Auctus Project - Smart Contract Powered Pension Funds
The ambition behind Auctus is to create a pension fund platform on Ethereum blockchain, utilizing Ethereum smart contracts to automate processes, increase transparency and ultimately reduce operating costs of pension fund in a substantial way. The Auctus platform will be a global smart contracts-based platform for pension funds, designed to adapt to different legal and regulatory standards. With smart contract auditable code, the platform will ensure full transparency and compliance to the fund rules and allow calculations for contributions, employer matching and benefits, as well as provision of a variety of other features, such as investment profiles, beneficiaries designation (in case of death), administration fee calculations and portability between funds. The idea is to have a fully integrated platform as illustrated below:
Pension Fund Characteristics Coded Into Smart Contracts
Characteristics of the pension fund plan, such as retirement benefits, minimum contribution time, deferred compensation withdrawals (including rollovers, early distribution, lump sum distribution and hardship withdrawals) will all be stated in the smart contracts. In the case of an employer-sponsored plan, the contribution match calculation and vesting rules will also be established in the smart contract code.
Specific smart contracts will be created for every different pension fund plan. Process automation of collecting
contributions and payment of benefits will reduce administrative costs to the fund, making it more flexible and
Information Transparency and Choice of Investment Profile
Due to the transparent nature of the Auctus Platform, users will be better informed about the characteristics of
their pension. It will be possible to create different investment profiles with different allocation limits, according
to a participant's preference.
Ability to Allocate Funds
Participants will have the guarantee of being able to move some, or all, of their pension funds under the terms
defined in the smart contracts and will be protected by the immutability of the smart contract.
Automated Triggers and Pension Fund Transfers
The retirement grant can be automatically triggered when a participant fills the requirements of the plan. Also,
with Auctus, a participant can define the beneficiaries who will receive the resources in case of death, calculated
according to rules defined in smart contracts, which will, in turn, facilitate family succession planning.
No Hidden Fees
As for the management of resources, all investment allocation limits and fee charges will also be established in
smart contracts, making it impossible for investment managers to deviate funds and charge hidden fees.
Usually, pension funds charge administration fees on contributions, or fund assets, but these fees will also be
defined by smart contracts, eliminating the possibility of hidden fees, which is a common problem of investment
Auditing and Risk Management
Blockchain creates permanent records of all transactional activities, allowing regulators and participants to
easily audit processes of pension funds that use the Auctus platform, preventing fraud and possible losses due
to mismanagement of resources.
The Auctus Platform will also have improved risk control and performance measurement across assets,
designed specifically for pension administrators and to allow all parties to monitor it.
Governance mechanisms will be designed to allow greater member participation in the control of the allocation
of resources, establishing, for example, the vote in an election of the members of the board, or to approve
investment policy changes.
Summary of Advantages
* Full transparency allowing participants to make better informed retirement decisions
* Transparent fee structure, no hidden fees
* Fully automated processes that signicantly lower operational costs
* Easily auditable and easy compliance verication
* Resistant against fraud and full traceability
* Faster/more automatic retirement processes
* Easier and faster portability to other pension funds
- Multiple plan options with transparent rules
- Different investment profiles
- Flexible drawdown
- Lump sum withdrawal (pre- or post-retirement)
- Transfers to other pension funds (pre-retirement)
Once the platform is established, there are various monetization scenarios. Regardless of the monetization
scenario, fees and commissions will be uniquely paid in Auctus Tokens (AUC), making the token an integral part
of the Auctus Platform.
All fees charged by the funds, using Auctus’ platform, will be automatically processed by smart contracts and a
percentage of these fees will be collected by the platform. Auctus will charge approximately 20% of the fees the
funds charge to the participants. This percentage value will be negotiated between Auctus and the funds and
be stated in the smart contracts.
Smart Contract Customization Services and Fund Set-up Fees
Initially, no smart contract customization fees will be charged, in order to facilitate initial adoption by traditional
funds. However, as the number of funds running on the Auctus platform increases, the development of customized
smart contracts will be part of Auctus’ monetization model. In addition, there will be a fee for the creation
of new funds, even for those using default smart contracts.
An annuity is an insurance product that is designed to provide a stream of income to an individual. The primary
difference between an annuity and a pension fund is that anyone can buy it. It is also possible to supplement
income from a pension by buying an annuity, or even use the funds from a pension to buy an annuity that might
have better terms.
An individual can buy into an annuity fund and then arrange for the details of the annuity contract, such as the
length of the annuity and/or whether the payments will be fixed or vary based on how well the fund is growing. For
example, an individual can buy an annuity that would pay out for the rest of their lifetime, or one that could pay for
25 years, with the payments going to the individual's spouse if the primary beneficiary dies before the term ends.
Ethereum Smart Contracts are an ideal solution to fully automate annuities and have the potential to revolutionize
the annuities market, digitalizing all contract aspects of annuities. Auctus will build an annuities marketplace which
will allow insurance companies to sell annuities to the general public. There will also be an integration into the
pension fund platform, to allow participants to check their eligibility and to purchase annuities from insurance companies
in an easy and transparent way.
Customers interested in the purchase of an annuity will compare available offers from top-rated insurance companies.
After comparing and choosing the appropriate type, the respective annuity could be purchased in two different
ways: as a lump sum or with a series of premiums. The moment that a purchase is executed, all contract rules
will be recorded in the blockchain.
Monetization of the Annuities Marketplace would most likely be by commissions. Typically, commissions between
1 and 8% are charged, depending on the complexity of the annuity.
The team behind Auctus has been following the latest crowdsales (or initial coin offerings - ICOs) to gain
perspective and learn from mistakes and successes. One recurring point of discussion and problem, as pointed
out by investors, is that some companies are cashing out fundraised Ethers (ETH), right after the token sale
and placing downwards pressure on ETH’s price.
We believe our potential investors don’t wish to see us offloading all the ETH raised right after a sale ends.
The success of our project and mission of bringing pension funds to the blockchain relies on the Ethereum
network and the Auctus members strongly believe in the potential of this technology. We see this problem of
ETH offloading as unhealthy for the market and also economically disadvantageous for our project. We
believe in the long-term valuation of ETH and don’t see a reason to keep the company money that will be used
to cover development, marketing, operations and other costs in fiat currency until the moment of actually
The Auctus Token Sale will be carried out through Ethereum smart contracts, and the token can be
purchased only by sending Ether to the contract address. To address the problem of the offloading described
above, the token sale smart contract will include a rule to lock the ETHs. Ethers will be released on a gradual
basis, according to our business budget plan. At the end of a token sale, we will be able to transfer only a
small part of ETH for the initial costs; the rest will be locked by the smart contract. We will provide the token
sale smart contract address a few days prior to the start of the sale. This way it can be audited and viewed
by the community. The contract will periodically unlock a defined amount of ETH allowing us to use it to trade
it for fiat currency, if necessary. In addition to solving the offloading problem, this gives security to our investors,
demonstrating the team's commitment to the project.
The token sale will be divided into two phases: a pre-sale and the ICO. Prior to both phases, registration will
be required. We will use a process of email confirmation to create a whitelist of Ethereum wallet addresses, to
guarantee participation in the token sale process, without the need to rush and spend a lot of gas.
The first (pre-sale) will be directed to early supporters with a 25% bonus. From the total funds raised at
pre-sale, a maximum of 1000 ETH will go towards necessary expenses such as initial business set up costs,
PR and marketing services, explainer video and prototyping. Funds exceeding 1000 ETH will be locked by
smart contract and attributed to the ICO fundraising.
Tokens issued during the pre-sale will not be transferable and will be converted to the Auctus Token (AUC)
after the second phase (ICO) ends. In the second phase, the ETH raised will be locked as described above,
and then gradually unlocked as defined in the contract schedule to be used according to our budget plan.
Token Sale Summary
- Total Minimum cap: 15,000 ETH
- Hardcap: 90,000 ETH
- ETH accepted only
Token Presale Phase
- Mandatory registration for whitelist
- Individual Cap: 10 ETH
- Starts: October 3rd, 2017 at 2PM GMT
- 72 hours sale only
- Whitelisted addresses will have guaranteed participation
- Minimum cap: 400 ETH
- Up to 1000 ETH raised during pre-sale phase will be used for the initial business set up, PR, marketing services, explainer video and prototyping.
- Funds exceeding 1000 ETH will be locked by smart contract and attributed to the ICO fundraising.
- Token Price: 2500 AUC / ETH (25% bonus)
* Presale participants will be able to convert presale tokens with the ICO smart contract
corresponding function as soon as the ICO period ends.
Auctus Initial Coin Oering
- Equal, daily updated, individually-assigned purchase cap for all registrants
- Whitelisted addresses will have guaranteed participation
- Starts: November 14th, 2017 (TIME TO BE ANNOUNCED)
- Ends: November 28th, 2017 (TIME TO BE ANNOUNCED) or when maximum cap is reached
- Token Price: 2000 AUC / ETH
- Tokens will be immediately transferable after the Token Sale ends
- Raised funds locked by smart contract
* The smart contract will be revealed a few days before the ICO, allowing auditing of the locking rule.
* This is intended to make a responsible ICO and prevent ETH offloading. Revealing the contract
* early will help to avoid funds being sent to an incorrect address.
* All funds raised will be locked during the ICO period. At the end of the ICO period, the contract will
* allow up to 20% to be transferred in the first month and 5% in the following months.
Raised Funds Locking by Smart Contract
Token Allocation Summary
Auctus Core Team (20%)
20% of AUC created will be allocated to Auctus’ Core Team (founders, early backers and the development
team) for a long-term alignment of interests.
Vesting: 2 year vesting with 6 month cliff. This means tokens will not be immediately tradable and 25% of our
tokens will mature every 6 months.
Public Contributors (51%)
51% of all tokens will be distributed during presale and ICO. Resources raised in those distributions will be locked and become transferable monthly to be traded (if needed) to cover Auctus expenses for at least two years, possibly more.
Reserve for future Stakeholders (18%)
To allow for possible capital raises in the future, 18% of tokens will be reserved for future stakeholders. This
decision was based in the study of other technology projects and startups. This stakeholder reserve will be
locked via smart contract for 12 months. It will only be used if there is a need, or opportunity to accelerate the
growth of the company. This reserve can be used for strategic partnerships, to encourage the adoption of the
Auctus Platform and the provision of capital in case of excessive devaluation of ETH. If deemed unnecessary,
these tokens will be burned.
Partnerships and Advisory (9%)
9% of tokens are allocated for presale partners and advisors.
Vesting: 6 month vesting, with 3 month cliff. This means they will mature 50% of their tokens at the end of the
third month, and the rest at the end of the sixth month.
2% of tokens are allocated for bounty campaigns to help us spread the word about Auctus: Bitcointalk Signatures,
Bitcointalk Translation, Facebook, Twitter, blog articles, media publication, thread support, etc.
Token Sale Summary
Auctus Platform advantages table