KWARXS - "Fracturizing: Revolutionize, Evolve"

[GENERAL] Name and surname of main applicant

Sandro Gonzalez

[GENERAL] Email address of main applicant

sandro@kwarxs.io

Additional applicants

MLabs

[GENERAL] Please specify how many months you expect your project to last (from 2-12 months)

6

[GENERAL] Please indicate if your proposal has been auto-translated into English from another language.

No

[GENERAL] Does your project have any dependencies on other organizations, technical or otherwise?

No

[GENERAL] If YES, please describe what the dependency is and why you believe it is essential for your project’s delivery. If NO, please write “No dependencies.” .

No dependencies.

[GENERAL] Will your project’s output/s be fully open source?

No

[GENERAL] If NO, please describe which outputs are not going to be open source. If YES, please write “Project will be fully open source.”

To safeguard the operational success of the platform and preempt potential risks from unfair or abusive practices, we have opted to maintain proprietary rights over our repositories during the initial years of operation. This is a prudent measure to ensure the stability and security of the platform in its early stages.

As our platform becomes well-established and recognized, we are committed to transitioning towards an open-source model. This future decision to open source our code aligns with our core belief in transparency and collective participation, key principles that will guide our platform's evolution in the long term.

[METADATA] Category of Proposal

RealFi

[METADATA] SDG rating

SDG goals:

• End poverty in all its forms everywhere
• Ensure healthy lives and promote well-being for all at all ages
• Ensure access to affordable, reliable, sustainable and modern energy for all
• Promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all
• Build resilient infrastructure, promote inclusive and sustainable industrialization and foster innovation
• Make cities and human settlements inclusive, safe, resilient and sustainable
• Ensure sustainable consumption and production patterns
• Take urgent action to combat climate change and its impacts

SDG subgoals:

• By 2030, ensure that all men and women, in particular the poor and the vulnerable, have equal rights to economic resources, as well as access to basic services, ownership and control over land and other forms of property, inheritance, natural resources, appropriate new technology and financial services, including microfinance
• By 2030, build the resilience of the poor and those in vulnerable situations and reduce their exposure and vulnerability to climate-related extreme events and other economic, social and environmental shocks and disasters
• By 2030, reduce the adverse per capita environmental impact of cities, including by paying special attention to air quality and municipal and other waste management
• By 2030, achieve the sustainable management and efficient use of natural resources
• By 2030, substantially reduce the number of deaths and illnesses from hazardous chemicals and air, water and soil pollution and contamination
• By 2030, increase substantially the share of renewable energy in the global energy mix
• By 2030, enhance international cooperation to facilitate access to clean energy research and technology, including renewable energy, energy efficiency and advanced and cleaner fossil-fuel technology, and promote investment in energy infrastructure and clean energy technology
• Sustain per capita economic growth in accordance with national circumstances and, in particular, at least 7 per cent gross domestic product growth per annum in the least developed countries
• Strengthen the capacity of domestic financial institutions to encourage and expand access to banking, insurance and financial services for all
• Improve progressively, through 2030, global resource efficiency in consumption and production and endeavour to decouple economic growth from environmental degradation, in accordance with the 10‑Year Framework of Programmes on Sustainable Consumption and Production, with developed countries taking the lead
• By 2030, upgrade infrastructure and retrofit industries to make them sustainable, with increased resource-use efficiency and greater adoption of clean and environmentally sound technologies and industrial processes, with all countries taking action in accordance with their respective capabilities

Key Performance Indicator (KPI):

• Renewable energy share in the total final energy consumption
• Number of small investors in renewable energy production facilities

[IMPACT] Please describe your proposed solution.

Kwarxs bridges blockchain and real-life projects by providing a crowdfunding vehicle that enables fractional ownership of solar energy plants (the same technology could be extended to other projects), to later distribute part of the annual profits among investors. Both the investment and the profit sharing is done through transactions on the Cardano blockchain using ADA as a currency, and the proof of investment used to claim the investor's share of the profit is done via Cardano native NFTs.

The built protocol allows to do the following actions:

1 - Investment and NFT minting

In order to buy an NFT, a user first has to clear KYC with Blockpass. Once this is done, by clicking the "Buy" button in the website the following sequence is triggered:

• Using the connected address, a KYC status request is sent to Blockpass.
• If a successful response is received from Blockpass, a transaction minting the NFT and sending it to the connected address, and paying to the operator's wallet the price in ADA displayed on the website is built and sent to the user for signature. The signed transaction is then submitted to the blockchain and the NFT is minted.

KWARXS NFT

2 - Profit sharing

After converting the profit generated by the solar plant to ADA (or any other Cardano native token), the administrator deposits it into the profit sharing validator, an escrow script that locks them under the profit distribution rules.

A separate deposit is required for each collection of NFTs supported (at launch, there would be four collections supported for different sizes of investment), and the information about how much value (e.g how many Lovelaces) can be withdrawn by each NFT holder is attached as part of the deposit transaction.

3 - Profit distribution

Owners of the NFTs can use them to claim their share of the profit previously deposited by the administrator and locked in the profit sharing validator. There is no need to stake the NFTs to do so. To prevent fraud, every time profit is claimed, the NFT is atomically burnt and re-minted, updating a counter included as part of the token name.

[IMPACT] How does your proposed solution address the challenge and what benefits will this bring to the Cardano ecosystem?

Kwarxs is committed to pioneering the concept of fractionalized ownership and governance within the sustainable energy sector. This revolutionary approach will empower investors to share in the profits generated by solar power plants, thereby promoting active participation in the green revolution. It also fosters an environment for the investment community to directly contribute towards the establishment of new solar power facilities.

Our strategic objectives align with the broader aim to augment the proportion of energy derived from renewable sources. This initiative is not only central to Kwarxs' operational framework but is also crucial to the attainment of international climate goals. Such objectives are highlighted in the 2030 agenda and are aimed at a significant reduction in the world's carbon footprint.

With the long-term vision of reaching zero-emissions by the year 2050, Kwarxs is committed to playing an integral role in catalyzing the transition to cleaner, sustainable energy solutions. Through our innovative approach, we aim to make a tangible impact in the fight against climate change, while providing our investors with profitable, socially responsible investment opportunities.

[IMPACT] How do you intend to measure the success of your project?

The primary measure of this project's success is gauged by the installed capacity of solar energy, expressed in Megawatts, made possible by investments channeled through the Cardano blockchain.

A secondary, yet equally significant, success indicator is the quantity of individual investors, particularly from the smaller investor demographic, who partake in this investment opportunity. The emphasis here is on the ability of these investors to acquire fractional ownership of the solar farms, thereby democratizing access to renewable energy investments. These metrics, combined, serve to reflect our commitment to promoting sustainable energy and broad-based investor participation.

[IMPACT] Please describe your plans to share the outputs and results of your project?

We are optimistic about deploying Kwarxs on the Cardano mainnet within three months of securing the necessary funding. Significant progress has already been made towards this goal, with a targeted launch currently slated for the fourth quarter of this year.

Upon the successful launch of the project, our platform will be primed for investors to mint their Non-Fungible Tokens (NFTs). These NFTs will symbolize their entitlement to a fraction of the profits yielded by the power plants.

It's noteworthy that our operations are already underway with solar farms in Germany. Therefore, we can assure investors of profits, even in the first year of operation, calculated from the conclusion of the initial investment round. This assurance underlines our commitment to providing a secure and fruitful investment platform to our investors right from inception.

Progress, demos and promotional videos can be found in our YouTube channel https://www.youtube.com/@kwarxs.

[CAPABILITY/ FEASIBILITY] What is your capability to deliver your project with high levels of trust and accountability?

The Kwarxs team has been in the business of solar power for almost two decades, executing over 5.5GW of solar projects globally, encompassing various types such as rooftop installations, open land systems, tracked systems, carports, landfill projects, and even floating solar installations on water. Recently, the first solar project under the Kwarxs project was constructed and is already operating in Ribnitz, Germany, with the following specifications:

• Type: rooftop system
• Size: 76.4 KWp
• Grid operator: E-ON Edis
• Production per year: ca. 78,000 KW/h
• Remuneration: ca. €0.385 per KW/h
• Running costs: ca. €500.00 per year insurance (Allianz)
• Roof lease: Already paid until 2031
• Installed components:
• Modules: First Solar FA 275
• Inverter: Huawei KTL 33, KTL 30, KTL 12
• Rack: Wuerth
• Cable: Helu Solar Cable
• Annual yield: €30,000 per year

On the software side of things, the Kwarxs Team has a strategic partnership with MLabs, with whom we have been closely collaborating for the past one and a half year. Thanks to this productive alliance, we have built the User Interface and we have already deployed our project on the testnet.

The funds obtained in this Catalyst round will be crucial in propelling our project into its final phase. These resources will enable us to transition the project seamlessly from the testnet to the mainnet, as well as adding some further functionality. This signifies a key milestone in our journey, bringing us a step closer to realising our vision for a greener, more sustainable future.

[CAPABILITY/ FEASIBILITY] What are the main goals for the project and how will you validate if your approach is feasible?

The primary objective of this project is to amass an extensive portfolio of green and renewable energy resources. This portfolio will include solar power plants, bio-diesel refineries, and tree farms renowned for their high CO2 absorption capabilities, among others. Our aim is to offer practical and robust solutions to offset carbon emissions, thereby significantly reducing our collective carbon footprint.

Kwarxs has committed to establishing itself as the most significant utility project on the Cardano platform. Our strategy is designed to yield a sustainable, long-term passive income for all members of the Kwarxs community. We aim to achieve this through the continual development and refinement of our proprietary system and smart contracts. 

Our goal is to enhance their usability for a growing user base, thereby driving the project's impact and reach. In the future, we envision the Kwarxs-Dao Project to become entirely autonomous. It will be self-organizing via the Dao and contribute to ongoing decentralization efforts. 

This vision underscores our commitment to forging new paths in green energy solutions, utilizing the power of blockchain technology, and supporting our community through reliable passive income opportunities. We believe these efforts will position Kwarxs at the forefront of sustainable innovation, driving forward both environmental responsibility and financial independence for our users.

[CAPABILITY/ FEASIBILITY] Please provide a detailed breakdown of your project’s milestones and each of the main tasks or activities to reach the milestone plus the expected timeline for the delivery.

Milestone 1 (3 months after funding)

Deploy the current functionality of the Kwarxs application (investment through NFT minting, profit sharing and profit distribution) to Cardano Mainnet. To achieve this milestone, the following tasks will have to be completed:

1. Exhaustive integration testing: as the project transitions from a testnet deployment to a mainnet one, we need to make sure that everything works as expected and in a robust manner.
2. Security Audit of the Smart Contracts: performed by an independent team.
3. Infrastructure set-up / DevOps: setting up and maintain the server and the runtime components necessary to deploy the application on mainnet.

Milestone 2 (4 months after funding)

Extend the current functionality of the Kwarxs application with support for DAO voting. A decision on whether to build a simple DAO from scratch (smart contracts prototype is already implemented) or integrate with an existing service provider has not been made yet.

Milestone 3 (5 months after funding)

Extend the current functionality of the Kwarxs application with a utility NFT marketplace, where only whitelisted NFTs that have utility can be traded. The smart contracts are already implemented, but the necessary off-chain infrastructure and front-end still need to be built around it.

Milestone 4 (6 months after funding)

Display data relevant to track and monitor the operation of the solar power plants on our website via APIs that directly fetch the information from the transformers interacting with the source of energy generation.

[CAPABILITY/ FEASIBILITY] Please describe the deliverables, outputs and intended outcomes of each milestone.

Milestone 1 - Mainnet deployment

The outcome of Milestone 1 is a live website from which users can buy and mint NFTs on Cardano Mainnet and later on use those NFTs to claim a share of the rewards deposited by the administrator on a yearly basis.

Milestone 2 - DAO integration

The outcome of Milestone 2 is an extension to the website from which users can vote on matters concerning the evolution of the Kwarxs project.

Milestone 3 - Utility marketplace

The outcome of Milestone 3 is an extension to the website from which users can trade NFTs that has been previously been whitelisted as having enough utility (first by the administrator, and eventually by the DAO).

Milestone 4 - Data display and monitoring

The outcome of Milestone 4 is an extension to the website from which users can see and monitor data and statistics concerning the operation of the installed solar power plants.

[RESOURCES & VALUE FOR MONEY] Please provide a detailed budget breakdown of the proposed work and resources.

Milestone 1 - Mainnet deployment: ₳140,000

• Exhaustive integration testing: ₳30,000
• Security audit of the smart contracts: ₳70,000
• Infrastructure set-up and DevOps work: ₳40,000

Milestone 2 - DAO integration: ₳30,000

• Design: ₳5,000
• Front-end development: ₳20,000
• Integration testing: ₳5,000

Milestone 3 - Utility marketplace: ₳80,000

• Front-end development: ₳20,000
• Security audit of the smart contracts: ₳50,000
• Integration testing: ₳10,000

Milestone 4 - Data display and monitoring: ₳30,000

• Design: ₳5,000
• Front-end development: ₳25,000

Note: promotion, community engagement and other work will be done by the founders as much as possible. No additional funding is requested for these activities.

[RESOURCES & VALUE FOR MONEY] How does the cost of the project represent value for money for the Cardano ecosystem?

The value proposition of the project for the Cardano ecosystem primarily hinges on its potential to increase the network's utility and attract more participants to the ecosystem.

Here's how:

1. Enhanced Network Utility: By leveraging the Cardano network for renewable energy investments, the project adds another layer of functionality to the Cardano blockchain. It positions the network as a facilitator of environmentally conscious investments, further differentiating it from other blockchain ecosystems.
2. Increased Participation: By enabling fractionalized ownership of renewable energy assets, the project opens doors for a wider range of investors. This broadens the network's user base and potentially increases the demand for ADA, Cardano's native token.
3. Alignment with Global Trends: The project's focus on renewable energy aligns with global efforts to transition to a low-carbon economy, positioning Cardano as a leader in sustainable blockchain solutions.

In essence, while the project involves costs, it's expected to generate long-term value for the Cardano ecosystem by increasing its utility, fostering user growth, and aligning with global sustainability trends.

https://www.youtube.com/watch?v=6TewcCYi7r0

[IMPORTANT NOTE] The Applicant agreed to Fund10 rules and also that data in the Submission Form and other data provided by the project team during the course of the project will be publicly available.

I Accept