TEuro: A Transparent Stablecoin for Social Good

[GENERAL] Name and surname of main applicant

Simon Redfern

[GENERAL] Are you delivering this project as an individual or as an entity (whether formally incorporated or not)

Entity (Incorporated)

[GENERAL] Co proposers and Additional applicants

Florin Duroiu

Tobias Wölk

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

4

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

No

[GENERAL] Summarize your solution to the problem (200-character limit including spaces)

A KYC’d non-anonymous Euro stablecoin showing the full ownership graph of the token. A first-of-its-kind ledger for public funds shows all legal entity names of the token senders and receivers.

[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?

Yes

[GENERAL] Please provide here more information on the open source status of your project outputs

We intend to and will continue to release our TEuro software repositories under the AGPL.

TESOBE has been releasing major code bases to github under the AGPL, MIT and Apache licence since 2011. (See https://github.com/OpenBankProject) 

[METADATA] SDG rating

SDG goals:

* Promote peaceful and inclusive societies for sustainable development, provide access to justice for all and build effective, accountable and inclusive institutions at all levels

- SDG subgoals:

* Ensure public access to information and protect fundamental freedoms, in accordance with national legislation and international agreements

* By 2030, significantly reduce illicit financial flows, strengthen the recovery and return of stolen assets and combat all forms of organized crime

* Substantially reduce corruption and bribery in all their forms

* Develop effective, accountable and transparent institutions at all levels

* Ensure responsive, inclusive, participatory and representative decision-making at all levels

- Key Performance Indicator (KPI):

* Total value of inward and outward illicit financial flows (in Euros)

* Proportion of persons who had at least one contact with a public official and who paid a bribe to a public official, or were asked for a bribe by those public officials, during the previous 12 months

* Primary government expenditures as a proportion of original approved budget, by sector (or by budget codes or similar)

* Proportion of population satisfied with their last experience of public services

[SOLUTION] Please describe your proposed solution.

An area where traceability is needed, perhaps urgently, is one that concerns all readers of this proposal: public money to be invested in projects for the good of the community.

The current lack of visibility into the use of public funds and foreign aid poses a significant challenge to communities in both “developed” and “developing” economies. Traditional financial systems (TradFi) and existing cryptocurrencies do not provide real-time insights, leaving governments, organisations, and citizens vulnerable to corruption and misuse of funds.

The primary aim of this project is to address the transparency and real-time tracking gaps in public fund management and similar areas.

Approach:

Our approach involves building TEuro, a non-anonymous and fully transparent stablecoin built on the Cardano blockchain. 

Currently, we can only rely on what decision-makers say they will do. We tend to conduct retrospective examinations to recognise fund misuse related to corruption, and in some cases it’s still difficult to pinpoint where exactly the money goes. 

This reactive approach comes into play once most of the damage has been done and can provide only a glimpse of the truth.

By leveraging Cardano's capabilities, TEuro will be able to validate identities and track public money, greatly enhancing the level of transparency and exposing illicit or misplaced financial flows.

TEuro will require up-to-date KYC verification before each transaction and will show the entire ownership graph of the tokens, creating an immutable ledger for public money. The real time monitoring of public funds and foreign aid would potentially decrease corruption.

The ledger will be widely accessible because individuals have the right to access information, especially information concerning them in some way. In this sense, the TEuro ledger will nudge us closer to Open Data.

TEuro will also benefit from this wide accessibility as it creates a fertile environment for creating a vibrant community network. The larger the network, the more effective TEuro will be in providing a holistic picture of money flows in Europe.

The off-chain components will be backed by our API software to create a TEuro Block Explorer API, further increasing Cardano’s visibility and expanding the user network.

By decreasing corruption and ensuring the correct allocation of funds, we hope to create opportunities for economic growth and increasing public involvement & awareness.

Target Audience:

The project engages a broad spectrum of stakeholders, including government agencies, non-profit organisations, anti-corruption entities, citizens, and anyone involved in or concerned with the allocation and use of public funds. 

Some examples of where we see Cardano’s TEuro making real change:

• Government departments and local authorities in charge of planning and executing public works and projects
• Governments disbursing foreign aid
• Charities trying to bring transparency to their operations
• Governments disbursing new types of government support
• International donor organisations that want to prove they are meeting their goals

TEuro provides a solution that enhances institutional accountability, reduces corruption risks, and ensures the efficient use of public resources.

Note: When ideating this project, our initial choice of platform was Cardano due to its functional, formal code base and overlapping values. However two years ago we got stuck with the Cardano implementation and have gradually worked on an Ethereum based solution. We now want to evaluate a port of our code to Cardano (preferred) to explore the feasibility of sidechain integration between Cardano and Ethereum.  

Demonstration of Impact:

The impact of TEuro will be demonstrated through:

• Transparency: The existence of an immutable ledger of public funds that can be traced with clarity.

• Accountability: TEuro will increase accountability in fund management, reducing the likelihood of corruption and misuse and enabling the early identification of same.

• Efficiency: Governments and organisations will benefit from more efficient and accountable allocation of public resources, leading to positive socio-economic outcomes.

• Community: TEuro’s functional value will grow as the community network surrounding it grows. 

Uniqueness and Importance to Cardano:

• First-of-its-kind Ledger: The Cardano blockchain will be home to TEuro’s public fund ledger, setting a precedent for similar stablecoins in the crypto space.

• More stablecoin variety. Cardano’s stablecoin ecosystem is still growing, and TEuro will be both a compliant stablecoin that drives institutional adoption, but also a tool for a specific niche in the market that isn’t being addressed.

• Institutional visibility. KYC-based tokens spark the attention of traditional institutions. TEuro will give Cardano more visibility with such institutions, including financial and regulatory institutions. 

• Overlapping values. TEuro aims to make positive change, aligning greatly with Cardano values. Cardano’s TEuro will demonstrate the network’s dedication to its mission and provide increased credibility, especially among traditional institutions.

• Global Impact: TEuro's impact extends beyond individual governments, contributing to a global standard for transparent fund management.

Benefits to Stakeholders:

• Governments: Enhanced accountability, reduced corruption risks, and improved public trust.
• Organisations: Efficient and transparent management of funds, fostering donor and public confidence.
• Citizens: Confidence in the responsible use of public funds, contributing to socio-economic development. Allowing commenting on transactions, giving the public a voice and allowing networks of values to emerge.

TEuro represents a solution that aligns with Cardano's commitment to transparency, security, and global positive impact. By addressing the transparency gap, Cardano will set a new standard for responsible financial practices.

[IMPACT] Please define the positive impact your project will have on the wider Cardano community.

Impact of TEuro on the Cardano Community:

Value to the Cardano Community:

• Advancing Cardano's Reputation: TEuro will contribute to further establishing Cardano's reputation as a blockchain platform that fosters innovation, addressing real-world challenges and bringing about positive global change.

• Increased Adoption: The success of TEuro introduces a unique use case, attracting attention and potentially increasing the adoption of Cardano in both governmental and financial sectors.

• Additional open source platform. Cardano developers will be able to leverage the traceability features to develop applications and build on top of TEuro in the future.

• Become eligible for enterprise and institutional projects. A large part of the market is deterred by crypto’s pseudonymous and unregulated nature. TEuro provides the foundation to create any traceable token to be used across various industries.

• Showcasing Cardano's Capabilities. The project serves as a showcase of Cardano's technical capabilities, emphasizing its suitability for developing transparent and impactful financial solutions.

Measurement of Impact:

• Engagement metrics: On a basic level, to gauge the sentiment of the ecosystem, we will look at engagement metrics. How many views, shares and mentions by the Cardano community and beyond? This provides a view into the level of interest and perceived level of impact.

• Adoption Metrics: Track the adoption of TEuro, initially by Cardano users and small organisations, then by governments and larger organisations, providing quantitative data on the growth of Cardano's ecosystem (user count, active user count, user growth, number of transactions, number of countries).

• Transparency Metrics: Measure the increased transparency and accountability in public fund management enabled by TEuro, showcasing the positive impact on governance and financial practices. E.g. Total value of inward and outward illicit financial flows.

Sharing Outputs and Opportunities:

• Community Reports: Regular reports detailing the progress – including videos and screenshots – and impact of TEuro will be shared with the Cardano community through official channels.
• Public Demonstrations: Conduct webinars, workshops, and public demonstrations to showcase TEuro's functionality, encouraging community engagement and feedback.
• Documentation & Open Source: Provide comprehensive documentation of TEuro's development, making the codebase open source on GitHub to make any changes visible and promote further collaboration within the Cardano community.

Community Engagement:

• Forums and Social Media: Actively engage with the Cardano community on forums and social media platforms to share updates, gather feedback, and address questions.
• Collaboration Opportunities: Encourage collaboration with developers and stakeholders interested in building upon or integrating TEuro, fostering a sense of community ownership.
• Aiken: Our use of the Aiken programming language should further engage the ecosystem and facilitate collaboration.

Long-Term Impact:

We expect the long term impact to be:

• Establishing Cardano as the go-to blockchain for social good;
• Less corruption in Europe and more community resources (Measurements include public expenditures as a proportion of original approved budget, increase in percentage of the public satisfied with public services, etc.);
• Wider adoption in other regions (number of countries where TEuro is being used).

The success of TEuro is anticipated to set a positive precedent for similar future projects on Cardano, showcasing the platform's adaptability and real-world applicability. This contributes to the overall growth, credibility, and influence of the Cardano community within the broader blockchain and financial technology landscape.

Regular communication, transparent reporting, and community engagement will ensure that the broader Cardano community is actively involved in – and reaps the benefits of – TEuro.

[CAPABILITY & FEASIBILITY] What is your capability to deliver your project with high levels of trust and accountability? How do you intend to validate if your approach is feasible?

To validate the feasibility of our approach, the team will:

1. Conduct assessments of the potential market, including gathering feedback from regulatory authorities, central banks, anti-corruption entities, and other similar institutions;
2. Confirm if alternative solutions exist for this problem, analyse the gaps;
3. Confirm if a similar solution has ever been ideated, identify the challenges in those projects;
4. Communicate with the Cardano ecosystem and gather feedback;
5. Use the tracer bullet and agile approach.

From a technical perspective, the team is experienced in agile practices and uses the tracer bullet approach to reach the determined objective. Open source development is at the heart of what we do and we have a strong track record in software development within and outside of the financial services world.

Members of our team have been working with governments, financial regulators, global development companies and banking institutions worldwide to deliver technology for social good for the past 13 years. In particular, Simon Redfern has already contributed to the ideation and implementation of new technologies in the European financial system. He pitched open APIs for transparency in banking in 2010, and this lead to the second payments services directive mandating banks to expose APIs to give customers more control over their data (Open Banking).

Our work with blockchain technology has focused on closing the gap between TradFi and Web3, combining decentralised oracles and our API technology to enable blockchains to directly access data held by banks.

In conclusion, we have the unique blend of knowledge regarding technology in financial services, regulatory compliance, and blockchain that is required to execute this project.

[Project Milestones] What are the key milestones you need to achieve in order to complete your project successfully?

User Research, Tech Selection, Smart Contract & Architecture Design 

• Research the industry and stakeholders, from initial users to long-term potential users;
• Conduct assessments with regulatory authorities and other stakeholders.
• Research the regulatory landscape to understand the opportunities and limitations;
• Component Map;
• Technology selection - determine which technologies are most suited for the project (consider Aiken, Lucid, Atala Prism, Open Bank Project APIs, etc.);
• Technological feasibility study;
• System Architecture Diagram;
• Data Flows;
• Analyse the ethereum PoC in solidity code to see how to port it to Cardano;
• Smart contract development.

Deliverables: Report, System Architecture Diagram

KYC Integration & PoC

• Connection to sample of KYC providers;
• Design basic UI;
• Implement a basic Proof of Concept for merging KYC data and linking the off-chain identity to the on-chain user. 
• Usability testing and debugging, reworking;

Deliverables:  

• KYC integration
• Basic UI

Community testing & feedback 

• Launch TEuro on testnets for community access;
• Collect feedback using forms through community forums and social media;
• Incorporate the community’s input;
• Finalise prototype.

Deliverables:

• TEuro mint/burn on testnet
• dApp on testnet (including KYC)
• Community feedback report
• Updated TEuro smart contracts

Final report, Whitepaper and Mainnet

• Gather data regarding community and user engagement;
• Create a detailed report outlining the project's journey, challenges, and successes;
• Produce a video presentation summarising key aspects of the project and showcasing the prototype;
• Prepare Whitepaper
• Consider preparation for Mainnet

Deliverables: 

• Whitepaper
• Final project report
• Project completion video

Regular communication and feedback loops with the Cardano community will be maintained throughout the process.

[RESOURCES] Who is in the project team and what are their roles?

Simon Redfern - Product Lead.

https://www.linkedin.com/in/simondavidredfern/

Simon is the CEO of TESOBE and founder of the Open Bank Project, the open source API platform for financial services. Simon studied electronic engineering in Manchester in the early 80's where he focused on real time programming and digital systems - and he subsequently worked as a software developer, architect, sysadmin and DBA on numerous web / mobile platforms. In 2010, he pitched open APIs in banking to a group of regulators, which was well-received and is now called Open Banking, active in several countries. A hacker at heart, Simon is also a composer and electronic musician and enjoys interdisciplinary creative collaborations. He is a keen supporter of open source and open data, believing they are a sustainable force for social good. He is @simsysims on Twitter.

Dylan Thiam - Project Manager

Head of Content and Research Lead 

https://www.linkedin.com/in/dylan-thiam

Dylan is a writer and researcher of financial technology initiatives, regulations, and trends. He has extensively contributed and managed projects involving Open Banking technology and regulation, and has been involved in projects addressing the application of blockchain to the financial service sector. 

Cristh Tejada - Blockchain Developer

https://www.linkedin.com/in/cristhian-tejada/ 

Blockchain Developer with experience in designing and implementing smart contracts on EVM Nertworks and Cardano blockchain. He’s responsible for technical development of TEuro, including architecting smart contracts with innovative features like transparent ownership graphs. Engaging actively with the Cardano community, he will incorporate valuable feedback during the testing phase. 

Florin Duroiu - Off chain development

https://www.linkedin.com/in/florind/

A seasoned Software Engineer, Technical Lead and hard-core coder, Florin advises on software architectures, building and ramping-up technology teams and products. He has extensive experience developing & shipping MVPs and scalable products and over 20 years software engineering experience, cloud technologies.

Tobias Wölk - APIs, Authentication, DevOps

Tobias has over 20 years of experience as a hands-on IT professional. He has participated in many open source software integration projects to satisfy business needs in health care, hospitals, telecoms and universities. Tobias has been involved in multiple projects since joining TESOBE, focussing on Open Banking API, security, authentication, Kubernetes and DevOps. 

Cardano Developer - Consulting / Coding

(Searching).

This developer will have experience with native coins and smart contract development.

[BUDGET & COSTS] Please provide a cost breakdown of the proposed work and resources.

Market Research, Smart Contract & PoC (Milestone 1):

Market Research: 7,000 ADA

Tech Research: 4,000

Smart Contract Development: 20,000 ADA

KYC Integration & PoC (Milestone 2):

Basic PoC dApp: 20,000 ADA

User Interface Development: 6,000 ADA

Optimization and Testing: 10,000 ADA

Community Testing and Feedback (Milestone 3):

Community Engagement: 10,000 ADA

Feedback Incorporation: 10,000 ADA

Final Project Completion Report and Video (Milestone 4):

Project review, Data Compilation and Analysis: 4,000 ADA

Report and Video Production: 9,000 ADA

Total Budget Requested: 100,000 ADA

Most of the budget will be allocated to team salaries – including technical development, marketing, and project management – with extra expenses for infrastructure and third-party services & software.

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

Cost Justification and Proportional Spending:

Smart Contract Development: The cost is justified by the complexity nature of developing smart contracts on Cardano. Developers will ensure TEuro security and functionality.

Testing and Debugging: Allocating funds for testing and debugging is needed for preventing potential issues that could arise in a real-world environment.

Community Engagement Events: Building community trust and awareness is vital for the success of TEuro. Funds allocated for community engagement events, including webinars and workshops, will enhance the project's visibility and adoption.

Comparison to Industry Standards:

The costs outlined are aligned with industry standards for blockchain development, smart contract creation, and community engagement initiatives.

Developer rates, testing costs, and event management expenses are in line with the skills and expertise required for the project's execution.

Value for Money Context:

Innovation: TEuro represents an innovative use case for Cardano, showcasing its capabilities in transparent financial solutions. The value derived from the creation of a groundbreaking stablecoin with real-time transparency justifies the project's costs.

Community Impact: The project's focus on community engagement and feedback mechanisms ensures that the Cardano community is actively involved in the development process. This value extends beyond the project's immediate scope, contributing to a more engaged and informed community.

Long-Term Benefits: TEuro's impact on public fund management and its potential adoption by governments and organizations provide long-term benefits to the Cardano ecosystem. The project's success sets a positive precedent for future initiatives, fostering growth and credibility.

In summary, the costs associated with the TEuro project are justified by the innovative nature of the stablecoin, the industry-standard rates for development and testing, and the emphasis on community engagement. The inclusion of a contingency fund reflects a commitment to proactive risk management, ensuring that the project represents value for money within the Cardano ecosystem.

[IMPORTANT NOTE] The Applicant agrees to Fund 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