What Is COTI Crypto: Everything You Need to Know

Published: February 12, 2024 | Last Updated: January 31, 2024

Hudson Kisia

Hudson Kisia has been researching and writing content for ElementalCrypto since 2022. He has been writing about crypto, blockchains, and mining for more than 5 years now.

In this article, I explain what COTI crypto is.

Billing itself as the ‘Currency of the Internet’ (COTI), this cryptocurrency employs a unique consensus algorithm that is based on trust score, a Proof of Trust (PoT) indicator, instead of Proof of Work (PoW) or Proof of Stake (PoS) algorithms.  The COTI network employs the Directed Acyclic Graph (DAG) architecture. See crypto mining algorithms for more on this.

Later on, we will explore why this Trustchain algorithm and DAG network architecture was chosen by COTI Group and its co-founders Shahaf Bar-Geffen, and David Assaraf.

But, before we delve into the technical details, let’s understand the rationale behind COTI crypto.

Why COTI Crypto?

Reasons that make COTI crypto worth considering include:

1. Scalability

COTI MultiDAG 2.0 for advanced scalability
COTI MultiDAG 2.0 for advanced scalability

The DAG architecture is massively scalable. The biggest bottleneck that makes Bitcoin’s blockchain network not scalable is its architecture.

The COTI network addresses this scalability challenge by employing a MultiDAG protocol to achieve high throughput.

High scalability enables the COTI Platform to have a broad base of use cases and applications.

2. Universal payment gateway

COTI Trust-based UPS
COTI Trust-based UPS

Designed as the ‘currency of the internet’, COTI has a built-in Universal Payment System (UPS). UPS is the key feature that makes this ‘currency of the internet’ possible.

It operates much like PayPal except that it is not as limited as PayPal since it is designed to process both cryptocurrencies and fiat currencies. It offers far more features than PayPal and it is less restrictive since it is universally available, unlike PayPal which is geographically restricted. The PoT algorithm is what makes it less restrictive.

3. Superfast transactions

One big benefit of the DAG architecture is how fast transactions get processed. DAG data structure allows multiple pathways in terms of recording and retrieving transactions. This allows multiple transactions to run concurrently.

4. Low cost

Due to the unique nature of the DAG protocol, less cost is incurred in processing transactions. The network (gas) fee is extremely low due to the economies of scale.  This translates into lower transaction fees. Ultimately, this results in low fees across the board.

COTI network use cases

COTI potential use cases
COTI potential use cases

Let’s consider both the actual and potential use cases of the COTI blockchain platform. The following use cases become conspicuous:

1. Payment gateway

Coti PoT payment gateway
Coti PoT payment gateway

The most important role of the COTI’s UPS is to operate a payment gateway. As such, UPS is largely a global payment network that facilitates payment methods in both crypto and fiat digital currencies. This makes it the most ideal option for remittance services.

2. Decentralized exchange (DEX)

COTI protocols are based on enabling decentralized exchange (DEX) of digital currencies. Unlike centralized exchanges such as Binance, COTI doesn’t engage in overbearing control over transactions.

3. Smart contracts

Due to its decentralized nature, superspeed, and high scalability, COTI’s platform is ideal for smart contracts.

Later on, we will discuss more about COTI smart contracts under the Fintech features.

4. Network bridging

The biggest drawback of the Blockchain ecosystem is mobility to and from one network (such as Bitcoin) to another (such as Ethereum). Mechanisms exist but are restricted by lots of technical and financial bottlenecks.

COTI provides a convenient and seamless network bridge across various blockchain network domains. With COTI V2, users can store private keys of their digital assets from across diverse networks thus making bridging a less complex affair.

Already, COTI native coin exists on Trustchain, Ethereum (as an ERC-20 token), and BNB Chain (as a BEP-20 token). It plans to expand onto other blockchain networks.

5. Real-world asset management

The COTI network is designed to host dApps that facilitate the tokenization of real-world assets. This makes it possible to easily identify ownership, transfer ownership, and trade in them.

In supply chain logistics, privacy dApps enable stakeholders to identify, verify, and track the movement of assets across various points on the supply chain.

6. DeFi

It is natural for a decentralized network platform like COTI to support Decentralized Finance (DeFi).

Already, serving as a network bridge and having its native token, the COTI native coin, DeFi becomes easier to operate.

7. Anonymous marketplaces

Transitioning from COTI V1 to COTI V2, privacy and anonymity have become possible. COTI V1 was based on a traditional blockchain where a public crypto ledger was maintained and thus viewable by anyone who wanted to. On a public ledger, it is easy to track a transaction to its endpoints thus revealing the identity of parties to the transaction. This is made more possible with the advent of modern blockchain tracking software.

COTI V2 is based on Ethereum Layer 2 architecture which, unlike Layer 1, allows privacy and anonymity. Thus, anonymous marketplaces can be built on COTI V2.

8. AI dApps

Creating and deploying dApps that employ the use of AI for advanced analytics on the blockchain network and thus provide automated advanced reporting and advice.

9. Social Network dApps

Decentralized social networking dApps that protect and advance the freedom of speech. They can achieve this privacy protection, surveillance-proofing, and censorship-resistance mechanism.

10. Blockchain Art

Creation and hosting of NFT marketplaces for blockchain art in particular and programmable art in general.

11. Gaming and gamification

Support for on-chain private gaming. The MultiDAG architecture supports the multi-concurrency nature of modern gaming.

12. Governance

Decentralized, confidential, and anonymous voting system.

COTI platform features

The COTI platform is feature-rich. The following are some of the main features that implement some of the highlighted use cases, making this platform stand out from the rest:

1. Infrastructural features

Based on the Ethereum infrastructure layer 2, COTI protocols are very modern and advanced.

Nonetheless, the COTI network has crafted a unique niche of its own by customizing, advancing, and adding new features that make it beat the Ethereum network in many parameters.

(a) Decentralized platform

Being a decentralized platform means a lot. First, it means that there is autonomy. Platform users are not under the dictates of a central commanding authority. This autonomous governance structure protects users from adverse decisions. With autonomy comes privacy.

COTI platform guarantees user privacy. Your transactions are not open to public scrutiny. You can trade anonymously. Privacy is your right and your choice.

Furthermore, creators have the freedom to create dApps and host them on the platform. This increases the utility of the COTI ecosystem.

(b) Trustchain Algorithm

COTI Trust Score System
COTI Trust Score System

One of the biggest bottlenecks of the Bitcoin network and similar blockchain networks is the proof of work (PoW) algorithm. The PoW algorithm is not only energy-intensive but also time-consuming. This results in a very low transaction throughput.

On the contrary, the Trustchain algorithm is based on trust score. This score is an aggregate of a user’s historical trust performance in the previous transactions. For so long as the trust score of the parties involved in a transaction exceeds the set threshold, a transaction sails through. This is a faster method of proofing which results in a high throughput of transactions. This not only yields low transaction costs but also enhances user experience.

(c) COTI MultiDAG Protocol

The unique thing about the COTI MultiDAG protocol is that it has an infrastructure layer on each of the three major blockchain networks:

  • Trustchain
  • Binance
  • Ethereum

This MultiDAG protocol combined with network bridging enables UPS via COTI coin to function.

(d) COTI smart contracts

Through COTI V2, the latest of the COTI protocols, users can create and execute private smart contracts.

Smart contracts are the drivers of Decentralized Finance (DeFi). Unlike the traditional finance mechanism where there is a central authority and clearing house, DeFi works autonomously through the use of smart contracts. There is no third-party involvement. Parties to a transaction agree to a contract which is converted to a self-executing algorithm based on agreed parameters and doesn’t require any external intervention.

(e) COTI bridge

COTI bridge
COTI bridge

To make sure that COTI succeeds as a global payment network, the platform has COTI Bridge. This bridge links COTI Pay to other payment networks outside the platform.

(f) COTI SDK

Smart Contracts and other dApp solutions are made possible thanks to the COTI SDK. Through SDK, you can create your own payment solutions by creating payment dApps riding on the COTI network.

2. Fintech features

The COTI platform possesses the following advanced fintech products and features:

(a) COTI UPS

COTI Universal Payment System
COTI Universal Payment System

UPS is a universal payment solution that allows swapping of native coins, crypto tokens, and other digital currencies.

Some of the enablers of the COTI UPS include the COTI Pay business, COTI-X, COTI Coin, COTI wallet, COTI virtual debit card, and COTI treasury, among others. We will explore each of these enablers (which are also unique features) here below.

(b) COTI Pay

CotiPay value proposition
CotiPay value proposition

As part of COTI UPS, COTI Pay is a universal payment solution that allows both individuals and businesses to send and receive payments.

The COTI Pay personal operates just like PayPal except that it is natively designed for cryptocurrencies while PayPal is natively designed for fiat currencies.

On the other hand, the COTI Pay business is dedicated to ecommerce payments. Thus, it can be integrated into ecommerce shopping carts through plugins to facilitate COTI payments.  

(c) COTI-X swap mechanism

CotiX transaction flow
CotiX transaction flow

Thanks to the COTI Bridge, the COTI-X swap mechanism allows users on COTI’s platform to quickly and seamlessly swap crypto coins.

COTI-X leverages the COTI Bridge to let users swap coins and tokens from different blockchain networks from a single COTI platform.

(d) COTI Coin

Coti Coin
Coti Coin

COTI in collaboration with Cardano Network created Djed stablecoin. This stablecoin is now the native token of the COTI ecosystem. Djed stablecoin is commonly referred to as native COTI coin, or simply COTI coin.

COTI coin is used to facilitate transactions on the COTI platform. Furthermore, it also serves as a governance token on the COTI network.

Being an ERC-20 token, the COTI coin is compatible with other blockchain networks that use the Ethereum Virtual Machine (EVM). Thus, this ERC-20 COTI token is swappable on most DeFi platforms.

(e) COTI wallet

Coti Wallet
Coti Wallet

All the mentioned fintech features wouldn’t be complete without a digital wallet. COTI wallet is a Web3 wallet that forms a core part of COTI Pay.

Apart from supporting the native COTI coin, the COTI wallet also supports other stable coins plus more than 1000 coins and tokens in the crypto space.

(f) COTI virtual cards

Virtual Prepaid Card System
Coti Virtual Prepaid Card System

Integration between the traditional payment systems and the modern fintech systems is achieved through the use of COTI virtual cards. These cards operate the same way credit cards and debit cards operate. However, they are virtual.

They are the link between traditional bank accounts and the COTI financial system.

(g) COTI treasury

Staking is one way that boosts a DeFi platform’s liquidity and advances governance. COTI treasury is simply a staking pool where users deposit their COTI stable coins and get rewarded for their participation in the pool. Thus, COTI treasury is a liquidity pool created and hosted by the COTI platform.

3. The Tokenomic features

The native COTI coin has a fixed maximum supply of 2 billion. These coins are already minted and no more coins will ever be minted in the future.

The distribution of COTI coins is as follows:

  • Market sale: 30%
  • Node Operators and community members: 45%
  • COTI team members and project advisors: 25%

However, the circulating supply of COTI token sales in the market is less than the maximum supply. This is because not all COTI coins have been released in the market.

4. Privacy and security features

Garbling protocol for advanced privacy
Coti Garbling protocol for advanced privacy

COTI Garbling protocol provides an encrypted end-to-end solution for trading, payments, and communication.

5. Governance features

The entire Proof-of-Trust (PoT) protocol is a governance mechanism. The global trust system is a governance system that relies on stakeholders voting on the reputation of parties involved in various transactions and processes.

6. Other features

Some of the extra features of the COTI network platform include:

(a) COTI NFT

Blockchain art has become one of the most important digital assets on the blockchain networks.

COTI has a unique collection of NFTs. Unlike ordinary NFT marketplaces, COTI NFTs are mainly for gaming purposes.

(b) COTI gaming

COTI NFTs are used as gaming raffle tickets. Thus, players buy COTI NFT tickets to subscribe to a raffle in which they compete for a prize. The winner earns a specified amount of $COTI which is deposited into the winner’s wallet.

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Hudson Kisia has been researching and writing content for ElementalCrypto since 2022. He has been writing about crypto, blockchains, and mining for more than 5 years now.