A Breakdown of the ThinkCoin Whitepaper Pt 3/6


A Breakdown of the ThinkCoin Whitepaper

Pt 3/6


Success Determinants
The success of the TradeConnect network is dependent on:
·         The user base of the network
·         How fast the transactions are settled
·         Maintaining an optimal liquidity that will ensure all transactions are executed and matched instantly.
Hybrid Approach
The blockchain has its own limitations that will affect the success of transaction done on the system. Assuming each buying and selling is giving a contract on the blockchain, a large number of transactions done using ethereum will be needed regardless of the fact that the trade was accepted by the counterparty. This approach described above will lead to delays in the whole system, therefore, increasing the time before a transaction is completed.

Transactions Off-chains
Tradeconnect proposes a way of overcoming these challenges that pose a threat to swift transactions on blockchain and this solution involves the creating and storing of contracts off-chain, this makes the settling of price-making and liquidity-matching transactions a matter of seconds. This approach will lead to the aggregation of profits and losses as one big transaction onto the ethereum blockchain and then spread across the system.

Hybrid Approach and Centralized Trust
Both private blockchains and centralized models experience similar fates, a scenario where the data can be changed and there is a sole signer. TradeConnect will change this approach by giving signing rights to a group chosen from the pool of Oracles that determine prices on TradeConnect.  In the beginning, several oracles will act as price makers and will give a mid price for markets; an expected expansion in the network will lead to an election system that will help oracles choose a fair mid price that will give everyone on the network equal opportunities.
The Search for the truth
In any fast-growing market like FX trading and cryptocurrencies, sometimes due to risk perception, liquidity and volatility market markers might pull their offers and bids.  This will lead to an irregular spike in prices, liquidity gaps, increase in the cost of buying and selling finally resulting in a loss for the trader. Allocation of a mid price for each market by oracles will create a price that other makers will trade with thus creating a fair mid market price for all participants.
TradeConnect network roles
The roles of participants in the TradeConnect network are classified into two - Subscribers’ and ‘Providers’. These participants can be individuals, traders or institutions
The Subscribers include:
Makers – the terms of the contract that will be used in buying and selling of a particular financial product is created by makers. A ‘Maker’ might be an individual or trading entity.
Takers – Can check the contracts on the table and can accept the terms of the contract by signing them with their private key.
The Providers include:
TradeConnect Contract keeps the ThinkCoin tokens locked, allows the tokens to be traded by the participants and to settle trading is done off -chain.
Relays are created by market markers and it is an off -chain store where buying and selling are done.
Oracles will present transactions made off chain to the smart contract
Liquidity – Using the Connect Fee to get balance
When buying and selling are carried out using a TradeConnect contract, a small percentage will be paid on the trade in TCO, this small percentage paid is referred to as the Connect Fee. Participants pay this fee when a trade is executed using the network and this fee is equivalent to fees and charges that are paid during buying and selling for example commission.
The amount of the fee to be paid depends on the kind of product being traded; also the size of the trade will be considered when smart contracts are drawn by the network. Market makers will get a percentage of the connect fees as the fees will net out through the blockchain. This netting out is done mainly to reward and encourage participants that give trade opportunities to other participants; the gesture of these parties will aid the continuous liquidity in the network.
Personas in motion
Personas will continue to experience growth, it will become smarter and improve the time a transaction is completed, also as the volume of buying and selling increases and as the number of participants in the system increase, it will provide data that will shape personas development in the future.
Trade Quality Persona
This model will study the relationship between a specific trade and a given financial instrument over a period of time that could stretch a lifetime as long as the subscribers remain active.
Price-matching Persona
Participants in the network have to trade with traders that will help them earn the highest during the spread throughout the system and also handing them a trade with the lowest risk.

Check out the ANN page here and website here 
Personal Bitcointalk Profile

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