Shahaf Bar-Geffen, CEO of COTI, explains his company’s approach to blockchain decentralized finance, in an interview:
How would you describe the main pillars of the product?
COTI is a fully encompassing “Finance on the blockchain” ecosystem, designed specifically to meet the challenges of centralized finance (fees, latency, global inclusion, and risk) by introducing a new type of DAG-based protocol and infrastructure that is scalable, fast, private, inclusive, low cost and is optimized for finance. We have also introduced the MultiDAG structure, allowing the issuance of tokens on top of a DAG base structure, like no one else, has ever managed to achieve. The Trustchain protocol also includes a Proof of Trust Consensus Algorithm, a Global Trust System, a Universal Payment Solution, a Payment Gateway as well as consumer and merchant applications.
We are already generating pacing to process more than $250M for merchants in 2021, driving real adoption of cryptocurrencies and supporting ourselves without fundraising. All fees on our network are paid with $COTI and all transactions generate fees for $COTI stakers and Node operators, driving constant organic demand for $COTI and making our staking program one of the most popular in the space.
We have built a subsidiary, Paywize, which enables us to target a host of merchants via direct credit card processing that would otherwise not be possible via crypto alone. Paywize itself has grown tremendously in its first year of inception and has become a payment processor serving over 100 merchants globally.
We have been able to target and sign in a host of merchants, mainly in the gaming industry, including Market Junction, Dafabet, Kindred Group, 10bet, Unibet, SoftGaming, NetBet, BetWarrior, Entertainment Art, and more.
We have strong partners such as Cardano, Chainlink, Celsius, Dafabet, and Simplex and are supported by top names like Recruit (Japan’s biggest internet conglomerate) and Greg Kidd (of Coinbase, Ripple, Square, and more).
Our philosophy is to build most of the value chain, from infrastructure to wallets and fiat gateways. Hence, we have been building a lot of products such as COTI Pay VIPER wallet, COTI-X, Blockchain Dollars, Ultra Wallet, and more. Down the road in 2021 we’ll be releasing more products, including bank accounts and debit cards issued with VISA and Simplex, integration to Ledger, a product with Cardano, and some more surprises.
Last but not least, we have been developing a Defi product: the Crypto Volatility Index (CVI), which is a market fear index for the crypto space (like VIX, for crypto). Coupled with it is a Defi trading platform, allowing users to hedge themselves against market volatility and impermanent loss.
Tell me about your team
We are experienced builders. The R&D team, led by Dr. Nir Haloani, COTI’s CTO and a former IBM head of research, is filled with top talents from the top companies in the world and cryptographers from Elite Intelligence Units. Our executive team is also extremely experienced and is all well accomplished. As for myself, I’m a third-time entrepreneur: I have built and sold two companies, WEB3, and Positive Mobile, so I’m not new to the game. This is the reason why people like Greg Kidd (Ripple, Coinbase, Square), Steven Heilbron (Investec Bank’s former CEO), and Dr. Matt McBradey (Blackrock’s CIO) have been backing us.
We have been working together as a team for almost four years now, so we are very productive together and manage to build great products at a rapid pace.
Tell us more about your Defi product: Crypto Volatility Index. How did you come up with this product and how do COTI as a company and CVI as a project relate to each other?
We have created and released CVI and $GOVI to bring the very popular Market Fear Index from traditional markets to the crypto space.
The Market Fear Index for traditional markets (VIX) is huge. In fact, the daily trading volume of VIX ETFs and Futures combined has grown exponentially to Billions USD in daily trades in the last 16 years, as demonstrated in the chart below:
It is only reasonable to assume that the Market Fear Index for Crypto (CVI) is just as necessary, as Crypto volatility is much higher than S&P 500 volatility.
We have created CVI as a decentralized index and permissionless trading platform so that anybody can use it and either trade crypto market volatility directly, or use it as a hedge in a wider crypto portfolio.
The CVI brings a new set of tools to the DeFi space. Users can:
Buy a position in the index if they believe volatility in crypto is about to grow, as a speculation or as a hedge for their portfolio
Become a platform liquidity provider to earn fees whether they feel that volatility will decrease or remain the same.
Protect their position as liquidity providers on DEXs like Uniswap against impermanent loss (caused by major fluctuations in assets price, regardless of the direction)
Earn $GOVI on all of the above
CVI is an open-source code and available on Github. Our intent with open-sourcing CVI is for further trading instruments to be built upon the CVI index by the crypto community.
The $GOVI token is the governance token for the CVI platform and users who stake the $GOVI token on the platform will share in the platform’s fees.
$GOVI will also be the governance token for further development and tools we create for DeFi, whether it be new indexes or trading instruments.
$GOVI is a fair launch: no pre-mining, no investors, no cost.
The more people use CVI, the greater the income to $GOVI holders.
The more you use the platform, the more $GOVI you’ll get, as we will be distributing additional $GOVI tokens over time to users who supply liquidity on the CVI platform.
We believe that the potential of CVI and $GOVI is huge.
Our team developed CVI. However, the code, the formulas, the adaptors, the oracles, and everything else are available on Github in a fully transparent manner. $GOVI holders can shape the future of the platform with their votes. Hence, it is a fully decentralized platform with a DAO mechanism to govern it.
Can you tell us about the partners that you are working with?
We have built important partnerships in both the crypto space and the traditional world. We partnered with Cardano, developing the ‘pay with ADA’ gateway and with Chainlink to build an Oracle to calculate the Crypto Volatility Index and to stream its date. Other important partnerships include Recruit; a major global enterprise with a market cap of over $50 billion, Celsius Network, which will support the COTI Earn functionality in the COTI Pay wallet to allow consumers and merchants to easily earn interest and access loans directly on the COTI platform. We have partnered with Simplex and MoonPay, allowing COTI to join top currencies like BTC and ETH in the ability to be purchased directly with a card or bank transfer. Top exchanges and platforms like Binance, Kucoin, Changelly, and ChangeNOW have adopted the solution and their user base can now buy COTI directly with fiat.
Do you have any development plans you can tell us about?
We do. A lot. We released both COTI’s and CVI’s roadmaps earlier this year, which include all of our upcoming milestones for the next 6 months, such as debit card and bank account, several licenses, adaPay on MainNet, Celsius integration, and more.
What’s the value of COTI in comparison with other similar projects?
COTI’s Universal Payment System (UPS) provides a comprehensive payment solution that combines all existing support systems of traditional payment processors with the added value of digital assets. A merchant would prefer COTI Pay to his traditional solution because COTI gives him everything that he gets with his previous solution (like credit card processing) but adds some very important benefits like INSTANT payment, low transaction fees (sometimes up to 90% cheaper), Defi based Savings account and global access to the underbanked.
When compared to a crypto processing solution, like BitPay, we offer a complete solution to credit card processing, which represents the vast majority of the merchants’ business as well as access to loans and savings. We are the only true universal all-encompassing solution out there.
How are you aiming to provide scalability to your service?
To overcome the speed challenge, COTI has developed a new approach to achieving consensus between transacting parties operating on a DAG-based data structure. The Cluster achieves scalability through its use of parallel source selections and transaction confirmations, as well as its use of trust scores in the COTI network, already clocking more than 10K TPS.
What makes COTI different from other crypto projects?
COTI is a revenue-generating company, a blockchain-based Fintech solution in payment processing. We utilize a proprietary protocol we have built and a cryptocurrency infrastructure to improve how payments are done globally. On the COTI network, all transactions are carried out using $COTI to pay fees for services rendered to merchants. The growth of volume on the Trustchain directly benefits the stakers and node operators of COTI by paying lucrative rewards.
At the end of the day, COTI will be the platform for anyone who wants a working fiat/credit cards/crypto payment solution as well as Defi products.
The other thing that we are very proud of is our community, which is one of the strongest in the space. Our community has managed to list us on Binance at no cost, make us one of the most popular coins on Twitter, and is a source of pride for us. We love our community.
What made your staking program so popular and how is it different from other staking programs?
COTI’s staking reward model is based on the merchant’s׳ transaction volume processed on the Trustchain, generating fees for node operators and stakers. Therefore, with an ever-growing merchant’s׳ transaction volume, the staking program can only grow with time.
COTI’s staking program is one of the most rewarding programs out there and the staking 3.0 program allows each participant to stake more COTI and earn more rewards. The following table summarizes the staking classes and guaranteed rewards of community nodes:
We are limiting the number of nodes to make it profitable for operators and stakers
There is a tremendous demand to stake COTI. We opened the staking 3.0 application on February 11th, and since then, over 350M COTI in demand to be staked!
What else can your technology be used for?
Essentially anything that required high speed and low transaction costs. Payments, of course, but also loyalty, IoT, Data storage and more.
One of the things that the space really needs right now is a reliable Layer two product that can connect and interoperate with Bitcoin and Ethereum in a cost-effective, secure and scalable manner. We are in a unique position to do just that and we are researching it.