Submission to the @originalworks 100SBD sponsored writing contest #1 UTRUST2017

At first glance the proposed UTRUST cryptocurrency exchange and retail payment platform sounds amazing - at first glance. The forty eight hour submission time frame makes providing a detailed, well researched, and accurate review, difficult at best. Considering the many complexities inherent to any new financial endeavor is in itself a very daunting task - and I don't think i'm wrong to say, analyzing a retail / exchange platform like the one proposed, is at the very least, a challenge.

Apart from the primary obstacles any new payment platform will face - implementation by retailers, and adoption by consumers. The UTRUST developers, and by extension the governing board, will have to address the ever changing financial rules and regulations associated with cryptocurrencies, the not so clear statutes relating to internet based commerce (different state to state), the SEC anti-money laundering statutes, and the Patriot Act anti terrorism finance restrictions, just to name a few.

At this point i'm going to break from the other entries I have read thus far and concentrate my attention on the before mentioned items that have not yet been detailed - the various regulatory statutes and the bodies that govern them. Additionally there are several issues where I see the potential for catastrophic failure of the whole enterprise, happening almost immediately if not addressed.

Unanswered Questions

• On pages 8 through 15 of the UTRUST whitepaper, there is a tremendous emphasis placed on the built in protections for both consumer and retailer - intended to provide a level of comfort for issues that arise such as stolen credit cards, charge backs, hacked accounts, market volatility, and a robust mechanism for conflict resolution.

However unfortunate, each of these issues likely will arise, and in the political and economic environment UTRUST seeks to operate, each and every one of them will have to be dealt with in accordance with whatever law governs the specific activity / issue faced - I have only been able to find basic information detailing how these things will be resolved (simple arbitration), and nothing describing under what legal statute(s) each of them will reside.

• On pages 26 through 29 of the UTRUST whitepaper, there is a very detailed description of the distribution and allocation schedule for the newly minted coins. However there is only a vague detail describing the future administration of the blockchain, and less so describing any control mechanism to prevent "tampering" of the pre-mined coins.

• Beginning on page 30 of the UTRUST whitepaper, the developers detail how they will implement the ICO without any "American" funds to avoid conflicts that could potentially arise from the US Securities and Exchange Commission.

...as a preventive measure of caution and due to US Securities and Exchange Commission new
regulations 1 we do not currently accept contributions from US citizens.

This action may appear to have merit and may be useful to avoid headaches at first, but it could also become a major liability in the future. The American market comes with a large number of "hoops to jump through", but lets be honest, if any platform is going to take on the financial "monster" that is PayPal, the US market is the only one that matters.
Administering the ICO in accordance with US law could determine the overall success of the enterprise. The regulatory agencies who issue licenses, and authorize access to markets, will be much more apt to give the licenses, and the access, if the company seeking them went through the process.

• Last but not at all least, I want to touch on the single item that I believe could be the death of UTRUST, before it's even born - It's the issue of "market volatility" .

The process as I understand it... UTRUST will take any cryptocurrency (approved) and convert it into fiat currency to pay for goods and services to and from participating retailers, to and from consumers.

What will the outcome be, if the following hypothetical situation were to happen? More than once?

Joe Consumer purchases a flat screen HD television from Billy Bobs House of Boob Tubes for the bargain basement price of $1,000.00. Joe chooses to pay for his dream TV using this brand new method where any approved cryptocurrency can be instantly converted into good 'ol cash. Billy Bob loves the idea and was one of the first to sign up, being the savvy businessman that he is - he realizes a whole new market will instantly open up for business. The transaction goes like clockwork -Joe uses the Monero tokens he got selling hashish on Alpha Bay, and Billy Bob can fluff the numbers and in the end claim a loss on paper... Win Win all around...
Now looking past the exchange of goods and or services, to the exchange platform who made this dream scenario possible. UTRUST took an equivalent amount of Monero tokens from Joe to equal the $1,000.00 purchase price of the TV, and gave Billy Bob the $1,000.00 in cash, subtracting a minimal fee for their trouble. Again looking past the transaction, and imagine it just so happens that the DEA, FBI, and IRS all got their act together and managed to disrupt and/or shut down every market on dark web, essentially erasing 50% of the value of Monero, and to a lesser extent Bitcoin. Thereby bankrupting UTRUST out of the gate...

Im not at all sure if it's a sound business model, but these are my observations and concerns... Do with it what you will... :)
Thanks for reading...
MDG...