This technical document describes the Coinet Financing Platform (CFP), which specifies how the funds collected will be used in its associated (ICO) and a description of the opportunities and business model of the Cot Coin token issuance. The Coinet Financing Platform (CFP) allows a group with a technological innovation proposal to raise the necessary funds to start their project and also to start an own ICO associated with it. The initial offer of COINET coins will help finance the development and debugging costs of the project, as well as support the marketing and launch costs of the app in the iOS and Android stores. In 2016, 271 startups with value proposals aimed at consumers or SMEs with poor or no access to financial services were identified in Latin America. These companies are distributed into 10 large segments, with loans standing out, corresponding to 27% of the identified startups. Access to credit, and in general to alternative financing mechanisms, acquire greater relevance since it is a latent need of the technological development sector, which has been commonly relegated by traditional financial institutions . After the success of the platforms based on blockchain, more and more services are added to the use of this technology in order to offer the user a financing service with decentralization, automation and transparency as added values. At COINET we work to bring to the community a platform that facilitates access to blockchain technology and cryptocurrencies. Thus, thanks to the blockchain technology, the Coinet Financing Platform rewards the investor for contributing their money effectively and safely in a technological project in the phase before the ICO. In addition Coinet provides the necessary support for the proper execution of the financing process of the technology project and the proper use of the resources assigned to it, all this through a cryptocurrency which we have called Cot Coin that works in the decentralized platform of the Stellar network. The Cot Coin cryptocurrency can be used by the investor as a compound interest resource that allows him to obtain new benefits in other investments, which will allow him to increase his capital quickly. Cot Coin may also be used outside the COINET system, as a cryptocurrency to be used to exchange for goods or services on the Internet.
Financial institutions or traditional lenders require borrowers an asset that works as collateral for the loan. In the worst case, when the borrower fails to comply with the cancellation of the loan, the lender must liquidate said asset to recover the borrowed money. That is, if the borrower does not have an asset to guarantee the loan, the agreement can not be made. In projects of technological development without own financing the assets do not exist until a product is not taken to market. This restricts the ability to start entrepreneurs with a viable idea. Crowdfunding has been established as a common practice on the Internet to obtain funds. Companies like Indiegogo and GoFundMe handle the fundraising processes of thousands of projects. According to E & Y, the total amount of funds raised on ICO exceeded $3.7 billion and outperformed venture investment twice. The total amount of funds raised on ICO is approaching $4 billion, which is twice the amount of venture capital invested in blockchain start-ups (this includes $0.5 billion, which Beijing demanded to return to investors, introducing a ban on ICO). According to the Global Crowdfunding Market report, it is expected that the crowdfunding market will grow with 26.87% CAGR in the period of 2016-2020. It is estimated that in 2015, worldwide, more than 34 billion dollars were collected in this way. In this collection model, the generation of guarantees is carried out in an opaque manner on completely centralized platforms, which demand a commission for their use and prior confidence in the functioning of the collection and granting system and in the due behavior of their participating actors.
Solution Proposed by Coinet
With the arrival of blockchain and similar consensus protocols of transactions in distributed systems, the opportunity arises to make these practices more transparent, faster, safer and with greater scope. The fact that a blockchain is a decentralized network allows the entrepreneur to transparently offer his proposal to the investor community. Because of this, blockchain has become one of the booming technologies in recent years. Blockchain provides tools for registering and executing transactions that favor a decentralized economy among people, without the need for opaque intermediaries. Blockchain allows the creation of platforms where there is no need for prior trust between the participants of the transactions to honor their commitments. The ICOs (Initial Coin Offerings) are an innovative means of financing that allows obtaining funds for the development of technological tools, however, the creation of an initial offer of currency leads to an investment of time and money that is beyond the scope of many entrepreneurs. Peer-to-peer (P2P) loans are a new method of debt financing that allows people to borrow and lend money without the participation of an intermediary financial institution. Taking advantage of blockchain technology, P2P platforms securely connect borrowers with investors faster and cheaper than any bank .
According to ICO Box, about 80% of investments in start-ups were made by large investors in the third quarter of 2017 (Chinese private investment companies, hedge funds and venture companies specializing in cryptocurrencies). The rest were retail investors. At the same time, the crypto market will also show high growth rates: Infoholic Research LLP predicts that the market of cryptocurrency and Blockchain technologies will grow by 35.2% in the next 5 years. At Coinet we understand the value of innovative technological proposals with innovative and solid vision and we want to help them to materialize avoiding that the cost of carrying out an ICO is an impediment to its execution. According to the team’s analysis, more than $34 billion was raised with the help of crowdfunding for innovative projects in 2015. In our model, the borrowers only need to present a project with good potential, we through the Coinet Financing Platform (CFP), monetize that project and give it merchantable value by transforming it into an active blockchain. The Coinet lending platform mitigates the risk of non-payment, providing the ability to lend securely against blockchain assets. After evaluating and accepting a project, a multidisciplinary team is responsible for shaping and executing it, verifying the benefits of the proposed project before the investors, in this way the blockchain asset obtains value and guarantees the payment of the loan and its interests.
Platform evaluation where the token will be created.
White Paper Creation.
Creation of Token and Smart Contract
Development of ICO marketing and promotion plan
Negotiations to be listed in major exchanges.
Development of marketing plan and promotion of potential projects.
COT Coin listed on Stellar Dex.
Development of recruitment process and training of new personnel.
Assesment of potential projects.
Development of marketing plan and platform promotion.
Presentation of CFP graphical interface.
Beta release of Coin Financing Platform
Presentation of 5 projects to be financed.
Office Opening in the USA.
Start of development for mobile phones
Platform presententation for mobile phones.
First DAICOS of projects created in the CFP platform.