Blockchain for Change Whitepaper
BCC Whitepaper 1 Contents 1. Introduction 1 Blockchain for Change 1 2. Change Coin 1 3. The Problem 2 Verified Identity & the Traditional Financial System 2 The Current System: A Snapshot of the United States 2 4. The Solution 2 Identity on Blockchain 3 The Fummi Application 3 The Change Coin Ecosystem 4 Change Coin Community 4 Retention through Utility 4 Blockchain for Change Code of Ethics 4 User Growth and Acquisition 5 Change Protocol 5 Distribution Roadmap 6 5. Market Opportunity for Growth 6 Scope 6 Differentiation 7 Business Competitors 7 Commercial Banking 8 Government Services 8 6. Team 9 Leadership Team 9 Strategic Advisors 10 7. Key Terms 10
BCC Whitepaper 2 1. Introduction Blockchain for Change Blockchain for Change is a technology company at the nexus of digital identity, community and financial inclusion. The core of our service is a new system powering verified, autonomous, and sovereign identity. Through our service, we can reduce fraud associated with government benefits and streamline access to and management of critical resources for low-income and underserved people, first in the US and ultimately globally. A sovereign digital identity grants ownership of personal information -- and singular control over its use -- to the individual. With our Change Pass, a sovereign ID holder determines with whom information is shared inside a marketplace ecosystem. Figure 1: Structure Fummi, Blockchain for Change s first product, is a mobile application designed to provide low-cost financial services through cooperative purchasing partnerships for low-income and underserved individuals. These interactions use what we call a SmartID: a proprietary protocol for enabling a certified authority to verify identity on the blockchain. This method of verification called the Change Pass verifies a user s access to the Fummi marketplace and enables secure transactions and safe storage of money and information. 2. Change Coin The Change Coin is an ERC 20 token that is used as a currency within the Fummi ecosystem. The Change Coin functions as an access point and transaction mechanism between users, service providers, and the Fummi platform. Within that system, the Change Coin is set up to encourage value-creating activity via behavioral incentives. For example, when a user s SmartID is stored on the platform/blockchain, the user receives a reward of 30 Change Coins for successfully onboarding onto the platform. The underlying use of the Change Coin is designed to: 1. Verify and secure digital ID; 2. Reduce the cost of services through the cooperative purchasing platform; and 3. Function as a currency for improved and sustainable alternative financial services. Blockchain for Change will be raising capital through a sale. We intend on selling 73,520,000 Change Coins out of a total of 200,000,000 Change Coins. To incentivize user adoption of the smartphone program, Blockchain for Change will be giving away 30 Change Coins per phone or app download. At scale, we will be giving out 78,480,000 Change Coins to 5 million smart phones over the course of three years. The Change Protocol allows Blockchain for Change to do this through the inflow and outflow of Change Coins in the ecosystem with the help of the Blockchain for Change s Monetary Supply Account. The Change Coin is integral to use the platform. In order for people to get discounted features and/or services on the Fummi platform, they must pay part of the value of the service or feature in Change Coin. Each service or feature will have a set discounted cost through Change Coin, and the tokens spent to access the services will be returned to the Blockchain for Change working capital account and then redistributed to acquire new users at the market rate.
BCC Whitepaper 3 3. The Problem Verified Identity & the Traditional Financial System Modern services constantly require users to provide a verified, government identity. IDs are needed, not just to drive a car or enter a bar, but to register for school, open a bank account and access many government benefits. Individuals who do not have verification are locked out from vast expanses of the modern economy. According to the World Bank s Identification for Development (ID4D), 1.1 billion individuals worldwide do not have the ability to prove their own identity, and more than 2 billion people are excluded from the traditional banking system. Around 60% of adults worldwide who do not have a bank account cannot access one because of a lack of minimum funds, evidence of the limits of the current state of financial services inability to address the needs of low-income individuals. In the United States, our immediate focus, approximately 13 million voting-age citizens do not have proper and updated identity documentation. 9 million of the 67 million low-income individuals who receive federal benefits are unbanked, with significant ensuing societal costs. One study showed that this gap in documentation directly prevents them from accessing basic services, noting: An officially-recognized form of ID is the key enabler critical not only for exercising a wide range of rights but also for accessing healthcare, education, finance, and other essential services. The problem is particularly acute in New York City: 127,000 men, women, and children suffer from unstable financial and home lifestyles, the highest number since the great depression; meanwhile, a further 780,000 individuals are underbanked. The Current System: A Snapshot of the United States Current welfare systems are localized, outdated and inefficient. Their limited data capture often operates on analog systems with storage problems. Without the money or resources to properly protect their data and information, disadvantaged populations are uniquely vulnerable to data theft, social engineering and fraud. This system also means that the security of private data is at the mercy of weak, outdated, expensive and siloed systems. In 2011, the US federal government spent $140 billion on welfare. However, the systems through which this funding is implemented are similarly outdated and prone to fraud, leading to an annual loss of $3 billion. Ultimately, these programs were created to provide a bridge for low income citizens to get ahead for themselves. Local service providers and governments typically only provide support to the underserved for short terms (six months). At the same time, there is an enormous gap in utilization of the available technological capacity. For example, 97.4 percent of people in New York City, with incomes below $200.00 a week, own a smartphone because of a dedicated program to provide them with connectivity. This resource presents a distinct, untapped opportunity to provide lost-cost services that can transform people's lives. The underlying premise of Blockchain for Change is that verified identity is required to facilitate inclusion in the modern economy. In turn, inclusion is required for the growth of critical sections of economies. That is because without verified identity, the economic systems driven by social welfare services are inefficient. This is not only a problem for the billions of people who are excluded from the system but also for the organizations and governments trying to provide welfare services to their citizens. The key value proposition of Fummi is the creation of an efficient platform for the delivery of welfare services through a plug-and-play infrastructure for service providers to advance financial inclusion in a demographic where more people currently own smartphones than bank accounts.
BCC Whitepaper 4 4. The Solution Fummi harnesses blockchain technology to redefine the usage of digital identity for financial services. These financial services provide low-cost specialized interactions for users opening the doors to the digital economy. Service providers have access to a cooperative network, which grants organizational transparency and auditability (which enables low-cost services). Due to the inherent fraud prevention and management of encrypted data on the permitted blockchain, service providers are incentivized to secure their users data with our SmartID. Originators of user data are rewarded in Change Coin when other service providers utilize the user IDs for services. Users use their SmartID to interact and transact with providers. This identity permits users to store money safely, access new opportunities such as building a alternative credit score, and getting discounted services from service providers. The record of interactions itself drives the Fummi attestation strategy, validating the SmartID data and applicability. The embedded Fummi SmartWallet (Users secure and protected record of accountability and transaction history), further offers a mobile financial services tool, which operates much like a more flexible bank account. Identity on Blockchain Blockchain offers a mechanism for truly decentralized authority across a multitude of industries, not just financial services. With this decentralized authority, we can eliminate a class of third-party verifiers and redundant middlemen from the web of online interactions. In particular, transactions between parties can maintain anonymity, integrity and true digital verification. In the context of digital identity, this offers the potential to close the gap between technology and sovereign identities for the first time. In our specific context, the SmartID, enables a decentralized authority to foster trust through proof of authority consensus. Service providers, nonprofits and government agencies on the Fummi marketplace will have authority roles on the distributed network. These decentralized authorities will initiate the verification of autonomous identity and establish the trust protocol of the blockchain. The Fummi Application Fummi is a blockchain-agnostic marketplace and platform that provides and facilitates the digitization of an individual s identity. Building a layer of economic history on top of a user s identity is the next step to allowing individuals to join the global financial community. Through the use of permissioned networks, a user s identity is protected and its use is controlled. This provides the underbanked with an accessible and affordable solution that facilitates payments and transactions between users and service providers. The Fummi application is an Android app designed to provide a streamlined set of core offerings focused on the specific needs of our users. Users have the ability to: Create an account: The user can enter their personal information and set standards for their desired services. To be entered into the system, information must then be verified by a service provider. Earn money: The user can source additional earning opportunities directly via the app. Track activity and payments: The user can track transaction history and recent account activity. Book a service: The user can locate and request access to a demographically-appropriate shelter, food pantry or financial aid service. If desired, the user can filter through or select options using their geo-location. Verified transaction enable access to services: When the user reaches a service provider, they will be able to use the app (in coordination with the service provider) to verify the receipt of the service. Service Providers gain access to: 1. Verified SmartID management 2. Interdepartmental data management 3. Streamlined eligibility process and benefit deployment
BCC Whitepaper 5 4. Direct to user benefits and services funding 5. Specialized citizen benefit analytics 6. Smart contracts enable payment and transaction management 7. Fraud prevention through SmartID accessibility The Change Coin Ecosystem Change Coin Community Members of the Change Coin community that do not qualify for the free phone under the lifeline federal assistance program can trade their Change Coin on exchanges but will also be able to use their Change Coin in the Fummi ecosystem. These holders of Change Coin can interact with the Fummi ecosystem in a number of ways: Access peer-to-peer lending and approved Change Score/credit ratings. Give donations to people to their favorite nonprofits on the Fummi Marketplace. Once deployed, the Fummi mobile application will provide users with an intermediary tool connecting government agencies and nonprofits organizations to direct funding and aid. Fummi will be pre-installed on smartphones provided by our partners at no cost to the end user. This ease of access will facilitate streamlined eligibility processes, mitigate fraud, improve the management of funds, and reduce transaction costs. Retention through Utility Change Coin gives users a safe vehicle to digitally store their money and transact for services within the ecosystem. By completing a series of positive transactions, users build a verified digital financial history. This record will define the users Change Score, an output generated during the financial actions of each individual user. The Fummi Change Score acts as a record of financial decisions enabling access to different financial services. In the future, via micro-financing products, the Fummi application will use the data collected from users and their habits to suggest the best financing products to address user needs (both life and business). One of the largest issues associated with financing products today is the inability for users to understand the true cost of certain products. Through Fummi and the financial products/partners, users will have access to accurate information regarding financial products and services. Finally, the Fummi application acts as an education resource for users, helping connect users with the necessary information to understand and plan for the future. Financial literacy rises with education and is paramount to the long term vision of Blockchain for Change. All of this is made possible through the Fummi Smart ID, which stores an individual s profile and personal data and enables support of personalized push notifications for the users. Fummi s SmartID keeps track of a user s Change Coins, credit ratings, and financial behaviors on the blockchain. These data heuristics drive the trust protocol of the network, improving the marketplace and ensuring the user has access to the right services. Blockchain for Change Code of Ethics All digital frameworks require a balance of human and technology governance. In order to protect privacy, security and dignity of all individuals, certain regulatory frameworks are required and implemented within the network. Blockchain for Change is committed to the highest standards of transparency, accountability and security within its own organization and throughout its network. Blockchain for Change requires individual entities within its network, including itself, to operate in accordance to basic standards and in full compliance with all applicable laws and regulations. Although each participant shall have differentiated responsibilities within the network, all participants shall be held accountable for the following: a. To solely utilize the blockchain technology toward the end goal of positive social impact; b. To maintain consistent, transparent and complete communication throughout the network in all forms and variations; c. To share accountable and reliable information required for identification;
BCC Whitepaper 6 d. Any exchange of assets is subject to the law of the land. Any misuse of an exchange of assets will be dealt with under the appropriate legal repercussions; e. To respect anonymity and prevent transaction obfuscation; f. and to protect, uphold, and empower individual human dignity and equality regardless of race, color, gender, language, religion, political or other opinion, national or social origin, property, and birth or other status. User Growth and Acquisition Change Coin is an ERC 20 token with a total supply of 200,000,000 CNG. Out of the 200,000,000 CNG, Blockchain for Change will use 78,480,000 Change Coins in the Fummi Ecosystem to reward the Early Adopters. The Early adopters will get rewarded with 30 Change Coins each to drive user acquisition, a referral model will enable users to refer friends to receive a smart phone and receive additional Change Coins. Partnerships are another key avenue for user growth and retention. We will leverage existing and future partnerships along with customized referral models to maximize user growth. Change Protocol The Change Protocol is the economic cycle which enables 78,480,000 Change Coins to flow through a continuous loop within its ecosystem, driving the underlying value of the ecosystem and services on the platform. The Change Coin flows through the system from the monetary supply account to the users, service providers and then back out to the monetary supply account. The inflows and outflows are adjusted by the monetary supply account, and can be influenced accordingly. Ethereum ERC 20 token Purchase Methods: ETH, BTC, USD Total Token Supply: 200,000,000 Sale Goal Minimum Raise: $5,000,000.00 USD Goal: $50,000,000.00 USD Users (Airdrop) Percent of total: 39.24% CNG: 78,480,000 CNG/user: 30 Token Breakdown Percentage Token Users (Airdrop) 39.24% 78,480,000 Sale 36.76% 73,520,000 Advisors 7.00% 14,000,000 Team 6.00% 12,000,000 Ambassadors 4.00% 8,000,000 Bounty Program 3.00% 6,000,000 Development 3.00% 6,000,000 Legal 1.00% 2,000,000 Total 100.00% 200,000,000 Distribution Roadmap Figure 2: Use of Funds Figure 3: Five stages of distribution
BCC Whitepaper 7 5. Market Opportunity for Growth Scope Smartphones have gained widespread adoption in our globalized society. Unlike other technologies, this adoption has transcended socio-economic and demographic divides. This democratization of technology has the potential to radically reshape the landscape of financial services, digital identity and social impact. Fummi is uniquely positioned to coordinate a cooperative purchasing marketplace that can leverage the smartphone accessibility to provide services to the underserved and underbanked. Blockchain for Change can do this through its relationships within government, wireless network providers, nonprofits and financial sector companies, Fummi incentivizes user adoption with Change Coin, free smartphones and reduced cost of services in the application. In addition to these, users enjoy the security, safe storage of cash and encrypted digital identity protected on a distributed ledger. In order to access these services, a user must have successfully been verified through Change Pass. Our launch aims to primarily empower underserved and low-income individuals that benefit from and interact with service providers on our network. Looking ahead, our user acquisition will grow to target the underbanked, and finally, the mass market. By going bottom-up, we will enter the market and scale upwards, as our platform matures. Our initial distribution combines outreach via service organizations, direct marketing, and carrier distribution. Figure 4: Market opportunity for growth Do you have questions about our service provider network? Check our our partnerships on our website. Differentiation Business Competitors The digital identity landscape as we know it is has these main participants: Banqu, Civic, Cove, Humaniq, and Indy. Below is a breakdown of unique implementations of blockchain-enabled identities for each of these organizations.
BCC Whitepaper 8 Commercial Banking Figure 5: Differentiation model Although technology has already reached the forefront of the banking industry, a huge percentage of Americans still don t have their own bank accounts. One in nine households is without a checking account. And almost 1 one-third of the population is underbanked lacking the full range of basic financial services. Most of the underserved and underprivileged do not utilize commercial banking services for a wide array of reasons. The structure of the commercial banking system incentivizes banks to focus on and pursue customers who will generate the highest revenue for said banks in the future. Therefore, they primarily prey on individuals likely to succumb and subscribe to expensive services. In addition, many low-income individuals work long, arduous hours and live from paycheck to paycheck. With little to no time to take advantage of traditional banking hours and the dearth of branches present in low income neighborhoods, the mistrust of commercial banks seems unequivocal. Furthermore, the fees associated with the minimal balance incurring charges and check cashing services (typical methods of payment for smaller contractual jobs) simply further propagate the lack of trust in commercial banks, especially among recent immigrants. When all of the aforementioned is coupled with the simple lack of financial understanding and education, it appears as though all hope is lost. Blockchain for Change will be able to ease and overcome these fees and obstacles by ensuring a near zero cost for users on the Fummi Marketplace. Government Services The current government ID systems are clearly not equipped to deal with those who are already outside of the system. The following list includes some of the blockchain initiatives currently run by the United States government: Delaware is running a Delaware Blockchain Initiative, a groundbreaking new project seeking to clarify the State s law and welcome the blockchain industry into the state. Illinois Illinois Blockchain Initiative (IBI) is moving ahead on five use cases to determine how industry and government can work together to improve government services. Government services on the blockchain are nascent, exploratory and open to molding. The Blockchain for Change team is in talks with a number of local governments to run pilot programs centered around identity and financial inclusion. 1 http://business.time.com/2012/11/20/why-so-many-americans-dont-have-bank-accounts/
BCC Whitepaper 9 6. Team Leadership Team Strategic Advisors
BCC Whitepaper 10 7. Key Terms Airdrop : A method of distributing cryptocurrency amongst a population. Blockchain : A transparent, digital ledger shared by all nodes participating in a network. It can be accessed and scrutinised at anytime by anyone. Every transaction is recorded into the blockchain in files called blocks. Each block represents some or all of the most recent transactions that have not yet been recorded in any previous blocks. Blockchain for Change (BCC) : A technology company at the nexus of digital identity, community and financial inclusion. BCC builds transparent and accountable solutions for social impact on top of a blockchain-agnostic marketplace. The core of our service is a new system powering verified, autonomous, and sovereign identity. Fummi application : The first product of BCC. A a cooperative purchasing marketplace on the blockchain that connects and allows for secure transactions and interaction between service providers and users. User: Individuals who use the Fummi application to create a SmartID in order to interact and transact in the Fummi marketplace of various service providers. Service provider : A non-profit, private, public, or government organization that exists to provide some form of assistance, merchandise, or product such as food, temporary housing or other assistance services to Fummi users. Fummi SmartID : A proprietary protocol for enabling a certified authority to verify identity on the blockchain. This protocol provides users access to the Fummi marketplace. Fummi SmartWallet : Users secure and protected record of accountability and transaction history. Change Pass : The underlying algorithm of the Fummi SmartID. Change Pass verifies a user s access to the Fummi marketplace and enables secure transactions and safe storage for money. The protocol then enables a sovereign ID-holder to determine with whom information is shared inside a marketplace ecosystem. ERC 20 token ( token ) : The ERC 20 token is a standard token protocol built on top of the ethereum network. Change Coin : Forms the utility for the ecosystem on the Fummi Marketplace. Change Score : An aggregate score based on the history of financial transaction of each individual user on the Fummi Application, intended in the long term to function as an alternative credit history.