with a direct mechanism for transferring
their holdings from one currency to another, if for whatever reason
end-users wish to increase or reduce their exposure to a specific
3.4 Currency Exchange currency.

• And third, it is an enabler of the market-making activity in which
3.6 Decentralised Governance COTI’s native currency serves as the common denominator amongst all
other currencies.
5. REGULATORY APPROACH Seamless interoperability

6. TEAM COTI abstracts the complexity of currency exchange from end-users. The
exchange functions as a foundational layer of COTI’s applications and
7. ROADMAP
services, operating in the background to ensure that participants’ currency
8. RISK FACTORS exchange requests are fulfilled automatically in response to the actions
taken from the consumer, merchant and mediator interfaces. For each
order, rather than presenting an orderbook and bid/ask prices, the user is
presented with a single fixed rate, inclusive of any fees.

EXHIBIT 3
Simplified depiction of the COTI network’s liquidity flows
1. CONTEXT
2. OBJECTIVES
3. COTI ECOSYSTEM
3.2 Trust Scoring
3.4 Native Currency
6. TEAM
7. ROADMAP
8. RISK FACTORS

Global order book
Behind the scenes, the exchange works for end-users to provide the best
fulfilment and execution possible while guaranteeing that the originally- To provide a decentralised ecosystem for online payments, COTI will
quoted rates are adhered to. COTI achieves this by amalgamating multiple explore various decentralised governance models. Such governance will
liquidity sources to create a global order book. For a visual representation provide voting rights for executing changes in COTI’s base protocol and
of the exchange’s liquidity flows, please refer to Exhibit 3. deciding future use cases of the COTI coin. Futarchy governance is one
such methodology that utilises a team of experts who work to define
When generating quotes based on the order books of multiple exchanges, metrics for implementing new developments. COTI coin holders can then
COTI uses ‘look ahead’ algorithms to predict the rates it can honour. Upon collectively vote for the best possible outcome to reach a decision based
receiving an order, the exchange works through its global order book, on the wisdom of the crowd.
allocating quantities that need to be reserved across COTI’s exchange and
1. CONTEXT
third party exchanges to ensure the order is filled successfully.
2. OBJECTIVES
Security and fault tolerance
3. COTI ECOSYSTEM
COTI’s exchange is designed to be highly secure and fault-tolerant. The
3.1 Introduction to the Cluster exchange implements a multi-tiered security architecture that limits attack
3.2 Trust Scoring vectors and attack ingresses. All traffic in COTI’s exchange is encrypted
end-to-end using Transport Layer Security (TLS) 1.2 (utilising SHA256
keys), and all data-at-rest is secured with AES-256 encryption. Each step
3.4 Native Currency in the currency exchange process is transactional, such that if any part of
a step in the exchange process fails, the entire step fails.
3.6 Decentralised Governance •••

COTI’s exchange is first and foremost a component for facilitating cross-
5. REGULATORY APPROACH currency payments in a way that is maximally beneficial for network
6. TEAM participants. It serves the secondary function of providing users with a
means of adjusting their exposure to different fiat and digital currencies,
7. ROADMAP
and connects seamlessly to all of COTI’s applications. Over time, additional
8. RISK FACTORS exchange functionality will be added to accommodate more elaborate use
cases — for example, adding support for a wider array of order types.

4. Applications & Services
COTI is developing a suite of applications and service offerings that will provide consumers, merchants and
mediators with seamless connectivity to the COTI network.
4.1 For Consumers

The first pillar of the COTI network’s success is the extent to which it • Storing digital and fiat currencies securely. COTI users will be able to
1. CONTEXT
establishes a critical mass of consumers equipped to use its payment use their COTI wallets as de facto bank accounts for the purpose of
2. OBJECTIVES solutions for peer-to-peer payments and merchant payments alike. To holding funds in both digital and fiat currencies. In the first instance,
3. COTI ECOSYSTEM this end, COTI is developing consumer offerings that will provide user- funds can be deposited into COTI wallets using card, bank wire and
friendly gateways to a range of payment-related services, encompassing several leading digital currencies.
both fiat and digital currencies. Because the relative complexity of digital
4.1 For Consumers currencies has inhibited their widespread adoption in payment use cases • Exchanging digital and fiat currencies. COTI users will be able to use
thus far, a primary focus of COTI’s application design efforts has been their wallets to move funds from one currency to another by posting
4.2 For Merchants
on making digital currencies as easy to acquire and use as their fiat market or limit orders to COTI’s exchange. The currencies supported
4.3 For Mediators equivalents. at the outset will include USD, EUR, GBP, and several leading digital
currencies, including COTI’s native currency.
4.4 For External Projects
Wallets
5. REGULATORY APPROACH COTI’s main consumer offering is a multi-currency wallet that provides
6. TEAM instant and easy access to the COTI payments network and supports a
variety of consumer payment use cases.
7. ROADMAP
8. RISK FACTORS • Peer to peer transactions. COTI users will be able to make instant,
secure transfers to their peers who hold COTI wallets. Transfers will
be instant with low-to-zero fees (depending on the users’ Trust Scores
and currency selections).
• Nearby wallet-to-wallet transactions. COTI wallet holders will be able

to send funds in a secure, instant and intuitive manner to other COTI
wallet holders through close physical proximity.

The COTI wallet is being developed as a native mobile application and
as a web application accessible via COTI’s website. Users will be able to
open wallets via the COTI website and applications, as well as during the
checkout procedure on COTI-powered merchants’ websites.
Debit cards
To connect the COTI network with other payment rails, COTI is offering
users access to debit cards that link directly to COTI wallets. The rationale
for offering these cards is that they will enable users to effect payments
from their COTI wallets when dealing with merchants that have not yet
integrated with COTI.
1. CONTEXT
2. OBJECTIVES COTI users will be able to specify their preferred currency each time
they create a virtual debit card. When a purchase is made using a card
3. COTI ECOSYSTEM
linked to a currency that does not match the payment currency, COTI’s
4. APPLICATIONS & SERVICES exchange will automatically convert the required amount of the card-
4.1 For Consumers linked currency to the purchase currency, thereby mitigating third-party
currency exchange fees.
4.2 For Merchants
4.3 For Mediators •••

The relative complexity of digital currencies continues to undermine their
5. REGULATORY APPROACH adoption by mainstream consumers. The COTI team aims for its consumer
offerings to abstract this complexity from end-users, with a view to
6. TEAM
increasing digital currencies’ mainstream adoption.
7. ROADMAP
8. RISK FACTORS
In addition to supporting a variety of payment, storage and exchange
use cases, COTI’s wallet will provide an ideal entry point for mainstream
consumers looking to venture into the digital currency domain for the first
time.

4.2 For Merchants
The second pillar of the COTI network’s success is the extent to which it As COTI’s network grows, COTI will introduce additional solutions for
can attract and retain a large base of merchants that accept payments merchants, including supplier and employee payments, thereby enabling
using COTI’s rails. To this end, COTI is developing a suite of merchant tools merchants to carry out a greater variety of payment functions from within
and services that make COTI a compelling proposition for merchants, as an the COTI network.
addition to, or as a replacement for, their existing payment systems.
Processing tools
1. CONTEXT COTI is developing processing tools that will enable merchants to start
2. OBJECTIVES accepting payments from COTI wallet holders. Consumers who visit COTI-
powered merchants’ websites, but do not hold COTI wallets, will be invited
3. COTI ECOSYSTEM
to open wallets instantly as part of the checkout process. Merchants will
4. APPLICATIONS & SERVICES be able to choose whether they wish to connect to COTI’s payment rails
via API or by embedding an iFrame into their websites. The merchant
4.1 For Consumers
onboarding process will be streamlined to the point that integration can
4.2 For Merchants be completed within a few hours. The integration process will be made
simpler by the fact that COTI’s processing solutions will be compatible
4.3 For Mediators
with several widely-adopted e-commerce platforms (e.g., Shopify and
4.4 For External Projects Magento).
COTI-powered merchants will have access to a dashboard that provides
6. TEAM
detailed data and reporting functionality on their COTI network
7. ROADMAP transactions. Within this dashboard, merchants will choose which COTI-
supported currencies they wish to accept, as well as their preferred
8. RISK FACTORS
settlement currencies. Moreover, the dashboard will provide merchants
with wallet-like functionality that enables them to make payments to COTI
wallet holders and to other COTI-powered merchants, as well as to use
COTI’s currency exchange facility. Merchants will also be able to run their
own Full Node with a customised wallet to streamline the transactional
experience for customers.

Hedging services
COTI recognises that one of the barriers preventing merchant acceptance EXHIBIT 4
of digital currencies is the volatility they may be exposed to between the Simplified example of a 30-day COTI put option
time a payment is received and the time of settlement. COTI will remove
this barrier by providing COTI-powered merchants with access to hedging
services that enable them to reduce, or eliminate, their exposure to near-
term currency fluctuations.
—— To mitigate a merchant’s exposure to fluctuations in COTI’s price, put

options will assist merchants with securing future exchange rates. In
the early stages, these hedging services will initially be limited to a
1. CONTEXT
30-day period and will only cover payments denominated in COTI
2. OBJECTIVES coins. A Black-Scholes option model will be used for the put option
price, while the option premium will be calculated based on the option
3. COTI ECOSYSTEM
strike price, the option term and COTI’s price volatility.
4.1 For Consumers A simplified example of a 30-day option contract that would enable
a merchant to hedge its downside exposure to COTI relative to the
4.2 For Merchants
USD, together with a simplified depiction of the option’s hypothetical
4.3 For Mediators payoffs, is provided in Exhibit 4: Simplified example of a 30-day put
option.
5. REGULATORY APPROACH —— COTI will create an internal derivatives market that enables network
participants to enter forwards contracts and buy and sell put/call
6. TEAM
options that are denominated in COTI coins. Over time, derivative
7. ROADMAP pairings, such as COTI/USD, will be expanded to meet market
8. RISK FACTORS developments.
COTI will assist derivative market participants in mitigating counterparty

risk. When entering forwards contracts or selling call/put options, market
makers will be required to deposit collateral into a special margin account
that is denominated in COTI coins. The margin requirement will be lower
for network participants with high Trust Scores and higher for those with
low Trust Scores.

4.3 For Mediators 4.4 External Projects
The third pillar of the COTI network’s success is the extent to which it can The COTI network will enable external projects to build their applications
attract and retain a sufficient volume of capable mediators to address the based on COTI’s innovative distributed ledger technology. To this end,
volume of disputes occurring in the network at any given time. In addition COTI is developing a suite of tools, services and incentive programs that
to having sufficient economic incentives, as described in section 3.3: The will support third parties with migrating their technology to COTI’s base
Mediation System, mediators require tools to facilitate their contributions layer protocol.
to the dispute resolution process.
COTI is developing a separate application to accommodate mediator use

cases. The mediator application will largely resemble the consumer wallet,
1. CONTEXT but will offer enhanced functionality that enables mediators to serve
2. OBJECTIVES their roles effectively. Amongst other functions, the application will allow
mediators to accept invitations to receive and review caseload data, to
3. COTI ECOSYSTEM
place wagers, and, in the event of successfully contributing to a mediated
4. APPLICATIONS & SERVICES outcome, to receive payouts in COTI.
4.1 For Consumers
4.2 For Merchants
4.3 For Mediators
6. TEAM
7. ROADMAP
8. RISK FACTORS

5. Regulatory Approach
COTI’s legal advisors are laying the licencing and regulatory foundations that will enable the COTI network
— and its native currency, COTI — to achieve global scale and reach. While the digital currency landscape
is currently characterised by a high degree of regulatory uncertainty, the COTI network stands to benefit
from the onset of new digital currency-specific regulations.
1. CONTEXT
Early adopters of digital currencies have long held the view that digital coin offering warnings and the People's Republic of China's ban on it all
2. OBJECTIVES
currencies will continue to thrive outside the strictures of governments. together.
3. COTI ECOSYSTEM The COTI team’s somewhat contrarian view is that, like the Internet
before it, digital currencies will only come of age — and yield the greatest To promote the onset of suitable digital currency-specific legislation, the
benefits to consumers and businesses — by operating within the bounds of COTI team and its legal advisors are working with regulators globally
5. REGULATORY APPROACH the laws and regulations of sovereign states. to help shape the relevant regulatory frameworks and to share COTI’s
6. TEAM experiences as a global digital currency initiative.
In order for digital currencies to achieve widespread adoption in payment,
7. ROADMAP
digital currency-related organisations — whether decentralised or not —
8. RISK FACTORS they will need to adhere to the laws and regulations of the jurisdictions
in which their end-users reside. And in the absence of digital currency-
specific regulations, organisations should take a proactive approach by
adhering to the know your customer (KYC), anti-money-laundering (AML)
and Treat Clients Fair (TCF) standards, which are now commonplace in the
provision of financial services-oriented activities.
Although digital currencies today are largely unregulated, regulatory

authorities in several jurisdictions have grown increasingly outspoken
about their intentions to implement digital currency-specific regulatory
regimes. Some jurisdictions — including Ecuador and Bangladesh —
have altogether banned the use of Bitcoin and other digital currencies.
However, much of the recent regulatory attention has centred on initial

Licensable activity examined the currency’s unique features in consultation with additional
Certain aspects of the COTI network’s activity relate to the provision legal experts from reputable law firms in several key jurisdictions.
of digital wallet and exchange services, both of which are licencable According to the legal opinions received, COTI does not classify as a
activities in the jurisdictions examined. As such, COTI is pursuing licence security, and the sale of COTI coins to members of the public does not
authorisations globally in respect of the following: constitute a breach of the relevant regulations.
• Payments and money services. Such licenses cover the provision of •••
merchant processing solutions in fiat currency, enabling COTI-powered
merchants to accept payments in digital and fiat currencies. COTI is laying a global licencing footprint for its licensable activity, and is
adhering to strict AML and KYC standards in all aspects of its activity —
• Exchange and e-wallet services. Such licences cover the provision even those which are not currently subject to formal regulatory oversight.
1. CONTEXT
of exchange and wallet functionality, enabling COTI to provide
2. OBJECTIVES individuals and merchants with the ability to hold, exchange and The COTI network will benefit from greater regulatory clarity in respect
transact in digital currencies. of digital currencies. If properly designed, regulations will not constrain
3. COTI ECOSYSTEM
innovation, but rather function as enablers of mainstream digital currency
4. APPLICATIONS & SERVICES Pursuant to advice from its legal advisors, the COTI network will expand adoption. The COTI team and its legal advisors aim to serve as catalysts
5. REGULATORY APPROACH its licence portfolio to ensure maximum geographic coverage. for positive regulatory change and are working with regulators globally to
make a meaningful contribution to the dialogue.
6. TEAM
AML and KYC procedures
7. ROADMAP The COTI network is adopting appropriate AML and KYC procedures to
ensure that its network cannot be used to facilitate money laundering or
8. RISK FACTORS
other illicit activity. COTI is inherently not conducive to money-laundering,
as any user of COTI’s wallet, exchange or processing solutions must
undergo strict onboarding procedures. Notwithstanding its commitment to
AML and KYC, COTI is similarly committed to protecting user privacy and
has appropriate consumer data protection mechanisms in place.
COTI is not a security

According to advice received, the offering of digital currencies may
also involve the offer and sale of securities, depending on the facts and
the circumstances. And the offer and sale of securities is likely to face
financial and securities regulation worldwide.
With respect to COTI’s native currency, COTI’s legal advisors have

6. Team
The COTI team is comprised of individuals with extensive experience in the payments, cryptography
and financial services domains. The core team is supported by internationally recognised advisors with
backgrounds in payments, asset management, banking, marketing and more.
1. CONTEXT
2. OBJECTIVES
3. COTI ECOSYSTEM
4. APPLICATIONS & SERVICES Shahaf Bar-Geffen Erol Hallufgil Tal Dadia

CEO Research and Software Engineer Research Engineer
Shahaf is the co-founder and former CEO Eli previously headed up the developers team Tal was a former back-end developer and
6. TEAM
of WEB3, a leading multinational digital at TechChain Solutions. He holds a master's blockchain academic researcher. He holds
7. ROADMAP marketing firm. Shahaf holds a BSc degree degree in mathematics from the Technion, an MA in financial economics and financial
in biotech and economics from Tel Aviv Israel Institute of Technology. engineering from IDC Herzliya.
8. RISK FACTORS University.
Yoni Neeman Stav Perle Anton Suslonov

Software Engineer Cryptographer Data Science
Yoni is a graduate in computer science from Stav is a Yahoo! Inc researcher, a previous Anton is an expert in blockchain technology,
Tel Aviv University. He has previously held software developer at Intel Corporation and applied mathematics and data science.
roles as a software engineer and full stack researcher at IBM. She holds an MSc degree in
developer at a number of tech companies. computer science from the Technion.

David Assaraf Eyal Wagner Yair Lavi
Co-founder, Business Development Head of Legal Head of Operations
David previously served as the chief internal Eyal is a legal expert with vast experience Yair was the former CEO and finance director at
auditor at HSBC Israel and as an examiner in fintech. Eyal was the CEO of Safecap Plus500 UK. He has also held previous roles in
in the credit risk unit of the Bank of Israel’s Investments and the group general counsel for financial planning and valuation strategy.
1. CONTEXT
banking supervision department. Markets.com.
2. OBJECTIVES
3. COTI ECOSYSTEM
6. TEAM
7. ROADMAP
8. RISK FACTORS
Gilad Hirsch Samuel Falkon Neta Salomon

CFO Co-founder, VP Community HR Manager
Gilad has over a decade of experience at Samuel has vast experience in the digital Neta has previously worked as an HR manager
financial institutions including Ernst & Young, currency and fintech industries and has held at a number of leading finance and hi-tech
KPMG and the Bank of Israel. previous roles in product development. companies.

Board of Advisors
Dr Matt McBrady Avi Chesed Steven Heilbron

Former CIO & MD BlackRock Co-founder, CEO Processing.com Former CEO Investec Bank UK
Matthew was the CIO for the hedge fund Avi is the co-founder and CEO of Processing. Steven has served as the global head of
1. CONTEXT platform at BlackRock. He has held senior com. He was previously the chair of the board private banking and joint CEO of Investec Bank
roles at Silver Creek Capital and Bain Capital. of directors of Transact Europe Holdings. in London.
2. OBJECTIVES
3. COTI ECOSYSTEM
6. TEAM
7. ROADMAP Stas Oskin Sebastian Stupurac Jon Avganim

WINGS Foundation Co-founder WINGS Foundation Co-founder Co-founder, President Processing.com
8. RISK FACTORS
Stas heads up WINGS Foundation, a Swiss non- Sebastian is the co-founder of WINGS, a smart Jon is the executive director of Transact
profit focused on decentralised finance and contract facilitation platform operating on the Europe Holdings OOD. Jon has founded
governance systems. DAPPS Ethereum blockchain. and led several successful ventures in the
international finance domains.
For more information on

the COTI team, visit
Dr Zvi Gabay Stephan Wessel
Partner, Barnea & Co. CEO Arcana Capital
An expert in financial regulation and securities Stephan is the founding partner of Arcana
law, Zvi is a partner and the head of capital Capital. He has previously held senior roles at
markets at Barnea & Co. Rianta Capital and Gaydoul Group.

7. Roadmap
COTI’s roadmap sets out the key launch milestones that will shape development priorities between now
and the end of 2021. The visual roadmap representation provided below is accompanied by detailed
milestone explanations on the pages that follow.
1. CONTEXT
2. OBJECTIVES
3. COTI ECOSYSTEM
6. TEAM
7. ROADMAP
8. RISK FACTORS

Development Progress to Date Phase 2 Milestones – Q2 2019
Since its formation in early 2017, the COTI team has focused primarily on COTI aims to achieve the following milestones in Q2 2019.
researching and developing the best purpose built solution for a digital
payments network. The base layer protocol, modeled off of the DAG data • Consumer wallet launch. COTI’s release of the consumer wallet will
structure, and the API for merchants are both in progress. COTI has also kickstart the COTI ecosystem, providing consumers with the ability
been working on developing its exchange infrastructure and consumer to send, receive, exchange and pay with multiple fiat and digital
wallet offering and on defining the mechanics of its Trust Scoring currencies, including COTI. The iOS, Android and web application will
Mechanism and Mediation System. The exchange and the consumer wallet initially support USD, EUR, GBP, BTC, ETH and COTI, with additional
are approaching completion and will be put to work this year. support to be rolled out on an ongoing basis subject to network
demand.
Phase 1 Milestones – Q4 2018
1. CONTEXT
The initial release of COTI’s services in Q4 2018 will be limited to testnet. • Launch of the Full Nodes, History Nodes and DSP Nodes. Users can
2. OBJECTIVES begin to run their own independent Full Nodes, History Nodes and
• Consumer wallet prototype. The initial beta release of the consumer DSP Nodes.
3. COTI ECOSYSTEM
wallet will provide the baseline functionality of sending and receiving
4. APPLICATIONS & SERVICES COTI coins and other digital currencies. • Trust Score Server launch. At this stage, the Trust Score Servers will
5. REGULATORY APPROACH begin calculating Trust Scores in line with KYC/AML documentation
• Full Node prototype. This will encompass a beta version of the Full and statistical parameters.
6. TEAM
Nodes to demonstrate COTI’s payment system functionality.
7. ROADMAP • Decentralised mediation prototype. COTI will release a prototype of
• DSP Nodes prototype. Coinciding with the release of COTI’s Full Node its decentralised mediation system and will begin optimising it with a
8. RISK FACTORS
prototype, a beta version of the Double Spend Prevention Node (DSP) select group of mediators and test users.
will be rolled out to optimise standards for mitigating double-spending
attacks. • Mainnet launch. The network will begin to engage users to create
wallets and run nodes. At this phase, COTI will be delivered to user
• History Node prototype. To provide a functional solution for the wallets.
size management of a maturing DAG structure, a beta version of the
History Nodes will be released along with the Clusterstamp algorithm. Phase 3 Milestones – Q4 2019
COTI aims to achieve the following milestones in Q4 2019.
• Trust Score Server prototype. COTI will set the Trust Score Algorithm
into motion and begin supplying Trust Scores to the Full Nodes. • KYC/AML Server launch. This component of the payment system will
enable COTI to engage with international users and merchants by
• Testnet launch. The COTI testnet will be launched based on the adhering to know your customer (KYC) and anti-money laundering
functional prototypes of the servers listed above. (AML) requirements.

• Decentralised mediation launch. Following extensive testing, COTI will maintenance fees.
implement its decentralised Mediation System, enabling mediators
to contribute to case resolution and to be compensated in COTI coins. • Hedging service launch. COTI will launch a hedging service that
To coincide with the launch of the decentralised Mediation System, enables merchants to limit or eliminate their exposures to fluctuations
COTI will launch a dedicated application enabling mediators to receive in COTI’s market price.
caseloads and contribute to the consensus-building process.
• Recurring billing. COTI will enable merchants to use COTI’s payment
• Payment processing tools (API). COTI’s initial release of its payment rails for recurring billing (e.g., subscription services).
processing tools will provide merchants with the ability to accept
payments from consumers holding COTI wallets and to access rich Phase 5 Milestones – 2021
reporting and analytics. Merchants will be able to integrate COTI’s COTI aims to achieve the following milestones in the course of 2021:
1. CONTEXT
processing solutions via API and will be able to accept payments and
2. OBJECTIVES receive payouts in various fiat and digital currencies, including COTI. • Expansion of merchant services. COTI will launch additional merchant
services, with a view to playing an increasingly central role in
3. COTI ECOSYSTEM
• Payment processing tools (iFrame). COTI will release an iFrame that merchants’ payment affairs. These additional services will enable
4. APPLICATIONS & SERVICES merchants can embed in their websites, thereby streamlining the merchants to conduct an increasing array of operational functions,
5. REGULATORY APPROACH technical integration process. The iFrame will enable COTI wallet including payroll and supplier payments, through the COTI network.
registration to occur as part of the checkout process on COTI-powered
6. TEAM
merchants’ websites. • COTI Fund. The launch of COTI’s Trust Scoring and Mediation SDKs
7. ROADMAP will coincide with the launch of COTI’s Fund, a pool of capital that will
• Exchange. In order to support consumer and merchant activity, inject funds into third party development projects that are building
8. RISK FACTORS
COTI will simultaneously roll out its exchange solution, allowing the on top of COTI’s infrastructure. The Fund’s principals, who will be
wallet and processing services outlined above to connect seamlessly responsible for the allocations, will be determined in part by the COTI
to sources of liquidity when exchanging funds between different community’s preferences.
currencies.
• Mediation SDK launch. COTI will expand the reach of its network
Phase 4 Milestones – 2020 of mediators, and corresponding systems, by allowing authorised
COTI aims to achieve the following milestones in 2020: third party developers to connect to the network and leverage the
decentralised mediation capabilities. For example, a third-party
• Debit card launch. COTI will launch virtual debit cards that enable COTI payments network may wish to adopt COTI’s decentralised mediation
wallet-holders to spend from their wallets using the payments rails of system as an alternative to its existing centralised system. The SDK
major card networks. COTI users will be able to obtain these cards for will make such integrations possible while enabling COTI to improve
a nominal issuance fee, and will not be required to pay any ongoing

• the system, both in terms of efficacy and cost-effectiveness.
•••
COTI has set out an ambitious, yet achievable, development roadmap.

This roadmap represents the COTI team’s current understanding of the
launch sequence that will ensure the COTI network delivers the maximum
achievable benefits to all network participants within the shortest
amount of time possible. Notwithstanding the aforesaid, the COTI team is
committed to working with the COTI community to expand or otherwise
adjust the characterisation and prioritisation of the key milestones where
1. CONTEXT
necessary.
2. OBJECTIVES
3. COTI ECOSYSTEM
6. TEAM
7. ROADMAP
8. RISK FACTORS

8. Risk Factors and Legal Disclaimers
IMPORTANT NOTICE: PROSPECTIVE SUBSCRIBERS SHOULD CAREFULLY READ THE WHOLE OF THIS OVERVIEW DOCUMENT,
TOGETHER WITH THE "LEGAL CONSIDERATIONS, RISKS AND DISCLAIMERS” AVAILABLE ON COTI.IO. WE RECOMMEND THAT
YOU CONSULT WITH A LEGAL, FINANCIAL AND TAX PROFESSIONAL OR OTHER ADVISOR FOR FURTHER GUIDANCE PRIOR TO
PARTICIPATING IN THE COTI LIMITED TOKEN SALE. YOU ARE STRONGLY ADVISED TO TAKE INDEPENDENT LEGAL ADVICE WITH
RESPECT TO THE LEGALITY OF THE TOKEN SALE IN YOUR JURISDICTION. YOU SHOULD NOTE THAT YOUR ACKNOWLEDGMENT
AND ACCEPTANCE OF THE TOKEN SALE'S TERMS AND CONDITIONS REPRESENTS THAT YOU HAVE SOUGHT PRIOR
1. CONTEXT
INDEPENDENT LEGAL ADVICE.
2. OBJECTIVES
3. COTI ECOSYSTEM
4. APPLICATIONS & SERVICES Please note that this is a summary of the full terms, which can be found Information and the Token Sale (such terms hereinafter referred to as
on www.coti.io, and must be read in full before: (i) making use of this the “Terms”).
Overview Document, the technical whitepaper, the Token Sale Summary
6. TEAM and any and all information available (the “Available Information”) on the • The information set forth in the “Legal Considerations, Risks and
website(s) of COTI Limited (the “Company”) at www.coti.io (the “Website”); Disclaimers” section may not be exhaustive and does not imply
7. ROADMAP
and/or (ii) participating in the Company’s token sale outlined in the any elements of a contractual relationship. While we make every
8. RISK FACTORS Available Information (the “Token Sale”). Any undefined capitalised terms reasonable effort to ensure that all information — (i) in the Available
below shall have the meaning set out in the “Legal Considerations, Risks Information; and (ii) as available on the Website — is accurate and up
and Disclaimers” section. This summary should not be relied on in place of to date, such material does not constitute professional advice in any
reading the “Legal Considerations, Risks and Disclaimers” paper in full. way.
• The full version of the “Legal Considerations, Risks and Disclaimers” • The Company does not recommend purchasing coins for speculative
mentioned above applies to the Available Information and to all investment purposes. Coins do not entitle you to any equity,
information available on the Website. The contents of the “Legal governance, dividend, voting or similar right or entitlement in the
Considerations, Risks and Disclaimer” section outlines the terms and Company or in any of its affiliated companies. Coins are sold as digital
conditions applicable to you in connection with (i) your use of this assets, similar to downloadable software, digital music and the like.
Token Sale Summary, the technical whitepaper and of any and all The Company does not recommend that you purchase coins unless
information available on the Website; and/or (ii) your participation you have prior experience with cryptographic coins, blockchain-based
in the Token Sale, in each case in addition to any other terms and software and distributed ledger technology and unless you have taken
conditions that we may publish from time to time relating to Available independent professional advice.

• Citizens, nationals, residents (tax or otherwise) and/or green card Jurisdiction-specific regulatory disclaimers
holders of Restricted Jurisdictions and Restricted Persons (as defined • Non-distribution to the public in the United States:
in the full version of “Legal Considerations, Risks and Disclaimers”) COTI coins will be made available only to subscribers who meet
shall not process the Available Information and/or are prohibited from the “accredited investor” status. A thorough assessment will be
participation in the Token Sale, or the purchase of coins, or any such undertaken by an external reputable US-based service provider for
similar activity such applicants in an effort to deploy prudent compliance standards
. and to offer the COTI coins in line with regulatory frameworks to
• In no event shall the Company or any current or former Company those who have the capacity to comprehend any perceived risks.
Representative be liable for Excluded Liability Matters (as defined in
the full version of “Legal Considerations, Risks and Disclaimers”). • Notice to prospective United Kingdom subscribers:
1. CONTEXT
In the United Kingdom, at the date of examination and to our best
2. OBJECTIVES • The Company does not make or purport to make, and hereby knowledge, this Overview Document is not a financial promotion, as
disclaims, any representation, warranty or undertaking in any form COTI has been advised that COTI coins are not a specified investment
3. COTI ECOSYSTEM
whatsoever to any entity or person, including any representation, to which the Financial Services and Markets Act (FSMA) 2000, as
4. APPLICATIONS & SERVICES warranty or undertaking in relation to the accuracy and completeness amended, applies. Accordingly, the provisions of the FSMA (Financial
5. REGULATORY APPROACH of any of the information set out in the Available Information. Promotion Order 2005), as amended, do not apply to the marketing
of COTI coins in the United Kingdom, and this document may be
6. TEAM
• You should carefully consider and evaluate each of the risk factors distributed to any person in the United Kingdom without breaching
7. ROADMAP and all other information contained in the Terms before deciding to the General Prohibition in FSMA. COTI coin holders do not benefit
participate in the Token Sale. from any depositor or investor protection regimes, such as the FSCS in
8. RISK FACTORS
the UK, nor any recourse to any financial dispute services, such as the
• COTI coins are not intended to constitute securities in any jurisdiction. Financial Ombudsman Service in the UK.
This Overview Document does not constitute a prospectus or offering
document and is not an offer to sell, nor the solicitation of an offer • Notice to prospective Australian subscribers:
to buy, any investment, security or financial instrument in any Under Australian law, as of the date of examination and to our best
jurisdiction. COTI coins should not be acquired for speculative or knowledge, COTI coins do not constitute a Managed Investment
investment purposes with the expectation of making an investment Scheme under section 9, nor a derivative under section 761D of the
return. COTI coins may be impacted by regulatory action, including Corporations Act, nor do they qualify as a share as that concept is
potential restrictions on the ownership, use, or possession of such understood in Australia. COTI coins are not any other type of financial
coins. Regulators or other competent authorities may demand that product under the Corporations Act, and the COTI network does
COTI revise the mechanics and functionality of COTI coins to comply not constitute a non-cash payment facility. Therefore, none of the
with regulatory requirements or other governmental or business offerings, interests, or any constituent material relating to the COTI
obligations in the future. coins, have been reviewed, qualified or approved by the Australian

Securities and Investment Commission or any other government or
regulatory body in Australia, nor is there any intention to do so.
• Notice to prospective Gibraltar subscribers:

At the date of examination and to our best knowledge, the COTI coins
are not a regulated product, nor is the act of distributing or marketing PLEASE REFER TO THE FULL VERSION OF “LEGAL CONSIDERATIONS,
them within Gibraltar a regulated activity in Gibraltar. The Gibraltar RISKS AND DISCLAIMERS” PUBLISHED ON WWW.COTI.IO TO EDUCATE
government announced in May 2017 that it is making amendments YOURSELF REGARDING FURTHER LEGAL DISCLAIMERS WHICH
to regulations under the Financial Services (Investment and Fiduciary GOVERN THIS DOCUMENT.
Services) Act 1989, with a proposed operative date no later than 1
January, 2018. Proposed transitional arrangements will permit firms
1. CONTEXT
that apply to the Gibraltar Financial Services Commission (GFSC) in
2. OBJECTIVES the first three months from the operative date to continue providing
Distributed Ledger Technology (DLT) activities until their application
3. COTI ECOSYSTEM
is processed. COTI intends to apply for DLT business regulation within
4. APPLICATIONS & SERVICES the required time frame.
• Notice to persons in the People’s Republic of China:
6. TEAM
On 4 September, 2017, the People’s Bank of China along with six other
7. ROADMAP ministries of the People’s Republic of China (PRC), (the Cyberspace
Administration of China, the Ministry of Industry and Information
8. RISK FACTORS
Technology, the State Administration for Industry and Commerce, the
China Banking Regulatory Commission, the China Securities Regulatory
Commission and the China Insurance Regulatory Commission)
announced that initial coin offerings (ICOs) and other forms of
digital currency financing are prohibited in the PRC. Accordingly, the
distribution of this Overview Document in or into the PRC is restricted
and no invitation is made by this Overview Document or the
information contained herein to enter into, or to offer to enter into,
any agreement to purchase, acquire, dispose of, subscribe for or any
other dealing in COTI coins, other securities, or structured products
in the PRC. This Overview Document is being communicated only to
persons outside the PRC and has not been reviewed by any regulatory
authority therein.

COTI Overview Document

Uploaded by

Copyright:

Available Formats

COTI Overview Document

Uploaded by

Document Information

Original Description:

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

COTI Overview Document

Uploaded by

Copyright:

Available Formats

Overview Document

3.1 Introduction to the Cluster 12

3.2 Trust Scoring Mechanism 14

3.3 Mediation System 16

3.4 Native Currency 19

3.5 Currency Exchange 20

3.6 Decentralised Governance 22

4. Applications & Services 23

4.1 For Consumers 23

4.2 For Merchants 25

4.3 For Mediators 27

4..4 For External Projects 27

8. Risk Factors & Legal Disclaimers 37

COTI Overview Document 4

3. COTI ECOSYSTEM Rather than placing their trust in third party

Blockchain-based payment systems, including Bitcoin and its peers, are

• Complexity. For typical consumers, the processes involved in acquiring

4. APPLICATIONS & SERVICES

To develop a distributed ledger-based payment system that provides a

COTI Overview Document 8

Governance • Centralised • Decentralised • Decentralised • 3.6: Decentralised Governance

• ~65,000 TPS* • ~20 TPS • 10,000+ TPS

2. OBJECTIVES • Low, particularly in cross- • High, irrespective of

• Complicated for most • Easy for buyers and

COTI Overview Document 9

COTI Overview Document 10

COTI Overview Document 11

COTI Overview Document 12

3.5 Currency Exchange

3.6 Decentralised Governance

4. APPLICATIONS & SERVICES

While the reputation systems within online marketplaces address this

3.5 Currency Exchange

COTI Overview Document 14

COTI Overview Document 15

COTI Overview Document 16

COTI’s approach to mediation involves harnessing a decentralised and

COTI Overview Document 17

3.1 Introduction to the Cluster

COTI Overview Document 18

The main functions of the exchange are three-fold.

3.5 Currency Exchange

5. REGULATORY APPROACH Seamless interoperability

COTI Overview Document 20

3.1 Introduction to the Cluster

3.2 Trust Scoring

3.3 Mediation System

3.4 Native Currency

3.5 Currency Exchange

3.6 Decentralised Governance

4. APPLICATIONS & SERVICES

COTI Overview Document 21

3.6 Decentralised Governance •••

4. APPLICATIONS & SERVICES

COTI Overview Document 22

4.1 For Consumers

• Nearby wallet-to-wallet transactions. COTI wallet holders will be able

COTI Overview Document 23

4.3 For Mediators •••