Abstract

KORA network is aimed at providing people without access to smart phones with a tool that will enable them to benefit from the perks of the financial systems via non-smart phones through SMS and USSD, as implied by the name KORA, an instrument for playing songs with hopeful messages.

Problem

The services of the financial systems statistically help the middle and lower classes improve their wealth as proven by a Mexican bank named Banzo Azteca in 2002. However, approximately 2 billion adults are denied these services which further detoriates the gap between the rich and the poor. There are 5 identified major reasons for this which are the misperception that the poor do not deserve investment, high costs of infrastructure for financial services, lack of identification, past unfortunate events that leads to mistrust and lack of financial literacy.

Related Works

There have been low scale solutions to the problems mentioned above, such as a shared money pool which is not high tech but still sophisticated in the semidesert regions, mobile money which is highly isolated from other operators, blockchain projects which are costly for the very bottom and banks themselves. They are all inadequate and the necessities can be broken down as this : low cost, universal access, engaging with other communities, all of which KORA will carry. [embed]https://www.youtube.com/watch?v=HUsut61I4aY[/embed]

Building Blocks for Inclusive Financial Systems

A financial system has essential elements to function properly. KORA network will contain 4 elements that will be scalable in the future which are identity, secure storage, money transfer and marketplaces, allowing the users to claim and keep their returns from their transactions on the network, borrow from and loan funds to other users either through the network itself or via local agents and have a platform to use their funds as a cryptocurrency within their community.

Universal Access and Identity

KORA network will mainly appeal to those who cannot afford a smart phone but it will also be accessible with them so that as many people as possible can have access. The users will be granted a combination which they will submit via SMS or USSD to access the service. In order to eliminate fraud schemes, KORA network will require a multi-leveled identification process, in which the users will be able to provide their credential as much as they can, let it be a government ID, a biometric photograph and fingerprint or reference from another user for people suffering from bureaucracy, in each level increasing their transaction and cryptocurrency storage limits within the network, which will further depend on reputation points from others, as well.

Minimizing Cost Through The Blockchain

KORA aims to see through all the non-essential elements in a financial system, strip it from them and expose it as bare as it can so that the unnecesities can be eliminated to relieve the customers of the unnecessary charges. The main element within the conventional financial systems that increases the levels of costs to the degree it’s not worth providing everyone with it is the manpower. The jobs of approximately %60 of the staff in a bank are either to secure the centralized software that contains pretty much all the data that can possibly exist about their customers or to deal with simple paperwork and customer support, which makes it economically inefficient and puts further burden on the customers. The solutions with the blockchain are that the data the banks try so hard to keep and secure in one single place can be distributed along the whole network, the security of which scales further with the number of users and that dealing with paperwork can be automated with AI or another third party program, which can be even more beneficial because it eliminates human error and bribery.

Network Architecture

The KORA network is a combination of Ethereum Virtual Machine and Tendermint consensus (Ethermint) that is scalable, programmable, resilient and decentralized, which is originally inspired by Cosmos Network26 and Bitshares27(DPoS). The way the network will function is democratic and incentive, put as simply as possible. The providers will mainly be responsible for creating the blocks but the users will also have access to the blockchain only if they have enough local cryptocurrency (KNT) for transaction fees, are competent and have the necessary technological equipments. The users will be able to invest in those candidates, which will be done via the local crptocurrency. A voting process will take place, to join which the candidates will make an entrance fee besides the investments in them, and after the voting, the top candidates will be at work. The payment to them will be either pre-determined or increased proportionately as the network enlarges. A precedent for this was set by Bitshares and Dash Masternodes. The investors of the candidates will receive proportionate payments, as well. If the elected are detected to be malicious later on, they will be kicked and the users will be granted back their investments.

Kora Network Token (KNT)

Cryptocurrency can be better defined if how it is different from fiat currency is understood. A fiat currency can be faked in physical bills and distributed from a centralized bank, so they are secured with countermeasures against that but cryptocurrencies are secured through digital encryption, the transactions are public, they are held with private keys on a decentralized network and they are not monopolized. There are 3 different sorts of cryptocurrency: digital currency, utility token(3 subtypes) and crypto assets. Digital currencies are used as a tool for trade and the transactions are public information. Utility token is a token utilized beyond financial purposes and it has 3 different types which are Usage Token, Work Token and Hybrid token. Usage token is used to access a very specific service for which a specific utility token is made. Work token is used to gain reward for contributing to a service. Hybrid token is the combination of both. Crypto Assets are created to be exchangable with conventional assets such as gold and dollar.

Money Transfer and Payments

KORA network will enable its users to save time and money when they need to send money to their families and friends who live in remote areas where there is little technological infrastructure via SMS and USSD, which currently requires commute and high transaction fees taken by banks. KORA tokens will be convertable through the local agent within the community, the transactions of which will give credibility to the user if in the future they need to take loans from the network. It will basically give an alternative to those who suffer from the lack of infrastructure.

Conclusion

KORA network will provide services for the people who are not invested in because of the poor situation of the region they live in, which is predominantly poor because there is no investment at all; a horrible loop in general.

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