The KoreProtocol is a specification for designing KoreContracts and KoreSecurities. It includes a comprehensive set of factors for the design of digital securities.
The KoreProtocol provides maximum flexibility by taking into consideration factors such as jurisdictions of the issuer, exemption(s) under which the Digital Securities Offering is made, investor accreditation and verification, investor suitability and risk profiling, reporting and disclosure, trading, transfer, blue sky laws, exit, mergers, acquisitions, voting or non-voting, tag along/drag along rights, dividends, revenue share, royalties, options, warrants, beneficiaries, custodianship, etc.
The KoreProtocol has four modular layers: Public Interface, Business, Process, and Governance.
The Public Interface Layer handles all data access interactions and APIs for communications with external parties and other KoreContract instruments.
The Business Layer contains information about the terms and conditions of the digital securities offering and the functions of digital securities throughout their lifecycle. This layer includes information and rules pertaining to securities law, corporate law, and other rules as defined by the issuer.
The Process Layer contains information about end-to-end processes for management of transactions, events, and the complete lifecycle of digital securities covering issuance, secondary trading, and corporate actions.
The Governance Layer handles compliance, risk management, and audit. This layer contains functionality such as disable, enable, stop, shutdown, restore, restart, notifications, and escalations.
Benefits of the Koreprotocol for Ecosystem Stakeholders.
For Issuers: Meets all regulatory requirements in all jurisdictions where digital securities are offered.
For Broker-Dealers: Ensures that Issuers are conducting legitimate securities transactions and that investors are protected, properly managed, and reported.
For Secondary Market Operators: Allows a seamless, frictionless trading bringing together investors, security holders, issuers, broker dealers, and transfer agents.
Getting Started Process
A KoreContract is a specification of any legal contract that includes identifiable parties, legal intent, and mutual consideration. It is implemented as an automated process. It enables the representation of various types of contracts such as securities, warrants, bonds, options, directors’ resolutions, NDAs, loans, etc. A KoreContract contains those features that are common to all contracts, such as type of contract, parties to the contract, applicable dates, jurisdictions (for performance and arbitration), triggers, and various terms and conditions. The KoreContract specification consists of the public interface layer, business layer, process layer, and governance layer. In particular, the process layer ensures that the KoreContract can be managed throughout the lifecycle of the contract and not just for point-of-time transactions.
KoreProtocolContracts and KoreProtocols
A KoreProtocolContract is an example of a KoreContract that is used to represent and handle securities. KoreProtocols are units of transactions that are derived from a KoreProtocolContract. Due to the complete modular and layered infrastructure of both KoreContracts and the KoreChain, KoreProtocols provide many benefits to the participants of the private capital markets ecosystem.
The KoreChain is a private & permissioned blockchain built on Hyperledger Fabric, goes beyond the usual blockchain capabilities such as distributed ledger, cryptography, and consensus. It consists of 40 capabilities in seven layers, from the ‘bare-metal’ blockchain infrastructure to ecosystem management to functional capabilities.
Essential Characteristics of KoreChain
- Completely focused on the issuance, trading, and lifecycle management of fully-compliant tokenized securities in global private capital markets
- Includes support for the entire ecosystem of participants in private securities
- Safety and security are paramount; includes multiple moats for security and hosted on Level 4 of NIST’s FIPS 140-2 servers (the highest level of security)
- Decoupled from cryptocurrency
- Includes artificial intelligence/machine learning for design, contract execution, governance, risk management, and data analysis
- Validations and consensus is flexible, adaptive, and dynamic in real-time
- KoreContracts are based on legal foundations and have true intelligence (i.e., they are true ‘smart contracts’)
Advantages of KoreChain
- Highly secure with recourse to resolving faulty transactions
- No forking or hijacking the chain
- Less attractive to crypto-thieves and bad actors (since it is not tied to cryptocurrency)
- No economic waste and no environmental impact (since there is no PoW mining)
- Economics of securities transactions is not commingled with cryptocurrency economics
- High performance of several thousand transactions per second
- Modular architecture for pluggable cryptography, consensus, and data store
- Channels for secure and private transactions