COTI - Status Report

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COTI

6 min readMar 26, 2020

Dear COTI community,

We follow the market and news like everyone else and it is now clear the COVID-19 virus will have a significant negative impact on businesses, economies and society as a whole over the coming months. In the payments world, we have seen giants of the space — VISA, Mastercard and PayPal — all issue warnings about a predicted decline in their businesses during this crisis time and the recession or even depression that may follow.

While this status report will deal with COTI’s business operations, our entire team would like to communicate our thoughts and best wishes to all of our community members and their families during these trying times.

In this status report, we’ll cover:

The status of our operation and network through a global pandemic
How we’re securing our runway
Our Roadmap and what we’re building over the coming months

The status of COTI’s operations and network

Maintaining our operations through a global pandemic

From a business perspective, COTI is in a somewhat unique position, as being a technology based business, we can continue to operate at almost maximum capacity by moving our workforce to remote access. In fact, with the COVID-19 lockdown now active in Israel, we have already done exactly that and it is now business as usual, at least as much as it can be, in the midst of a global pandemic.

Our processing volume is based on online merchants and will continue to grow

A majority of our merchants are online merchants and as such, their businesses and processing revenue have declined less as compared to many traditional businesses over the past month, as effects from the COVID-19 start to impact industry across the world. These same businesses are in an advantageous position compared to traditional business, as many consumers and businesses now turn to online purchasing, processing and entertainment to keep themselves occupied or operating while not being able to leave their homes.

These merchants pay their fees as a percentage of the overall transactions they continue to process on the COTI network, denoted in FIAT and paid with COTI.

This means two important things:

COTI’s revenue is more sustainable and resilient compared to traditional businesses
Merchants now need to buy more COTI to pay the same FIAT fees.

As we continue to onboard new merchants that were in our pipeline before the pandemic, we foresee that our network will continue to grow, even in these challenging times.

Securing our runway

COTI was rapidly growing before COVID-19 and we had already secured our runway via our various revenue streams for at least the next 12 months. However with projections of a global recession as a result of COVID-19 that could last for 18–24 months, our priority over the past two weeks has been to secure COTI’s runway even further into the future, making sure that whatever the circumstance, COTI can continue to operate.

As such, we are happy to announce that we have secured a $3.5M USD follow up investment in COTI from a group of our existing investors.

Being able to secure funds and runway during a time of crisis is a sign of strength and we are grateful to have an opportunity that not all businesses get during these troubled times.

This investment will allow COTI to operate at full capacity, to continue our growth and leverage new opportunities regardless of global market conditions.

The investors will buy tokens both from COTI’s treasury and from the open market.

180M tokens will be bought from COTI’s treasury for $2.5M USD. These tokens will be bought at a premium to market price to the day of agreement (March 18th), demonstrating trust in the future of the COTI coin.

Another $1M USD, completing the $3.5M USD investment, will be used to buy coins from the open market, effective immediately and for a period of no longer than 6 months.

While the $2.5M USD capital injection will be used to fund COTI’s operations, a large portion, 47M out of the 180M tokens is contributed from the team’s future compensation allocation. The team has made this sacrifice to facilitate this deal and to further prove commitment to the company’s goals. The remaining 133M tokens will be sold from the Incentive allocation.

We have not taken this decision lightly, as one of the inevitable outcomes of it is immediately increasing the circulating supply we presented in January. After careful consideration and long conversations with the investors, we are sure that they are as committed as the team to our goals and are long term holders.

In fact, they have allowed us to make their wallet address public. We’ll publish this address via our Telegram ANN channel soon after this announcement.

It’s important to note that their financial commitment of paying premium to the market price and, of course, the immediate injection of $1M USD demand to the open market, speaks louder than words.

Roadmap — what’s to come

Our staking 2.0 model ready for release

Our new staking model allows for a much higher staking volume, which enables many more users to participate in the staking program. If you were on one of our waiting lists, you’ll be able to stake soon. If you’re currently staking, you’ll soon be able to stake a much more substantial amount.

With staking 2.0, we have revamped some of our technology stack to support the new model, specifically, we have upgraded our Transaction Distribution Model, the algorithm that selects which node to use for a transaction. This means that this algorithm will now prefer nodes with higher staking volumes, as an addition to the parameters it currently uses (like trust score, fees and more).

Of course, we’ll also be introducing an exchange based staking model as part of staking 2.0 and we expect this new staking model to lock up a much more substantial amount of our supply than the previous model.

The model is now circulating between trusted partners for their feedback and we expect to present it in the first week of April.

Our tech roadmap has undergone a long awaited update and is ready to release

Our ability to process credit cards and crypto with instant settlement has created multiple opportunities with merchants that would be beneficial to the COTI ecosystem as a whole, from token holders, to merchants to the company itself, opportunities like the recently announced Blockchain Dollars and MyFirstWallet merchant case studies.

We’ll be releasing our updated tech road map next week and that will expand upon these merchant opportunities and give COTI the ability to remain reactive during uncertain times.

Continued new listing opportunities for COTI

While we can’t top the Binance listing in terms of volume, new listing opportunities will address certain niches or geographical locations. We obviously won’t be giving dates — but Binance wasn’t our last listing this year.

Last thoughts

In these trying times, we thank all of our community for their continued support and again communicate our thoughts and well wishes to our community and their friends and families.

Our operations continue as strong as ever during challenging times for our world.

Our roadmap is set to leverage growth opportunities and to continue to release groundbreaking technologies.

As with every crisis, there will be opportunities and winners coming out of it. We want to make certain that COTI and our community are those winners.