Introduction

This publication describes the Kinesis monetary system as a new evolution of the current monetary system, supporting its value in precious metals such as gold and silver in relation to 1:1. Kinesis has designed a model that encourages the use of currency and allows to maintain a reliable and sustainable economy making use of blockchain technology.

We will see how the components of the system create a synergy that keeps the monetary system implemented by Kinesis in operation.

Kinesis

It is well known historically that economic systems usually deteriorate, fiat money does not last long enough due to the bad habits of the human being. The economist Sir Thomas Gresham indicated it in his principle "bad money drives out good" (Gresham's law). The same goes for cryptocurrencies, users tend to retain them to avoid losses or wait for prices to rise and then exchange them and make a profit; This means that cryptocurrencies are not used as a reliable economic means, also due to market volatility.

Normally fiduciary money is backed by a physical asset or precious metal, such as gold or silver. However, the dollar, the dominant currency of the world, is not backed by any type of valuable asset since 1971. The problem with this is that the Central Banks print more money to compensate for their value, causing economic inflation.

These actions do not stimulate a healthy economy activity which creates instability at all levels.

Kinesis proposes a monetary system designed to solve all of this type of tendencies that destabilize the world economy. This system combines the blockchain technology with the support of precious metals, gold and silver, to create a more just and sustainable economic system through the creation of a more solid and reliable currency, which will generate income constantly the more be used; which continuously encourages transactions of purchase and sale of services and goods (money velocity) keeping the economy stable. What minimizes the risk and maximizes the return.

The main elements that make up the Kinesis ecosystem are:

• Gold and silver. The main currencies of the Kinesis system, KAU and KAG, are backed 1:1 with gold and silver bullion, respectively. Distributed in vaults worldwide, in a decentralized manner and secured both physically and digitally by the Kinesis banking system.

• Yield: is an incentive of the Kinesis system that allows participants to obtain constant income directly from any economic activity carried out within the ecosystem, be it passive (savings) or active (trading) way.

• Finally, utilizing the technology of the blockchain Stellar (which allows to make 3000 transactions per second) and the cryptocurrencies, obviously improved with the use of the two previous elements.

Allocated Bullion Exchange (ABX)

The Kinesis monetary system has been developed in partnership with the Allocated Bullion Exchange (ABX) company, leader in worldwide precious metals exchange since 2013. ABX has modernized and globalized the precious metals market, opening the doors to all participants in the exchange of precious metals, such as jewelers, investors, producers and manufacturers. Kinesis takes advantage of ABX's extensive network of associates and infrastructure and its fully operational technology to exchange and store physical bullions in 7 parts of the world. In this way Kinesis, allows any user to acquire gold or silver, literally, through their monetary system.

Finemetal Asia Ltd

Finemetal Asia will provide the necessary liquidity for the KAU and KAG currencies of the Kinesis monetary system. Finemetal is one of the largest companies that exchange and distribute bullions throughout Asia. It will provide support for the physical ingots that will be used as a medium of exchange in the Kinesis monetary system.

Kinesis Monetary System Components

The following scheme describes the relationships of the units that make up the monetary system of Kinesis.

Source: White paper

• Kinesis Currency Exchange (KCX): is the place where system currencies (KAU and KAG) are created and minted. This occurs within any organization that is part of the ABX trading network.

• Kinesis Blockchain Network (KBN): The coins created and minted are issued in the blockchain of the Kinesis ecosystem. Thereby, they are part of the economic system of Kinesis and therefore, can be used as cryptocurrencies to perform any economic operation. These currencies will generate income (yield) when making transactions with them except for being exchanged for other cryptocurrencies within the KBE.

• Kinesis Blockchain Exchange (KBE): This component functions as an exchange center for cryptocurrencies and Kinesis tokens. This allows the liquidity of the Kinesis tokens.

• Kinesis Financial Network (KFN): This represents the financial system of the Kinesis ecosystem. It includes e-commerce technology, as well as having its own MasterCard and Visa debit card which can be used anywhere Visa/Mastercard is accepted, making Kinesis a fiat or monetary system. It also allows users to withdraw funds through any ATM around the world.

• Kinesis Commercial Centre (KCC): This component functions as a center of commerce to allow the purchase of services and goods. This is done by integrating an API to allow merchants to participate in the Kinesis monetary ecosystem.

• Kinesis Digital Bank (KDB): the Kinesis ecosystem has a mobile system, which allows managing the funds of the user's wallet. Equivalent to a virtual savings account that allows earning interest through the perpetual incentive system (yield). In the image you can see that the mobile system allows users to recharge the Kinesis debit card, in addition to allowing to send and receive money from other people, perform operations on funds, telephone calls over long distances, payroll, etc.

Source: White paper

Kinesis Currency Suite

Kinesis has developed its own blockchain system created from the Stellar blockchain, allowing the Kinesis system to perform 3000 transactions per second and offering greater security than the Stellar standard. The coins of the Kinesis system are:

• KAU (Gold currency): token backed by a 1g gold bar with a minimum fineness of 995. Approved with the ABX quality seal (serial number and identity stamp).

• KAG (Silver currency): token for a 10g silver bar with a minimum fineness of 999. Approved with the ABX quality seal (identity stamp).

The Kinesis ecosystem also has wholesale coin specifications.

• KWG (Gold Wholesale Currency): token backed by a bar of 1 Kg of gold with a minimum fineness of 9999. Approved with the seal of quality of ABX (serial number and identity stamp).

• KWS (Silver Wholesale currency): token for a 1,000 oz t bar (31 kg) of silver with a minimum fineness of 999. Approved with the ABX quality seal (identity stamp).

Source

Kinesis Economy Participants

Kinesis Minters

They are those who buy gold or silver through the KCX, which issues the coins in the blockchain, KAU or KAG, which can be sent, spent or sold within the Kinesis ecosystem. The minters receive a continuous compensation (yield) when using the currency within the ecosystem. Maintaining a stable economic system through incentives. The yield originates from the velocity of money and fees for transactions made with the currencies created.

Source: White paper

Kinesis Depositors

Those are who exchange fiat or other cryptocurrencies for Kinesis currency (KAG or KAU), these will be deposited in Kinesis user's wallet. They receive a revenue for the initial deposit and continue to receive compensation for the use of the ecosystem currencies through the KFN and the KCC.

Source: White paper

Kinesis Holders

Those are who buy the Kinesis system tokens as an investment, so they do not make transactions with them but rather keep them as an investment. And they will also receive a yield for their passive participation from the fees generated by the KBN and will be deposited monthly in their accounts.

Source: White paper

Kinesis Affiliates

This component is used to increase the participation of new users in the ecosystem. Affiliates will receive perpetual compensation for each person they recruit; from the transactions made by new entrants. In this way, Kinesis provides a business opportunity for any participant in the ecosystem.

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It is important to note that the yields will begin to be deposited in the funds of the participants (Kinesis wallet) when they start to make transactions with the tokens inside the ecosystem; except those who exchange their Kinesis tokens for another cryptocurrencies.

Kinesis Velocity Token (KVT) & Initial Token Offering (ITO)

The KVT is the native token of the platform, complies with the ERC20 standard. The KVT receives 20% from the fees for transactions made within the Kinesis monetary system and 20% from the KCC. 1 KVT is 1000 USD. The KVT ITO is a public sale that will be held from September 10th to November 11th, 2018.

The Kinesis currency (KAG and KAU) are set during the ICO, which begins on November 12th, 2018.

Kinesis Use-Case

Cargo Inc

The transport company Cargo Inc has decided to use the monetary system of Kinesis. Mint coins through KCX (backed in gold 1:1), buying them with the country's fiat currency and opted to obtain Kinesis debit cards for their employees through KFN. Thereby, the company can pay the payroll in Kinesis currency, transferring directly to the wallets of its employees. The company will obtain a benefit by receiving a revenue (yield) for the transactions that its employees make with the Kinesis currencies. Creating a sustainable economic system that will grow from time to time and more by investing its profits in acquiring KAU and KAG tokens.

Likewise, employees can obtain revenues using their Kinesis debit cards in the KCC, acquiring goods and services.

Mike

Mike is an investor who has decided to invest in the Kinesis monetary system. So he acquires Kinesis currencies through the KBE, obtaining an income for the deposit made, increasing his profitability. However, he realizes that he can acquire more revenues by encouraging other people to join the system through referrals. Increasing his funds for referrals and for transactions made by his referrals with the Kinesis monetary system. Obtaining a perpetual reward by deciding to invest in Kinesis.

Conclusion

Definitely the Kinesis monetary system represents a win/win relationship for all participants involved. Kinesis establishes a solid monetary system thanks to its support in gold and silver, in a 1:1 ratio. However, the best thing about this system is the continuous incentive that keeps the economic system alive. Offering a unique system in its kind, by generating dividends when using Kinesis money, that is, the more it is used (trading transactions and sending the currency to others participants) the more it is earned; unlike conventional schemes where money is not revalued but devalued.

It should be noted that by implementing this system under blockchain technology, it establishes a decentralized scheme that prevents it from being controlled by government entities or corporations, creating a fairer system for all.

Annexes

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