Decentralized Remittance. & Payment Platform. Token Economy. Ver Crypto Paradox. The Impossible Trinity. RemD Exchange System

Transcription

1 Decentralized Remittance & Payment Platform Token Economy Ver Crypto Paradox The Impossible Trinity RemD Exchange System

2 Contents 01 Introduction 02 Remiit Token Economy : How to solve Crypto Paradox 03 The Impossible Trinity 04 Why the stable exchange rate? How will it operate? (1) The Separation of Tokens (2) Operation and Market Mechanism of REMD (3) Problems that arise in REMD Operation and the Solutions (4) Mechanism of Operating Self-Owned Exchange (5) Market Making Mining 09 Market Stablization and Governance Issue of Stabilizing the value of REMI and granting additional value Index and Price Range 14 Issue of Incentive to use REMD 15 Conclusion

3 Intro duction Introduction As of July 6, 2018, the market capitalization of the top three cryptocurrencies (Bitcoin, Etherium and Ripple) amounts to approximately $180 Billion. This market size is less than the $2 trillion international exchange market size, however it was on a similar scale to that of New Zealand's GDP, ranked 53rd in the world on the World Bank's GDP Report in As such, we cannot deny that the cryptocurrencies have been growing rapidly from the Remiit Token Economy : How to solve Crypto Paradox second half of 2017 to early 2018, albeit with sharp fluctuations in prices. Despite this growth, most of the cryptocurrencies on the market so far have been disappointing in their explanation of the economic implications of the markets in which they operate and function. For example, except for the technical aspect that bitcoin is limited to 21 million coins and it can be divided into small units to many decimal points, there is no economical explanation in why the coins should be limited to the total number of coins issued. Of course, there are descriptions of those who advocate such a system, however there is only a limited amount of explanation from Satoshi Nakamoto, the creator or related organization of Bitcoin. Given that the cryptocurrencies are recognized by the SEC and the US courts as having the character of a security and in part the nature of the currency used for payment, not having enough explanations on how their cryptocurrency creates an economy becomes a problem. If they cannot adequately account for the economic mechanisms they serve as investment assets and, in part, for payments, this means that The Impossible Trinity they are not functioning properly in both characteristics. Therefore, we want to explain the token economy of REMI and REMD, the cryptocurrencies that are the core features in the REMIIT service. This allows us to better communicate our services and the functionality of our cryptocurrencies to investors, as well as to ensure smooth operation and confidence. 01

4 Remiit Token Economy As mentioned above, every cryptocurrency including the : How to solve function by acquiring the universality in its use from the Crypto Paradox REMIIT performs as a role as a payment and settlement participation of people. The acquiring of universality in use from the participation of people could cause dilemma in the essence of the cryptocurrency. Namely, stable price volatility is important because the role of cryptocurrencies are the payment and settlement functions. This phenomenon is similar with the behavior in the real economy that people consider the high price fluctuation as a negative signal and the stable price volatility as a positive signal in the foreign exchange market. In the 1997 Korean foreign currency crisis, for example, it happened that the value of Korean Won rapidly decrease to the restricted price range within a day. The sudden price fluctuation of the currency is a negative signal to the whole economy of one country. On the contrary with the real economy case, the price volatility of the cryptocurrency is amplified by the level of trading of the token after the token is listed on the exchange because for the future price expectation and speculation motive of market participants. This phenomenon could cause Introduction distortion of the use of cryptocurrencies as a means of payment and settlement vehicles which is a serious problem. Namely, a cryptocurrency that should have stable value and function equivalent to a normal currency is listed on exchanges for trading which is giving people the expectation that the future value will change, deteriorating the character of the cryptocurrency, hence not functioning properly. To solve the above-mentioned problem, we will issue the cryptocurrency as two separate units: one is the REMI and the other is REMD. First of all, all the tokens we supply to the market are issued as REMI. Remiit Token Economy : How to solve Crypto Paradox REMI is a token listed and traded on the normal cryptocurrency exchanges. The main function of REMI is to convert it to REMD. REMD is the very core of our blockchain mechanism where market participants could perform the overseas remittance. In other words, the market participants who send money from one country to other must acquire REMD from REMI by using the change algorithm. In order to make this exchange process work smoothly, we are trying to provide a predetermined percentage of REMI as an incentive for reward systems in a mining concept to market participants who exchange REMI for REMD. Discussions on the specific trading mechanism and value stability of REMD and REMI will continue in the following sections. The Impossible Trinity 02

5 Free capital flow 1 Choice Choice Fixed exchange rate 3 2Choice Sovereign capital policy *The I mpossible Tr init y* The Impossible Trinity In the study of international economics, the theorem which is an important implicathe Impossible Trinity tion of the Mundell-Fleming model, which considers an international trade to the IS-LM model explains that in the Small Open Economy, the three types of goals in the monetary policy such as the stabilization of the exchange rate, independence of monetary policy and liberalization of capital movement cannot be achieved at the same time and one of the three must be abandoned. If a certain economy wants a stable exchange rate, it should choose a fixed exchange rate. If such a fixed exchange rate is chosen, the central bank must abandon its independence from the monetary policy since it cannot implement an autonomous monetary policy to adjust for its monetary policy. If the simultaneous pursuit of a stable exchange rate and independence of the Why the stable exchange rate? monetary policy is required, the economy should abandon liberalization of capital movement because it is impossible for foreign capital to freely move along with changes in economic conditions and to change the exchange rate autonomously in the process. Lastly, if the economy pursue the independence of monetary policy and liberalization of capital movement, the economy should abandon the stability of the exchange rate. Thus, the stability of the exchange rate, the independence of monetary policy, and the liberalization of capital movement cannot be pursued at the same time. This could also apply in the same way to cryptocurrencies. It could be said that the cryptocurrency plays a role which is equivalent to the foreign exchange (FX) in the economic system that plays the payment and settlement role which is restricted relative to the fiat currency. Therefore, cryptocurrencies cannot disregard but follow How will it operate? the Impossible Trinity Theorem. We also have to give up one of these three features as a cryptocurrency. If we have to give up one of the three things: stability of the exchange rate, independence of the monetary policy, and liberalization of the capital movement, we must give up the stability of the exchange rate, in other words, we must give up the fixed exchange value. 03

6 Why? the stable exchange rate As a cryptocurrency used for transfer and payment, REMI and REMD can be regarded as foreign currency-equivalent blockchain token in that they are exchanged for fiat currency. Foreign exchange is subject to the Impossible Trinity Theorem as described above. Among those three, we want to pursue independence of monetary policy and liberalization of capital movement, instead abandoning the stability of the exchange rate. As a cryptocurrency exchanged with fiat currency and used for remittance and payment, REMI and REMD require freedom in the movement of capital. If we seek the liberalization of capital movement, we must give up the independence of monetary policy (i.e self-regulation of currency issuance and volume) or the stability of the exchange rate (exchange rate pegged to fiat currency). The independence of monetary policy cannot be abandoned because it implies that we can control the volume of cryptocurrencies as the issuer and distributor. Therefore, we give up the stability of the exchange rate. Abandonment of exchange rate stability implies allowing price volatility of our cryptocurrencies (even though it may be raised to a fairly high level), but this inversely affects the volatility of our cryptocurrencies. This means that it can be controlled through liberalization of capital movement and regulation of volume and Why the stable exchange rate? volume of distribution. In addition, we want to set the lower limit for stabilizing the REMD value. Under normal circumstances, REMI will be exchanged for REMD, but if the market is in panic situation, the price of REMD may drop. Even in this situation, we will exchange REMD conditionally with REMI as much as the agreed value in order to guarantee the value of REMD above a certain level. This is a "commitment" with market participants that we will strive to stabilize the value of REMD. How will it operate? How? will it operate (1) The Separation of Tokens As mentioned above, existing tokens have both characteristics as an investment asset and as a currency. To solve the problem, we will operate our token mechanism as two separate units: one is REMI which is listed on the existing exchanges and is possible to trade with other crypto and fiat currencies and has the utility function to convert it to REMD where REMD is a means of overseas remittance and payment settlement. REMD is a token traded by market participants and a means of trading associated with the core of our remittance system, REMIIT Smart Contract (RSC). The 04

7 specific transaction mechanism of REMD is discussed in a separate section. REMI is a blockchain token that has a utility function when market participants try to acquire REMD by using transforming algorithm. However, REMI is used only to convert into REMD, but not for the RSC network. We also want to attract active conversions from REMI to REMD by imposing incentives with a concept of mining in the transition. (2) Operation and Market Mechanism of REMD The token economy we pursue is divided into REMI and REMD. REMI is listed on an external exchange and traded with other cryptocurrencies and is responsible for converting into REMD by using the transform algorithm. Market participants, including the linker, must purchase REMI and convert it to REMD to perform the overseas remittance and payment transactions using REMD. REMD is a token used for overseas remittance and payment transactions, and could only be acquired and initiated through a conversion using REMI. In addition, to give an incentive to market participants to change REMI to REMD, we will provide an immediate transform from REMI to REMD and an incentive of the predeterwhy the stable exchange rate? mined percentage of REMI. Conversely, it takes additional time to exchange from REMD to REMI. This imposes an incentive for market participants with trading purposes to hold REMDs. REMD has a strong character as a payment instrument that mediates transactions on the RSC. The trading mechanism of REMD is as follows: For example, let's assume a migrant worker who works in South Korea desires to send their earnings back to their family. The migrant worker who wishes to transfer money will send KRW to the local (Korea) How will it operate? Linker(e.g MTO, Financial Institution, Payment Provider, etc.), and the local Linker will exchange the KRW to REMD and send it to the Linker of the receiving country. The family members receive a specific code from South Korea, then receives local currency from their Linker who converts it from REMD into their local currency. The advantages of this process compared to the current SWIFT system are as follows: First, the commission charged through the five-tier institution (Sending Bank > FX > Intermediary Bank > FX > Receiving Bank) has decreased, and the transaction process has also become more concise. This can save the considerably high transaction fees from SWIFT. This is a social welfare that can improve and the transaction cost that can be reduced on our system. 05

8 << Increased Demand for REMD Linker KRW USER REMD REMD REX ETH RSC REMD Linker Need to sell for REMD >> EUR USER Why the stable exchange rate? (3) Problems that arise in REMD Operation and the Solutions In the transaction process using REMD, the Linker of the sending country has a problem that the REMD is continuously reduced, and the Linker of the receiving country has a problem that the REMD is continuously accumulated. There are two ways to approach this problem. First, the lending and borrowing of REMD between Linkers. How will it operate? Second, let REMD be traded on the exchange. The first method is the borrowing and lending between Linkers through REMD. This method is that it can solve the cashflow shortage problem right away, however the problem occurs where the sender has to buy REMD using the fiat currency or another cryptocurrency again from the market to repay the REMD loaned. The second way is that REMD is used like an exchange token. In other words, exchange REMD with another cryptocurrency (i.e Bitcoin or Ethereum) in the internal exchange. As mentioned above, if the exchange of REMD to fiat currency is done through the Linkers or DEX, then there is inevitably a problem that the existing overseas remittance procedure (in this case, the use of SWIFT network) is involved. This can be resolved making it possible to exchange between other cryptocurrencies. Of course, the problem that arises in this case is that REMD is linked to a currency which serves as a key currency in a cryptocurrency environment such as Bitcoin or Ethereum. However, even in the real economy, the currency value of the Small Open Economy is linked to the dollar, meaning that it is not a huge problem that is inevitable. Rather, the problem is maintaining the stability of REMD which is traded with the cryptocurrencies as well as the fiat currency. In addition, we can consider one more problem. Considering that the characteristics of REMD is used as a means of overseas 06

9 remittance causing it to be inevitably linked to fiat currencies such as Korean Won, Thai Baht and Vietnamese Dong. The question is how to represent these different currencies and the price valuation of REMD. In other words, REMD not only has to consider the exchange rate with the fiat currency but also has to consider the exchange rate with other cryptocurrencies. If this exchange rate is not set fairly, arbitrage trading incentives arise. For example, consider the following case. If one REMD is exchanged with 1,000 KRW and one ETH is exchanged with 2,000 KRW, then one REMD should be exchanged for 0.5 ETH. This is because The Law of One Price is maintained and arbitrage opportunities are lost. If these exchange rates are not maintained, market participants can redeem REMD without risking them by buying them in undervalued markets and selling them to overvalued markets and leave with a profit. In fact, the divergence of these prices occur frequently in the actual foreign exchange market, so market participants who can take advantage of this opportunity can generate profits and maintain price equilibrium in the market, it is a normal discovery process. Finally, in the early stage when the market is not well-established for smooth exchanges between REMD with other cryptocurrencies in this market, REMIIT hopes to participate in this market as a Market Maker or Liquidity Provider. Why the stable exchange rate? (4) Mechanism of Operating Self-Owned Exchange The operation mechanism of the self-owned exchange is basically an order book transaction considering the characteristics of REMI that is listed and traded on an external exchange and REMD traded on the internal exchange and DEX, we will mainly How will it operate? apply the market order book method. Thus, the exchange rate between the REMD traded on the internal exchange and the other cryptocurrencies go by the dual process as follows: First, exchange rates between REMI and other cryptocurrencies are determined in the external exchanges. The price of REMI, however, is decided with the predetermined exchange rate with REMD by using the index which is decided by using the exchange rate between REMD and fiat currencies of other countries and REMI with other fiat currencies and cryptocurrencies which are traded in the external exchanges. Therefore, the price of REMD traded on the internal exchange is affected by the exchange rate in the remittance process to the fiat currency of each country as well as the price of REMI traded on the external exchange. So it is told that the price of REMD could be determined exogenously in our market mechanism. Hence, the market participants who want to trade REMD quickly, he or she could use the market order that the transaction executed at the current market price, but the market participants who do not need fast execution of the order could use the limit order. On this exchange, MTOs can trade their own REMDs, which can help them overcome the overs and shorts. In other words, this market mechanism is basically the same as the order book transaction which is used in the stock market. That is, if the buyers and sellers present 07

10 the quantity of REMD they want to trade at the current market price, the system will enter into the transaction by matching the orders, and then the market maker intervenes to clear the quantity in excess and deficiency for market clearing. In this process, the problem might occur that the excess or deficient volume is not cleared because of the order imbalances. So, to solve this problem, it is possible to consider these two step problem solving processes: In the early period of the market, the independent foundation that is separate from REMIIT serves as a market maker to clear the excess and deficiency of orders. After the market has grown to a certain extent, MTOs could become market makers themselves and clear orders. In this clearing process, we could provide incentives which is similar with the mining. The specific mechanisms of the incentive is as follows. (5) Market Making Mining Constrained by specific conditions Why the stable exchange rate? REMI Long term convering Issuance mining REMD Index Exchange Rate How will it operate? EHTER USD Index Exchange Rate REX REX Local Fiat REX Local Fiat REMD BITCOIN CRYPTO REMI Market making mining **REX : REMIIT Decentralized Exchange 08

11 The most important part of the trading mechanism mentioned above is to ensure the buying and selling transactions are completed smoothly. The reason why this process is important is that because if the deal is not executed, all our intended purposes cannot be achieved. So we want to give the Linkers incentives to clear the deal. In general, transactions in the Order Book are made through Linkers acting as market makers that match the buy and sell orders. Therefore, we would like to give an incentive to Linkers such as a certain percentage of REMI from the cleared transactions amount. In this case, because there exists a risk that the Linkers will be concentrated only on transactions that are easy to clear in order to receive the incentive, we would pay incentive with cumulatively increasing amount whenever a certain amount of time (for example, one minute) has passed from our standard trading time. Through this process, we could make the Linkers play a role as the Market Maker to clear the market by adjusting their own amount, and this will play an important role in activating the market. Market Stabi li zatio n and G over nance (1) Formation of Trust in Market It is important that the value of the cryptocurrency is maintained through the community that the users have formed themselves. The formation of such a community is possible when trust is established between market participants and the Foundation. So the question is how to build trust in the market and how to determine the market governance. The process of Issue of Stabilizing the value of REMI and granting additional value establishing trust in the market could be broadly divided into two. The first is securing market stability through the above-mentioned cryptocurrency operation. This includes smooth distribution of the Two-Tier tokens and guaranteeing the minimum value of them. The seamless distribution of cryptocurrencies and the guarantee of minimum value are connected because the minimum value must be guaranteed so that people can buy and distribute cryptocurrency with ease. To this end, we will guarantee minimum exchange value for REMD. That is, if the price fluctuates rapidly in the market, we intervene in the market and stabilize the price, and when the price collapses, we could guarantee the minimum exchange amount for REMD - for example, 1 US dollar. What is needed for this is the crisis prevention system, the second factor that forms market trust. For the crisis prevention system, we will operate the reserve. The reserve, which we hold for a certain amount of total token issuance in order to stabilize the market, will be used when the rapid price fluctuation occurs in the 09

12 market and sustained for a certain period of time. This market stabilization mechanism operates with the same mechanism as the central bank uses to stabilize the foreign exchange market. In addition to the reserve, we will work together with Linkers creating a co-operative relationship with them who are active and have greater scale in trading volume. According to Diamond and Dybvig (1983), the occurrence of the Bank Run could be triggered by the distrust of depositors who do not believe the banks will return the deposits under the partial reserve requirement system. This is also true in cryptocurrency ecosystems. If the Foundation does not guarantee the value of the token above a certain amount, or if the token ecosystem is not functioning smoothly, then it is amplified and leads to the Bank Run and the market collapse of the Cryptocurrency market. Therefore, we will actively engage Linkers in our ecosystem to maintain the stable value of the token. We will also actively participate in the crisis, to ensure the minimum value of REMD working with the Linkers. What we provide to Linkers and users on this connection is the mining incentive. As mentioned above, we provide incentives for market makers to close deals if the transaction is not concluded for more than a certain period of time in REX. Priority is given to platform participating Linkers in which these incentives are provided. It is to guarantee a corresponding benefit to the Linkers who join with us to stabilize the market. In addition, the incentive provided in the process of converting REMI to REMD is also an active participator in the market and mechanisms to give additional incentives to businesses and individuals that hold larger amounts of REMI and REMD is also under consideration. Issue of Stabilizing the value of REMI and granting additional value (2) A Process for Stabilization of REMI and REMD The core of our ecosystem is the stability of values because the token is used for remittance and payment. Therefore, it is important to maintain stable value without abrupt price change. It is intuitive to understand that the value of money at the time of sending and receiving or at the time of ordering and receiving goods are different the currency not functioning properly. As we recognize the importance of value stabilization, we want to apply a mechanism that can keep the value of REMI and REMD stable. To stabilize the value, we would like to apply the staking method, which is not a simple conversion mechanism to convert REMI to REMD, but temporarily freezing the movement REMI and convert REMI to REMD at a corresponding value. In other words, the staking mechanism does not burn the REMI, but rather keeps it as a collateral, issuing the corresponding REMD 10

13 to the user. The reason for choosing this staking mechanism is because it can achieve the stability of value. Namely, in the case of the staking mechanism, as described above, since the movement of the REMI is suspended and the corresponding REMD is issued, the user can request to switch the REMD back to the REMI when confronted by the market movement unfavorable to them. We want to address these needs by using futures contracts. Futures contract is a contract to trade a financial instrument or commodities at a specified price at a certain point in the future. We apply this to the staking mechanism to grant the right to enter into a futures contract to switch the REMD back to REMI when required by the user in converting the REMI to REMD. This agreement allows the users to avoid the volatility of the REMD price and switch back to REMI in the REX by using the futures contract when the exchange rate fluctuates severely or moves unfavorably to them. This allows the user to avoid risks associated with sudden price changes in the market. Let's assume that a user has staked 100,000 REMIs at a 100:1 ratio to earn 1,000 REMDs. In this conversion, 1 REMD has a value of 1 USD. And the user has signed a futures contract that can convert 1 REMD to 100 REMI in case the REMD price drops sharply in the market. If the value of REMD falls sharply in the market assuming the value corresponding to 1 REMD falls to 50 REMI, if there is no futures contract in this situation, the user can only obtain 50,000 REMI although they exchanged 1,000 REMD. However, if the user had a futures contract described above, they can get 100,000 REMI that was initially converted. In other words, the user could re-acquire the REMI by applying a stable exchange rate despite the drop in the value of the REMD. This futures contract mechanism is a way to bring stability within our ecosystem, along with our index-based price stabilization policy, to prevent sudden price changes. Issue of Stabilizing the value of REMI and granting additional value Problems in Determining t h e Va l u e o f REMD The biggest problem with issuing and trading REMD is the proper value determination. In general, the value of the fiat currency is retained by the guarantee of the government, without any intrinsic value. On the other hand, the issue and use in cryptocurrencies is that there is no central bank to guarantee value, so to determine the proper value of the cryptocurrency is important. The South Korean cryptocurren11

14 cy market has taken a sudden turn from last fall to the early spring of this year, and the mentioning of "Kimchi Premium" relates to the problem of calculating proper value. The cryptocurrencies which have no face value explicitly could cause sharp up and down of prices when the herding behavior occurs because the purpose of investment is the future profit which is caused from the increase of the price (This means a situation in which the function as an investment asset and the function as the currency are in conflict as discussed above). When we compare the cryptocurrency to the currency of a real economy, the REMD would be linked to the situation of Bitcoin or Ethereum corresponding to the dollar or the euro. Moreover, considering the characteristics of REMD which is mainly used as a means of external remittance, REMD is linked to the fiat currency as well. Thus considering the characteristics of REMD, which are used as a key means of transferring money, REMD is also associated with the fiat currency. To calculate appropriate value, stabilize the value, and provide information to investors and market participants, we will use the index to calculate and report the price of REMD. In general, in the stock market, the index reports the movement of the stock price based on the price at a certain point in time so that the market participants understand how the overall price of the stock market is. In case of REMD, as it will be used as a means of overseas remittance, there are a variety of currencies such as Korean Won, Thai Baht, Vietnamese Dong, and Philippine Peso are subject to exchange. Thus it is important to report of the value of REMD to provide proper information to market participants. We want to use the US dollar as core in creating the REMD index. In other words, in the real economy, the currencies of each country are exchanged in US dollar with proper ratio. Using this, the exchange rate between REMD and each currency is derived using the exchange rate of each currency denominated in dollars. This allows us to provide market participants with the appropriate value of REMD by indexing the exchange rate between the REMD and the fiat currencies. We also want to report the exchange rate between REMD and other major cryptocurrencies (i.e Bitcoin or Ethereum). This is because exchange between Issue of Stabilizing the value of REMI and granting additional value REMD and major cryptocurrencies are used as a means of settlement of transactions between Linkers. The exchange rate between the REMD and major cryptocurrencies is to be determined in the context of being traded in the market after the initial issuance. Of course, in this case, the differences between the exchange rates in the real economy and the cryptocurrency can lead to the discovery of Triangle Arbitrage in the early stages of trading. The advantages of reporting prices to the market by using index are as follows: First, we can provide appropriate information to market participants. Namely, by reporting the exchange rates and transaction ratios that are separately reported between each individual country or individual country's local currency and other cryptocurrencies, it is possible to provide convenience of transactions by reducing the time and effort required for market participants to obtain price information. In other words, providing this transparency index can offer convenience by reducing the searching cost and transaction costs of market participants. Second, it is possible to derive to stabilize the price fluctuations based on the index. If we look at the exchange rate between each country's currency and REMD / 12

15 exchange rate between major cryptocurrencies and REMD without the index above mentioned, Linkers and other market participants have to complicated information handling process and it could be difficult to grasp the aggregate market volatility which synthesize the volatility of each corridor. On the other hand, through the indexing process described above, it is possible to conveniently acquire and analyze information on REMD as if people obtain information on the stock market through stock price index. Issue of Stabilizing the Value of REMI and granting additional value REMI is a cryptocurrency traded on an external exchange and serves as a standard for value in our ecosystem. It is also REMI's role to support the Issue of Stabilizing the value of REMI and granting additional value value of REMD when the price of REMD decrease sharply when the market is on panic as described in the above. Therefore, it is important for market participants to provide price stability and additional value to REMI. Therefore, if the REMD is actively traded in the market, we will compensate the holder of the REMI, when the price of the REMD decreases, we will buy the REMD in market as well as we will give an incentives as a predetermined amount of REMI to MTOs who convert REMD to REMI. Through this commitment, we can keep the value of REMI above a certain level, and effectively control it in a market panic situation, preventing Bank Runs from switching cryptocurrencies into fiat currency. It is believed that this promise is of significant value when we consider the fact that a large number of financial crises are attributable to Bank Runs, which is where investors feel uneasy about the value of their bank deposits. Index Index and Price Range and Price Range In determining the index, we want to use the same weighted market capital approach which is used in the stock market. The weighted market capital is calculated by multiplying the total number of issued shares of an individual company by the price per share to obtain the market capitalization of the company and adding the 13

16 market capitalization of all companies in the market. The weighted market capital is a measure of the total market capitalization, as described above, multiplied by a weight that reflects the portion of market capitalization of individual firms in the market. Likewise, we will use the weight of the remittance through each corridor in the entire remittance network using REMD to derive the index. Through this, we can derive an index that accurately reflects the remittance reality. There is no price fluctuation limit on transactions derived from this process. Under the current situation where all of the world's cryptocurrency exchanges are connected, if we set the price fluctuation limit in our DEX, market participants could trade in other exchange by bypassing our regulation. Issue of Incentive to use REMD The key to our token economy is that Linkers use REMD as a means of Index and Price Range overseas remittance. Currently, there are SWIFT systems and their own tests show that the cryptocurrency networks are not as efficient as SWIFT systems, but the reason for sending money using REMD is due to high remittance fees. Interbank overseas remittance systems using the current SWIFT network are charged a fairly high fee, which is particularly strong in remittances in small amounts. Considering the case of a migrant worker who is expected to be a major early client in launching stage of the service, the high fee which is imposed by current interbank international remittance system is a bigger problem because they send living expenses periodically to families living in developing countries. Thus, lowering these high commissions and reducing remittance dura- Issue of Incentive to use REMD tions that take days of current reference can be beneficial to both consumers and Linkers. Therefore, we want to induce migrant workers to use REMD based on low fees, fast remittance processes, and transparent processing. After securing the users with migrant workers, we will extend to general remittances and then eventually provide convenient and fast payment services in cooperation with payment providers and app-based service companies (i.e Airbnb etc.). This will provide fast and convenient remittance services to everyone who uses our platform at a low fee, and our platform itself will be a powerful incentive for our customers. Conclusion remiit.io info@remiit.io Telegram@remiit Twitter@remiit_ico copyright 2018 REMIIT All Rights Reserved 14

17 Index and Price Range Conclusion In the current circumstances that there already exist many cryptocurrencies in the market, one might ask why we want to present a new cryptocurrency and service that already exists in this industry. The answer is simple: We want to reduce transaction costs, increase transaction speed and social welfare not just a basic cryptocurrency. Economically, transaction Issue of Incentive to use REMD cost means the various costs involved in gathering information before the transaction and the negotiation phases, the costs required for the contract to comply, and the incompleteness of the contract when market participants trade certain goods or services. For international remittances and payment, the transaction cost includes the exchange costs, sending bank fees, receiving bank fees, and intermediate bank fees. We want to increase the social welfare of market participants who participate in this transaction by providing the REMIIT platform to our customers, using cryptocurrency mechanisms to reduce these transaction costs. The competition in the theoretical economics and the real economy almost always cause the increase in the welfare of consumer. Our participation in the international remittance and payment market, which is now mainly performed by banks, Conclusion will be able to promote the consumer welfare by stimulating the market by promoting the competition. This is the purpose for which we create and provide this service. 15