Up Token (UP) A cryptocurrency ATM on every corner, worldwide.
Coinme, Inc. (“Coinme”) is a venture-backed crypto financial services and blockchain technology company. Launched in early 2014 in Seattle, WA, Coinme was the first licensed Bitcoin ATM operator in the United States. Since then, Coinme has grown significantly across the western United States. In addition to operating a network of crypto ATMs, Coinme has become a vertically integrated provider of digital wallets and an online digital currency exchange—which provide customers the opportunity to join the crypto financial revolution. As a fully vertically integrated company, Coinme offers a seamless user experience to our customers. We manage all aspects of the operation including kiosk hardware and software, state and federal licensing, regulatory compliance, real estate acquisition, cash logistics, and customer service. This gives Coinme the flexibility to provide our customers with an instant, on-the-spot fiat-to-crypto and crypto-to-fiat experience. Our ATMs eliminate the uncertainty, the technical difficulty, and the lengthy waiting period that online exchanges frequently impose on users. Today, Coinme’s crypto ATMs provide customers with an effortless financial transaction experience that eliminates the barriers to crypto-adoption for non-technical users. Our long-term vision includes bringing modern access to financial services to the billions of people who don’t have access to traditional banking services. Coinme and the crypto community believe that providing globally ubiquitous access to crypto ATMs has the potential to transform the world. From the developed to developing countries, Coinme firmly believes in and espouses its tenet: “In a crypto world, all communities can rise UP.” In order to accelerate Coinme’s vision of providing ubiquitous access to crypto ATMs, we would like to introduce a new crypto-asset, “UpToken.” The purpose of this whitepaper is to discuss how UpToken’s architecture plays an integral role in building a global network of crypto ATMs.
Crypto ATM Market
The amount of cryptocurrency in the markets today currently exceeds $100 billion in value. While crypto ATMs offer the simplest and most direct portal for consumers who want to instantly buy and sell cryptocurrencies, there are less than 1,600 crypto ATMs deployed worldwide today. Based on these figures and given the need for geographic accessibility, Coinme believes that there is considerable potential for the increased ability to use crypto ATMs across the globe. Furthermore, when compared to the over 3 million traditional ATMs currently deployed worldwide, Coinme sees the appetite for and usefulness of the new technology embedded in the newly invented UpToken for crypto ATMs as significant and timely.
Coinme believes the widespread international growth of crypto ATMs is a significant step towards providing a portal between government-issued fiat currencies and cryptocurrencies, enabling global access to innovation within the financial sector. In synch with this goal, we are launching a new crypto-asset, “UpToken” (symbol: UP).
UpToken will provide the following benefits to holders:
1 A 30% discount on ATM transaction fees when transaction fees are paid using UpToken; 2 A customer rewards program that returns 1% of an individual’s total ATM transaction amount back to them in the form of UpToken, much like cashback, or other similar rewards programs in other product markets; and 3 A customer voting protocol for having a community voice on new cryptocurrencies a customer is interested in having added to the ATM platform.
Crypto ATMs: The Infrastructure of the Future
Worldwide Access to Cryptocurrencies
A global network of crypto ATMs can significantly help spread the adoption of cryptocurrencies because the ATMs can provide easy access to secure, physical portals for buying, selling, and transmitting cryptocurrencies. We believe that global crypto ATMs could also pave the way for unbanked and underbanked consumers to access financial services in fragile economies and emerging markets. Similar to how developing counties leapfrogged landline technology with cellphone towers and smartphones, Coinme believes underserved financial segments in developing countries have the potential to leapfrog the absence of traditional banking institutions by choosing to use a crypto ATM and digital wallet as the gateway to participate in financial transactions.
The Coinme Difference
Since its inception in early 2014, Coinme has adopted a conservative approach by focusing exclusively on providing safe and secure crypto ATM services in Washington State. Over the years, we have become fully vertically integrated, managing all aspects of the operation including kiosk hardware and software, state and federal licensing, regulatory compliance, real estate acquisition, cash logistics, and customer service. Coinme is not a plug-and-play ATM operator; our engineers write all aspects of the software code, from the ATM firmware to the Coinme web wallet. Through the investment of significant time and capital in research and development, Coinme has developed what it believes to be a superior user experience. For example, when a customer buys Bitcoin at a Coinme ATM, the customer’s funds are deposited into a hosted Coinme wallet; Coinme’s service eliminates any need for paper wallets or third-party wallet applications, which can be confusing for new crypto users to understand and adopt. Coinme has found its crypto ATMs to be popular, and they continue to grow in popularity. Presently, Coinme ATMs are averaging almost $100,000 in monthly transaction volume per ATM. Coinme’s vertically integrated crypto ATM platform has been validated by thousands of customers and is now ready to be launched in other markets around the globe.
Average Monthly Transaction Volume per ATM
Contextual notes on the above graph:
• The chart is for illustrative purposes only and is solely intended to show that crypto ATMs have apparently been seen as useful in communities where they have been installed. This suggests that there may be appetite for the use of crypto ATMs globally. We think this also suggests that the UpToken may be immediately useful to token holders both in our established and new crypto ATM locations, both in the United States and abroad. • The periodic downward trends are largely due to the onboarding of new customers for recently deployed ATMs. There is a lag between deployment and customer adoption that temporarily lowers the average monthly transaction volume per ATM. Similarly, it may be expected that downward lags will accompany the deployment of new crypto ATMs in new jurisdictions or that have developing economies and limited financial resources. • Coinme’s crypto ATMs are currently buy/sell bitcoin for cash only. Coinme is currently considering adding other cryptocurrencies and payment methods (e.g., debit/credit card, Apple Pay, etc.), as well as potentially local payment methods in developing countries and other jurisdictions, which, together with the economic status of the jurisdiction and nature of consumer interest, may affect monthly transaction volumes.
How UpToken Fits with the Customer-Focused Mission of Coinme and Its Crypto ATMs
Coinme’s customers have high standards, and Coinme wishes to meet the expectations of its customer base. To that end, Coinme plans to continue to acquire new hardware, develop software to support new cryptocurrencies, integrate additional payment methods, and maintain the infrastructure, operational management, regulatory compliance, state and federal licensing, and other business-related activities that Coinme’s customers have come to expect. Coinme plans to have a broader network of Crypto ATMs located across the United States, with international deployments planned to begin in the middle of 2018 or later. Although Coinme may also enter other lines of business, its current focus is Crypto ATMs and its customers. The UpToken is a natural outgrowth of the customer-focused mission. As one more way to make a Crypto ATM useful to customers, and as part of Coinme’s recent and planned expansion of its suite of products and services, Coinme sees its new UpToken product as a potentially attractive fit for its ATM users. Coinme also intends to expand its product offerings. In the coming months, Coinme plans to add cryptocurrencies other than Bitcoin to sell and purchase from its crypto ATMs, as well as add additional payment methods. Coinme hopes that its customers can soon travel far and wide and find not only the convenience of our Crypto ATMs at hand, but be able to use UpToken to more fully enjoy the experience of being a valued customer.
Coinme Plans to Hold UpToken
Coinme plans to hold 25% of all UpToken created at this address: 0x052DE51fA8d105de1F38B177030F5536b192b176 (the “Coinme UpToken Vault”). Coinme does not intend to sell any of its UpToken in the Coinme UpToken Vault until it has deployed at least 500 crypto ATMs. At that point, Coinme anticipates that its expanded customer base may wish for more UpToken to be made available. During any one month, Coinme will not sell UpToken worth more than 20% of the UpToken distributed as loyalty rewards by the network in the previous calendar month. To illustrate, if Coinme’s ATMs distribute the equivalent of USD $1M worth of UpToken as rewards to ATM customers in January, in February, Coinme will sell no more than the equivalent of USD $200k (20% of $1M) worth of UpToken.
To keep in touch with its customer base, Coinme plans to publish regular communications on the UpToken website (www.uptoken.org) describing ongoing company activities, new ATM deployments where UpToken may be used, and an overview of future initiatives. Coinme will also publish the locations of our crypto ATMs and solicit feedback on potential future ATM locations. Furthermore, executive members of the Coinme team will be available for ongoing communication with UpToken holders who have questions, comments, and ideas about improving their customer experience or that they would otherwise like to share with the company.
UpToken: Benefits to Coinme Customers and Token Holders
Discounted ATM Transaction Fees
Customers will receive a 30% discount on ATM transaction fees if they choose to use their UpToken to pay the transaction fee. For example, if a customer purchases $1,000 of Bitcoin from a Coinme ATM and the ATM transaction fee is 5%, the customer could choose to pay the fee from their Coinme UpToken wallet, which would reduce the transaction fee to 3.5%. Coinme intends that customers will be eligible for the UpToken transaction fee discount immediately upon the purchase of UpToken.
UpToken Customer Rewards Program
Each time a customer uses a Coinme crypto ATM, Coinme will automatically deposit UpToken into the customer’s Coinme wallet equal to 1% of their ATM transaction amount as part of Coinme’s customer rewards program*, even if the customer elects to not use their UpToken to pay the transaction fee. Coinme may give customers UpToken from the Coinme UpToken Vault or, if it so decides in its discretion, a Coinme UpToken wallet which Coinme can replenish on an as needed basis by purchasing UpToken. Immediately upon receipt, customers will be able to use their rewarded UpToken towards transaction fees. If customers would like to purchase additional UpToken, they will be able to do so at any Coinme ATM once Coinme finishes its UpToken software integration. Customers will also be able to sell their UpToken at any of the Coinme ATMs for fiat currency under our ATMs’ ordinary terms. In addition to the 1% rewards benefit, Coinme may also reward customers with UpToken for use of the ATM network and other services.
Use UpToken to Suggest Which Cryptocurrencies Coinme Should Support
Over time, Coinme plans to add new cryptocurrencies to the ATM network. While it is impossible to know what the trending new cryptocurrency will be at any particular point in the future, Coinme plans to be ready to support its customers’ wishes, and plans to hold a UpToken vote for the opportunity to decide what cryptocurrency to add. UpToken votes for new cryptocurrencies will allow our customers and coin enthusiasts to have their voice heard in deciding which coins, and from which coin inventors and technologists, might become available on the crypto ATM network. Coinme plans to ensure that, as our customer preferences evolve, our cryptocurrency offerings will evolve as well. UpToken votes may be structured in several ways, but the current plan is to set up an UpToken address for each candidate cryptocurrency. For example, there could be an address for Bitcoin Cash, another for Litecoin, etc. Coinme plans that anyone holding UpToken will be able to send UpToken to those addresses to recommend adoption of their desired candidate cryptocurrency. When the election period is over, Coinme will take account of its customers’ wishes and, unless it finds the decision unreasonable in light of developments (such as that a candidate cryptocurrency becomes unusable due to unforeseen events), plans to begin a process of adding the cryptocurrency to become available on the crypto ATMs. The losing voters’ UpToken will be returned to the losing voters’ wallets. As for the winning voters’ UpToken, they will be deposited into the Coinme UpToken Vault. The winning voters’ UpToken that Coinme receives will be subject to the same restrictions as the UpToken in the vault as described in Section 2.4, as well as the additional restriction that the winning voters’ UpToken will be held in the Coinme UpToken Vault for at least five years after the election has ended. After the election, Coinme plans to fulfill its customers’ request by seeking to add the winning coin to Coinme’s network of ATMs in a commercially reasonable timeframe. All such elections will be publicly announced on the UpToken website: www.uptoken.org
Technical Design: Simple & Secure
UpToken is an Ethereum token following the ERC20 protocol. We will take a conservative design approach in order to minimize the attack surface that complicated smart contracts present to hackers around the world. Furthermore, we chose not to use an advanced contract token architecture to minimize the number of ways the token and token-holders can be attacked. Our token contract is available to view here www.uptoken.org/contractwww.uptoken.org/terms Note that the SHA256 hash of the crowdsale addresses is d8edce99c186da3b3ef0cd9c4c91722273534ab396f23f3bfc073f92b41d7f9e - this hash has been posted in numerous places for your protection.
Neil Bergquist, Co-Founder, CEO Neil is the former Director of Innovation at Delta Dental of Washington and a former Innovation Management Consultant at Point B, a consulting and venture advising firm with offices throughout the US. Neil also developed and led the largest technology incubator in the Northwest called SURF Incubator. Bergquist received a Master of Business Administration (MBA) from the Atkinson Graduate School of Management at Willamette University.
Michael Smyers, Co-Founder, Engineering As a serial entrepreneur, Michael brings a decade’s worth of experience and success to the team. In 2007, Michael co-founded Zipwhip (https://www.crunchbase.com/organization/zipwhip), a cloud-based texting platform, currently valued at $281M. In 2002, Michael founded CourseScheduler while completing a Bachelor of Science in Electrical Engineering from Kansas State University. Coinme is a testament of Michael’s ability to deliver on a dream.
J.R. Willett, Inventor of the Token Sale In 2013, J.R. invented the ICO by launching the Omni Layer (formerly Mastercoin) (http://www.omnilayer.org/). Currently, Omni is the 2nd largest ecosystem for crypto assets, hosting hundreds of millions of dollars (including Maid Safe and Tether). UpToken’s unique economics are the result of J.R.’s perspective and insight.
Brock Reed, VP Marketing Brock brings over 18 years of experience managing and running marketing and creative agencies. He feeds off energizing diverse teams in discovering, strategizing and executing successful marketing programs. He is a student of branding and understands the keys to successful customer loyalty. Brock has also started or been a founding partner in multiple businesses over the years from tech support to drinkware.
Juan Llanos, Chief Compliance Officer Juan has been a Certified Anti-Money Laundering Specialist (CAMS) since 2003. With over 15 years’ experience in building and managing AML and regulatory compliance programs for multiple international jurisdictions, including Canada, Italy, Hong Kong, Mexico, Singapore, the United States and Spain, Juan has been recognized as a pioneer in the development of compliance, operational and risk management best practices for the money remittances industry.
Steven Olson, Chief Financial Officer Prior to joining Coinme, Steve served as the interim CFO for multiple high-growth innovative financial technology organizations including Ripple Labs. He is a long-standing financial executive with over 25 years of executive-level management experience within technology-focused organizations.
Tokens. Company intends to create a total of 10,000,000,000 Tokens. Of those, 80% (i.e., 8,000,000,000) (the “Sale Tokens”) will be made available for public sale through the sale process described in these Terms (the “Token Sale”). A portion of the remaining Tokens, equal to 25% of the Tokens sold in the Token Sale, will be retained by the Company, and the remainder will be destroyed
Creation and Allocation of Tokens
1. Company intends to create 10,000,000,000 Tokens.
2. Of those, 8,000,000,000 will constitute the Sale Tokens available for purchase in the Token Sale.
3. An amount of Tokens equal to 25% of the Tokens sold in the Token Sale will be retained by the Company (the “Company Tokens”).
(a) The Company Tokens will be locked (cannot be sold or used) until a total of 500 Company ATMs have been deployed.
Once unlocked, Company reserves the right to use the Company Tokens for
any purposes at its sole discretion, including without limitation as
rewards to incentivize use of Coinme ATMs and Services; provided,
however, that in any calendar month, Company will not sell Tokens in
excess of 20% of the number of Tokens distributed as loyalty rewards in
the previous Calendar month.
4. Any Tokens remaining after the
distribution of the Tokens sold in the Token Sale and the allocation of
the Company Tokens to the Company will be destroyed.
Price; Purchase Currencies(a) Tokens will be priced in U.S. Dollars (“USD”).
The base price is $0.10 USD per Token. The base price will be subject
to a discount that will begin at 20% for Tokens purchased during the
first 24 hours of the Token Sale, and which will be reduced in
subsequent time periods. The following chart sets forth the resulting
USD price per token (the “Per Token Price”) that will be in effect for
each 24-hour period of the Token Sale.
Purchases totaling over $1 million USD will be subject to a discount of
30% for Tokens, if such purchases originate from a single
cryptocurrency wallet and are paid using one of the Purchase Currencies.
The 30% discount will be applied to the base price of $0.10 USD per
Token, resulting in an effective price of $0.07 USD per Token (the
“High-Volume Per Token Price”). The High-Volume Per Token Price is (1)
applicable and will be applied to all qualifying purchases throughout
the entire term of the Token Sale, and (2) not subject to, or combinable
with, any other discounts. Company reserves the right to provide
additional volume-based discounts.
(d) The following cryptocurrencies
(“Purchase Currencies”) can be used to purchase Tokens in the Token
Sale: bitcoin, Ethereum, XRP, Litecoin, and Bitcoin Cash.
Company will provide the address to which payments should be sent for
each Purchase Currency (the “Payment Address”) at a custom URL that
purchasers will receive after completing the Pre-Registration Form.
(ii) Company reserves the right to accept payment in other currencies on a case-by-case basis and at its sole discretion.
You will receive a number of Tokens equal to the USD value of the
Purchase Currency you send divided by the applicable Per Token Price.
Company will calculate the USD value of payments at the time received
by Company at the Payment Address for the Purchase Currency in question,
utilizing exchange rate data from coinmarketcap.com.
Company reserves the right to utilize a different exchange rate source
if, in Company’s reasonable judgment, the data available from
coinmarketcap.com appears to be inaccurate or manipulated. Such a
change, if implemented, will be communicated on the homepage of
2. Minimum Purchase Amounts
Company will not accept
purchases with a USD value of less than $100 (the “Minimum Purchase
Amount”). The foregoing notwithstanding, in order to protect purchasers
from price volatility during the sale, Company will accept purchases
equal to or exceeding the following amounts depending on the Purchase
Currency sent: 0.05 BTC, 0.6 ETH, 1000 XRP, 4 LTC, or 0.5 BCH.
3. Company Right to Void Token Sale If Purchases Do Not Reach $10,000,000
at the end of the Token Sale, the USD value of total purchases does not
exceed $10,000,000 USD, Company reserves the right to void the sale,
and refund all funds to purchasers. Refunds will be issued in the amount
of the Payment Currency in which you submitted payment. Refunds are not
calculated in the USD equivalent. For example, a customer who sends in 2
ETH to purchase UpToken will be issued 2 ETH as a refund, in the event
refunds are issued.
4. Token Sale Limit
(a) Subject to the
exception period described in Section 4(b) below, the Token Sale will be
halted once the USD value of purchases reaches $35,000,000 (the “Token
(b) The Token Sale Limit will not apply during the
first 12 hours of the Token Sale. Any funds confirmed as received by the
Purchase Currency network during that window will be included in the
Token Sale, even if the total of such purchases exceeds $35,000,000. The
only limitation during this 12-hour period is the 8,000,000,000 Tokens
available for sale.
5. Pre-Registration; Required Information
In order to participate in the Token Sale you must complete the
pre-registration form that will be made available by Company prior to
the Token Sale on UpToken.org prior to sending any funds to Company (the
“Pre-Registration Form”). In the form, you must specify:
(i) the type of Purchase Currency you will send as payment;
(ii) the network address, which you own and control, from which your payment will be sent;
UpToken is announced
Coinme launches 16 new Crypto ATMs
UpToken Sale Begins
Token Sale Ends (unless max is hit earlier)
30% discount on ATM transaction fees begins for UpToken holders (discount will be applied retroactively once the UpToken wallet is live which will be on or before 1.1.2018)
Coinme begins distributing UpToken equal to 1% of ATM volume
Coinme UpToken wallet goes live