COTI (Currency Of The Internet), a next-generation cryptocurrency that achieves high transaction throughput and lowfees, while being easy to manage and providing decentralised structures for the services users have come to expectfrom payment platforms, such as dispute resolution.

COTI achieves a high transaction throughput by employing a Directed Acyclic Graph (DAG) of transactions known as theCluster, as opposed to a blockchain. This idea is not new, and has been proven to improve performance. Typically,DAG based cryptocurrencies have been intended for large numbers of low valued transactions, possibly betweenmachines such as IoT devices.

Because COTI is designed to support day-to-day transactions between merchants and consumers, new algorithms have beenintroduced to drive the formation of the Cluster, and the approval of transactions. Fundamental to the new approachis the Trust Score, which is assigned to each user account based on its historical behavior, and which governs theapproval of that account’s transactions within the network as well as the amount of any possible fees incurred.

Problems & Solutions

It has been long anticipated for cryptocurrencies to significantly alter the online payment landscape. To accomplishthis, it is necessary for cryptocurrencies to be user friendly, convenient and highly scalable. Several blockchainbased technologies have been created to tackle the challenges posed by attempting to provide high transactionthroughput while remaining inexpensive, but these have been met with little success.

Another challenge faced is the lack of trust between unknown parties, which leads to countless chargebacks andtransaction cancellations. Moreover, merchants are often classified as ’high-risk’ or ’low-risk’ based on theirassociation with a particular industry, rather than on their actual behaviour.

COTI, Currency Of The Internet, solves these challenges by using an innovative base-layer protocol in the form of adirected acyclic graph-based ledger, built from transactions connected through time, by harnessing trust-basedalgorithms. Trust should be based on a combination of the network participant‘s historical behaviour data andobjective information about them.

COTI takes this into consideration, calculating trust using a unique machine-learning algorithm. Trust is used in theTrustchain Algorithm to validate and confirm transactions faster. Trust chains grow as new transactions attach totwo prior transactions which have similar degrees of trust as themselves. This results in an innovativeconsensus-based confirmation mechanism, where every user is incentivised to have a high level of trust whileengaging in trust-building behaviour due to the benefits associated with having a high level of trust (i.e. fasterconfirmation times).

COTI has built mechanisms to monitor, detect and defend against possible attacks, ensuring network security. Anexample of such a mechanism is COTI’s Double Spend Prevention (DSP) Nodes. COTI also introduces novel protocols toaddress disputes that may arise when sending transactions, a much required feature which is not possible with othercryptocurrencies. Dispute resolution is achieved by the use of an Arbitration Service. This service takes advantageof the principles of game theory to ensure a fair outcome in the case of a dispute and votes to determine which ofthe two disputing parties is right.

Our vision of COTI is to empower users to freely exchange value as simply as information is exchanged on theInternet. To achieve this, we are developing the Trustchain Protocol based on a directed acyclic graph (DAG)distributed ledger, which creates a scalable blockless protocol that can be utilised by any industry that needs highthroughput and trust to operate.

COTI is uniquely positioned to provide the infrastructure needed for industries requiring immense scalability, inaddition to an arbitration mechanism to resolve disputes, fraud (e.g. double spending) and errors.

COTI also introduces a MultiDAG structure and high-performance smart contracts, which provide a multitude of toolsfor enterprises, merchants, governments, developers and stable coin issuers.

Features & Highlights

At the core of COTI’s infrastructure lies the Trustchain, a proprietary consensus algorithm based on machinelearning, which dramatically decreases transaction costs and increases processing speed by assigning trust scores totransactions and clustering it in chains.

The Trustchain lies on a multi-DAG (directed acyclic graph) data structure, which works in tandem to drive upscalability, processing over 100,000 transactions per second (TPS). Our technology stands to revolutionize cryptoadoption by becoming the base layer upon which future decentralized solutions are built.

• One-click payment requests
  • Payment request is COTI’s unique solution for one-click payments, which can be embedded directly intomerchant websites for easy checkout.
• Arbitration service and buyer-seller protections
  • COTI has developed an Arbitration Service that offers dispute resolution through a decentralizedcollective of highly trusted network participants.
• Node manager
  • COTI’s node manager enables anyone to join the network as a node operator and to run all types of nodes.
• Privacy
  • Privacy is a standout for COTI, meaning transactions cannot be tracked back to a specific user, as amulti-address is implemented for each transaction by a one-way hash function.
• Proof of Trust (PoT) consensus
  • COTI’s DAG-based decentralized ledger achieves scalability through its use of parallel source selectionand Trust Scores. The higher a user’s Trust Score, the faster the confirmation time.
• Fees
  • The COTI network uses a transparent and equitable fee model, which guarantees that all fees aredistributed and balanced between network participants.
• Trust Score Update Algorithm (TSUA)
  • Designed to efficiently collect data on user behaviour and to relay the information to decentralizedTrust Score Nodes. Trust Scores are used by the Trustchain Algorithm to validate and confirmtransactions faster.
• MultiDAG
  • The COTI MultiDAG ecosystem is similar to Ethereum, as a common decentralized infrastructure is thebasis for a multitude of tokens, smart contracts and one native coin for paying fees.
• Smart contracts
  • COTI is introducing decentralized on-chain smart contracts for the DAG, which is a first of its kind.All smart contracts are recorded in the COTI MultiDAG Cluster and are verified several times by variousFull Nodes before confirmation.
• Stable coin framework
  • The COTI MultiDAG, together with COTI smart contracts and the possibility of multiple genesistransactions, allows for the creation of high-performance stable coins.