Roxe White Paper

© Roxe Instant Settlement Alliance LLC, 2020

 

Preface

Apifiny has been developing the Roxe Global Instant Settlement Network for more than 18 months prior to publishing this white paper. Some network modules have proven their capabilities in commercial use, and our ecosystem is taking shape. In that way, this is a late white paper.

We are not promoting a chain, a protocol, or a token —  we are building a global value network.

We live in a world with more than 200 countries, more than 200 fiat currencies, tens of thousands of stock listings, tens of thousands of banks, hundreds of traditional asset exchanges, hundreds of public chains, thousands of tokens, and tens of thousands of digital asset exchanges. Each is isolated from the others—assets cannot be freely transferred between these fragmented markets, countries, and multiple centers. You can not buy an Apple stock outside the U.S. as easily as you buy an iPhone. In fact, it will take two days or more for your international remittance to be received. Goods and services can be easily transferred all over the world, yet there are many obstacles that need to be overcome in order to freely transfer value.

This is the Roxe network’s mission — Move Value Freely!

Free the value locked inside the world’s scattered and fragmented markets. 

Traditional settlement technologies process trillions of dollars in transactions every day — transactions that can one day be settled faster, with fewer intermediaries and at a lower cost. For example, DTCC processes trillions of dollars in transactions daily, SWIFT processes 5 trillion dollars daily, and CHIPS processes 1.5 trillion dollars per day. They are entrenched in the daily global transfer and movement of assets in the traditional financial world, and they all rely on legacy technologies — technologies that have been far surpassed by fintech innovations such as blockchain technology and distributed networks. 

Innovative applications of blockchain technology will play a key role in modernizing the ancient global payment and settlement system.

Roxe is a plug-and-play global instant settlement network built with advanced Distributed Finance (DeFi) frameworks and technologies. Roxe aims to connect scattered assets, markets, and systems around the world and free asset transfer from the friction built into financial institutions’ account systems. We will accomplish our goals with a global asset clearing and settlement network — an infrastructure that supports the free movement of value globally, enabling the world to exchange value as easily as it exchanges information.

In achieving our goals, we will have done nothing more than connect key stakeholders — banks, trading platforms, trading institutions, payment platforms, remittance companies, and even countries! More precisely,  the key stakeholders will have connected to one another.  

Let’s change the world together!

 

1. Overview

The global financial system includes a myriad of multiple currencies, systems, regulations, public chains, and markets that coexist but are not cohesive or built from the ground up for interoperability. The Internet connects these systems to each other, but the transfer of assets between them is still slow and costly. 

For example, three of the world’s largest clearing and settlement institutions — DTCC, SWIFT, and CHIPS are built on dated technology and are isolated from each other. DTCC is the world’s largest financial after-market service organization, providing custody and settlement of securities such as stocks and bonds. SWIFT is the world’s largest international inter-bank settlement system, operating a global financial messaging network. CHIPS is one of the world’s largest payment and clearing systems, primarily focused on clearing cross-border USD transactions. They are all dated, enormous, and isolated from one another. In order to make global asset transfer fast and reliable, the global financial system needs a unified clearing and settlement network.

Thanks to blockchain technology the financial account paradigm has evolved into the token paradigm. Free from traditional account systems, blockchain technology enables users to execute peer-to-peer direct value transfer between each other. In addition, blockchain technology has been used to digitize assets such as currency, securities, and commodities, and integrate them into tokens. With these building blocks in place, blockchain technology can also be used to build a unified global instant settlement network spanning across systems, asset classes, and markets.

Roxe is a global instant settlement network and financial infrastructure built with blockchain technology. It frees asset transfer from financial institutions’ legacy account systems, and it is designed to provide instant value transfer via digital proof of ownership across a wide range of assets.  It will provide instant settlement for currencies, securities, commodities, and other types of assets to power a global value circulation network across markets, regions, and asset classes through high-speed, open, and concise clearing and settlement services. This network enables banks, trading markets, and financial institutions to realize guaranteed, fast, and automated clearing and settlement directly with each other without relying on any intermediary parties. Any network node (e.g., a bank or trading institution) can transfer value instantaneously, minimizing the potential risk and friction from exchange rate fluctuations and from regional and business divisions.

The channel for value transfer is a dedicated hybrid blockchain, called Roxe Chain, that transfers “Proof Of Ownership” (Smart OP) on chain. Network settlement nodes act as asset custodians, and Smart OP transfers instantly. This Smart OP  travels at lightning speed on the network. Smart OP is an accounting tool, which reflects the account balances of nodes and members. Smart OP can be exchanged with the owned asset at any time.

While some blockchain entities are attempting to ‘solve all problems with one currency’, Roxe openly ‘solves one problem with all currencies’.

Roxe streamlines the transfer of value between the world’s major banks, financial institutions, and trading markets. Its visionary trade-clearing and settlement model leverages advanced blockchain technology to build a unique global asset instant settlement network. 

Note that throughout this white paper, Smart OP is also called “Proof of Ownership” The basic structure of Roxe is a dedicated hybrid blockchain, one for which the ‘transaction is clearing and settlement’, and Smart OP is the communication vehicle.

 

2. Why The World Needs Roxe

Some simple examples demonstrate the need for a global instant settlement network: 

  • A non-American would need an American brokerage account and US dollars to buy Apple shares; 
  • Remittance from the United States to Africa carries handling fees of up to 15%;
  • There are still 1.7 billion adults in the world who do not have bank accounts; 
  • An active cryptocurrency trader has to open accounts on multiple exchanges and reserve multiple positions — a problem not encountered by traditional equities traders

Today’s global clearing and settlement does not meet modern needs for value exchange. A comparison of the exchange of information to the exchange of value is instructive:.

Global Information Exchange: Today, the global exchange of information over the internet is robust and convenient. With one click, a user can find millions of relevant articles, images, videos, and more from global sources. Applications like Twitter and Facebook provide instant access to wide global audiences. 

Global Value Network: Meanwhile, despite advances in technology, the global transfer of value is far behind that of information. As the instantaneous flow of information has raised expectations, the high friction and fees associated with global asset transfer are more apparent to consumers and institutional finance professionals. This is true for both traditional assets and digital assets, such as cryptocurrencies.

The world is calling for a global value network that is as frictionless as the Internet. One that enables instantaneous value transfers and transactions globally, conveniently, and with much lower fees.

What is the biggest bottleneck in building such a global value network? First, let us take a look at the current state of global value transfer and settlement in traditional finance, digital finance, and cross-border finance.

The global financial system is a conglomeration of regional financial systems  — each including institutions such as banks, stock exchanges, currencies, markets, technology systems, public and private blockchains, and regulatory agencies.  The Internet connects these systems to each other, but the transfer of assets between them is still slow and costly. There is no unified clearing and settlement network in the world that makes asset transfer fast and reliable, especially for traditional finance, digital finance, and for cross-border finance:

 

  1. In traditional finance, different countries and regions are home to multitudes of global trading markets, banks, currencies, and financial institutions. These were established with disparate domestic regulatory rules and with infrastructures that are outdated today. These financial systems are neither global nor unified.

For example, the fiat currency accepted by banks can only be circulated within their domestic banking systems, not globally. Financial institutions and consumers in different countries, with different domestic fiat currencies, cannot effectively exchange value with each other.

Outside the United States, it is much harder to buy Apple stock than it is to buy an iPhone – barriers such as different currencies, different time zones, and the need for brokers, collectively create friction and slow the exchange of value. The global financial market is fragmented, isolated, inefficient, and even broken.

  • In digital finance, we see the potential for the nearly instantaneous exchange of value, but today digital assets cannot be easily integrated into the modern banking system. While many expected digital finance to solve the problems we see in traditional finance, there are instead thousands of digital currencies and public chains and disparate regulatory rules for different countries, even further fragmenting the global financial system.

There are currently more than 10,000 digital currency exchanges in the world, and the digital currency trading market is highly fragmented and isolated. BTC is listed on thousands of exchanges. In order to cover the complete digital currency trading market, active traders have to simultaneously access multiple exchanges and transfer funds between them. This requires traders to maintain accounts with multitudes of exchanges to access their respective order books. The impact is that traders need more capital and multiple reserve positions. This is a stark contrast with the market for Apple stock, listed on NASDAQ to create one unified market.

There is no unified clearing and settlement network mechanism or system between digital exchanges, or between digital asset exchanges and institutions, causing low trading capital efficiency — an undesirable consequence of the digital currency trading market’s fragmentation. Further exacerbating this problem is the time required for an on-chain BTC purchase or sale to be recorded on the blockchain. The average on-chain BTC transaction time is over five minutes — far too long to wait for a trader who is buying low on one exchange and selling high on another.

The solution, a coordinated clearing and settlement network mechanism or system between digital assets exchanges and institutions, does not yet exist.

  • In cross-border finance, international payments are the slowest, most expensive and most unreliable of all payment categories. On the surface, they are slow and expensive because they are subject to an obsolete and inefficient infrastructure that was established by each country before the advent of Internet technology. 

Fundamentally, the system requires a clearing and settlement network to accelerate transaction speed, reduce costs, reduce risk, and unleash a torrent of pent up demand. Today, agency banks are connected through a series of intermediary banks and central counter-parties. Each intermediary increases total costs, hinders transparency, and creates potential delays and points of failure. For example, a cross-border payment between entities in Japan and Brazil cannot be completed directly; it requires a US intermediary to first exchange Japanese Yen for US Dollars and then exchange US Dollars for Brazilian Reals with a bank in Brazil.

Financial liquidity is the cornerstone of the economy, and international economic partnership also requires sufficient liquidity. Currently, neither digital finance nor traditional finance has a global post-trading clearing and settlement between institutions (markets, banks, systems) — both of which are a financial necessity for international economic cooperation. Today, the lack of foundational infrastructure is the biggest bottleneck in the construction of global value networks.

 

3. Roxe Global Instant Settlement Network

The current global financial system lacks a clearing and settlement network that easily connects different systems to realize the transfer of assets. A clearing and settlement network is needed to eliminate barriers to efficient trading. 

Roxe is the solution.

Roxe, built with blockchain technology, is a Global Instant Clearing and Settlement Network that provides easy-to-implement API connections to instant settlement services for banks, trading markets, and financial institutions.

Roxe powers a robust global value circulation network across markets, regions, and asset classes through high-speed, open, and concise clearing and settlement services, so that banks, trading markets, and financial institutions can realize guaranteed, fast, and automated clearing and settlement with each other without any intermediary parties. Any network node (e.g. banks, trading markets, and even countries) can transfer value instantaneously, minimizing the potential risk and friction from exchange rates and from regional and business divisions.

The fundamental approach is to send and receive trade confirmations much faster, in milliseconds instead of minutes, by instantly transferring Ownership Proof (Smart OP) while the underlying assets are held in custody by a Settlement Node on behalf of the other network nodesSmart OP is is proof of ownership, which reflects the receivable books and account balances of nodes and members. Smart OP can be redeemed for the underlying asset at any time.

These vehicles travel on a lightning-fast hybrid blockchain, Roxe Chain. This approach is orders-of-magnitude faster than BTC for clearing and settlement. 

As a result, Roxe will provide a myriad of benefits for both financial ecosystem stakeholders and end-customers. Roxe’s global instant settlement network, built on a powerful post-trading, inter-bank, and inter-trading markets infrastructure, will support important use cases across a wide variety of institutions in the ecosystem, including banks, exchanges, institutional traders, non-financial institutions, and more. Value will be passed on to their end customers, as consumers and the public at large will enjoy a myriad of benefits, including faster and more reliable international payments, and better asset pricing with faster execution. 

The Roxe global instant settlement network supports three subsidiary networks: 

  1. Digital asset clearing and settlement network 
  2. Payment clearing and settlement network
  3. Pan-assets clearing and settlement network

 

Roxe Digital Asset Clearing and Settlement Network

Roxe Digital Asset Clearing and Settlement Network is a real-time clearing and settlement network that connects digital asset trading markets, helping exchanges provide their clients with instant deposit, withdrawal, and trading services across exchanges. 

For example, institutions will be able to execute global trading strategies that include buying on one exchange and immediately selling on another. These traders will gain immense increases in capital utilization, generating more transaction volume for exchanges, while reducing traders’ needs to maintain large positions with multiple exchanges. 

Traders use Smart OP (“Smart Ownership Proof”) in the Instant Settlement Network to quickly deposit, withdraw, and trade across exchanges. 

Exchanges can use the trading settlement network API for instant transfer of ownership for assets.. Exchanges and traders can convert Smart OP into the same amount of underlying fiat at any time, enabling self-serve, instant clearing and settlement.

Roxe Payment Clearing and Settlement Network

Roxe payment settlement network enables instant clearing and settlement between banks. It uses blockchain technology to enable banks and payment platforms, without intermediary service providers, to directly achieve guaranteed, fast, and automated clearing and settlement. Banks and financial institutions can provide their customers with instant cross-border payment services.

The remitting bank will instantly mint the fiat in the system and issue a Smart OP of the local fiat. The Smart OP will be automatically traded into a Smart OP in the recipient country and the receiving bank will automatically redeem that Smart OP instantly to the recipient. Minting, trading, and redemption can all be completed instantly.

Roxe Multi-asset Clearing and Settlement Network

We envision that the Roxe Multi-asset Clearing and Settlement Network will be a clearing and settlement network between traditional asset trading markets. Through blockchain distributed technology and Smart OP (smart ownership proof), it will enable broker-dealers to trade securities, commodities and other assets around the clock for their customers. The Multi Asset Clearing and Settlement Network also enables trades between securities, commodities, digital assets and different fiat currencies, shifting traditional asset trading from an “account paradigm” to a “token paradigm,” allowing global users to easily trade global assets. With the Roxe network, trades between Broker Dealers and institutions are cleared and settled instantly.

4. Roxe Blockchain

Overview

Roxe global instant settlement network is built on a hybrid blockchain that is the value transfer and communication channel across and between network nodes. Smart OP is the vehicle transferring proof of ownership, and therefore transferring value  and information. 

The blockchain, Roxe Chain (the Global Instant Settlement Network Chain), is a hybrid chain accessible only by network nodes. Roxe Chain will be dedicated to instantly clear and settle asset transfers between and among network nodes.

Roxe Chain and Smart OP

Roxe Chain is a hybrid blockchain that supports different public chains at a high speed, realizes fast and unified cross-chain operations, and provides functions such as cross-chain address binding, coinage, and redemption. 

Through Smart OP (Proof of Ownership), the value transfer vehicle, Roxe achieves high-performance cross-chain and cross-platform value exchange while providing professional support for asset accounting, transfer, settlement and payment.

Roxe Chain enables value transfer, supports closed smart contracts (as opposed to open smart contracts), and guarantees fast block packaging speed — a rare guarantee today.

Roxe, through blockchain technology, creates an immutable record of Proof Of Ownership transfer, or Smart OP, to build a value transfer channel accessible via lightweight and easy-to-implement APIs. This enables participants to access the network with low incremental technical costs and thresholds.  With low implementation costs and easy implementation, participants can quickly upgrade their operations, offer new solutions to their customers, pass savings on to customers, and even establish new business lines to outperform competitors.

5. Roxe Smart Ownership Proof (Smart OP)

“Smart OP” serves as  proof of ownership for assets across trading platforms, institutions, and borders in the Roxe network, and it is only used within the Roxe network. It is the vehicle that moves value and information between network nodes. 

Smart OP is an accounting tool, which reflects the account balances of nodes and members. Smart OP reflects ownership of assets held in custody by Roxe Settlement Nodes on a network participant’s behalf.. 

The Roxe Currency Platform enables node exchanges to create books and accounting records (proof of ownership) on Roxe Chain. 

Smart OP can connect assets currently spread across countless value islands, to create a global market and liquidity pool and realize cross-asset clearing within the instant settlement network.

With Smart OP (Smart Ownership Proof)”), nodes have access to buy and sell tens of thousands of assets at any time — a true ‘Internet of Value.’ 

 

6. ROXE ID

There are tens of thousands of banks, digital asset exchanges, and fintech companies around the world. To access each platform, users, especially institutional users, have to repeat complex and time-consuming KYC processes — including four hours on average to provide information and five working days to receive a response — six interactions and a total of more than twenty days are often needed to complete a KYC process, yet the onboarding failure rate is still approximately 30% 

RoxeID is a Roxe network pass based on the Roxe Chain. It is a common ID and account for the Roxe network common KYC. RoxeID helps to access all nodes within the Roxe network without repeating the KYC at different nodes.

RoxeID is essentially a blockchain-based, global in-depth electronic ID and account for individuals, companies, and organizations. It enables companies, banks, organizations, and governments to identify and conduct KYC processes on the Internet. RoxeID is better than business license, passport, ID cards, driver’s licenses, and other actual ID documents since it houses more of the in-depth information required to streamline the KYC process. It is a financial ID.

RoxeID, built on Roxe Chain, adopts distributed technology to be safe, credible, and irreversible.

RoxeID Platform is an OpenKyc platform where users register for RoxeID. Users can register their RoxeID and KYC just once to gain access to global international currency accounts.

RoxeID Platform is also a platform for network members to integrate RoxeID services.

RoxeID enables customers to instantly complete the onboarding process, so users can quickly gain access to additional network exchanges globally. 

 

7. Roxe Network Structure

Roxe instant settlement network connects and integrates network platform members, providing members with clearing, settlement, trading, custody, mint, redemption, transfer, and shared-KYC services.

Roxe has four categories of network nodes, each with different functions. Any institution can serve as more than one type of node, performing different functions for different types of transactions.

Settlement nodes

Banks, trusts, large compliant trading platforms, and operators provide custodian, minting, redemption and settlement services for all nodes in the network. 

As nodes, banks can improve the service quality of existing business lines and develop new products and business models, e.g., cross-border loans and pledges.

Roxe Currency Platform offers banks a platform to digitize proof of ownership for domestic fiat currencies, enabling banks to provide cross-border and domestic real-time payment services. Banks can directly access Roxe Currency Platform to mint digital fiat currencies.

Trading nodes

Exchanges, investment institutions, enterprises, etc., can all be trading nodes. Trading nodes provide the necessary infrastructure to provide clearing services for the entire network. 

However, trading nodes do not provide custodian service. Rather, they can represent clients for  value transfer via Smart OP on Roxe Chain. Exchanges can use trading nodes to acquire trading depth and access different asset classes and types. Trading institutions can establish asset allocation mechanisms, increasing capital utilization and reducing investment risks.

 

Payment nodes

Exchanges, banks, and payment companies can all serve as payment nodes.

Exchanges

Exchanges are payment nodes that can be delegated to mint and redeem by other nodes. Exchanges, as payment nodes, participate in more global trading opportunities, attract active global investors, increase liquidity, and provide trading customers with instant deposit and withdrawal and trading services across exchanges.

Banks and payment companies

Banks and payment companies can become payment nodes. Banks and payment companies can establish flexible and compliant payment channels, especially low-cost instant cross-border remittances, for customers. Instant settlement network provides powerful value transfer, conversion, and account management capabilities, enabling payment platforms to rapidly scale new business lines.

Service nodes

Service nodes are members that share in the benefits of Roxe without the responsibility to provide the clearing, custody, settlement, payments, or minting services delivered by the other three node types.

Any organization can register as a service node, share the network effect benefits, and directly improve its operations and services by accessing more liquidity and more asset types. For example, with Roxe, a company like Amazon can provide overseas sellers with instant cross-border payment services and multi-currency payment methods. Service node access is ideal for small trading platforms, market makers,  investors, enterprises, blockchain project parties, and more.

8. Roxe Value Creation 

The Roxe ecosystem consists of all parties involved in the network, including countries/central banks, trading markets, banks, buyers and sellers, remittance payees, payment companies, financial institutions, trading institutions, and enterprises.

Roxe will not replace any existing clearing and settlement networks. Rather it will be a beneficial complement to each network. The Roxe Smart OP model brings significant benefits to nodes.

Countries 

Roxe  digitizes domestic fiat currency to circulate globally, increasing the domestic fiat currency’s global competitiveness by: 

  • Increasing the country’s ability to issue domestic fiat currencies
  • Facilitating the integration of domestic fiat currencies into the international monetary system 
  • Promoting the efficiency of domestic trade settlement and facilitating cross-border payments for enterprises and individuals 
  • Helping countries develop innovative financial systems by upgrading and building global financial infrastructures 

Trading platforms

Today, active trading institutions connect to multiple exchanges simultaneously to execute global trading strategies. Meanwhile, thousands of exchanges are isolated from the market. In fact, most trading platforms lack sufficient trading depth. As a result, more than 80% of the digital currency market requires market makers, forcing exchanges to pay significant fees and rebates to market makers and large customers respectively. Customer experience, cost structure, and business growth all suffer.

At the same time, competition between trading platforms is increasingly fierce, and virtually all trading platforms have set higher thresholds for withdrawals, handling fees, and benefits. As a result, margins for exchanges are declining.  

Roxe attracts additional active global trading customers to more exchanges and facilitate rapid deposits, thereby improving customer fund utilization and increasing transaction volume.

Roxe also facilitates business expansion for exchanges. The Smart OP model enables trading platforms to rapidly innovate and develop new services that support high-quality, popular assets while reducing technology development efforts.

Trading institutions

No platform exists today for trading institutions seeking to execute advanced global strategies. Instead, professional trading organizations must each build and maintain proprietary cross-market systems suitable for digital assets — exhausting valuable time and resources. As the cross-markets system connects with more exchanges, the cost of position management, API maintenance, and market capture increases further. 

Roxe helps trading institutions establish enterprise-class cross-market trading infrastructures. Benefits include: 

  1. Faster fund deposit and withdrawal across exchanges – in milliseconds instead of tens of minutes. 
  2. Significant reductions in positions required across exchanges, thereby increasing capital utilization for traders and reducing the cost and difficulty of adjusting their positions.

Roxe’s powerful infrastructure facilitates efficient and seamless asset transfers, helps trading institutions easily allocate assets across the entire network, and provides a wider range of investment opportunities.  

Enterprises

Enterprises can increase the speed and reduce the costs of global payments via the instant settlement platform. Capabilities and benefits include:

  1. Low-cost, instant cross-border payment
  2. Cross-border financing
  3. Thousands of payment options and currencies

Payment costs can be significantly reduced with Roxe’s more efficient cross-border payment infrastructure. At the same time, Roxe enables multitudes of payment methods, ensuring that enterprises can respond quickly to market changes and better support service localization. Roxe cuts customer acquisition costs, increases user loyalty, and improves competitive positioning. For example, with Roxe, a company like Amazon can provide overseas sellers with instant cross-border payment services and multi-currency payment methods. 

Banks

Banks have the potential to achieve the greatest benefits from the Instant Settlement Network. The ‘instant’ design enables banks to access the network without large-scale transformation, eliminating the need to upgrade complex BIS and business systems. Banks can even acquire new services and capabilities indirectly through other nodes. 

The valuable benefits for banks include:

  1. Increases customer acquisition and deposit growths
  2. Provides end customers with real-time cross-border payment services
  3. Reduces settlement costs
  4. Performs the cross-border settlement function faster and less expensively

Banks can significantly expand their service ranges and reduce costs by accessing the Instant Settlement Network.  Banks, especially newer ones, can quickly organize and build new business lines without building or overhauling complex infrastructure.

Payment platforms

Enterprises that access the Instant Settlement Network can support global instant payment with 100+ currencies. Benefits include:

  1. Enables new, diverse payment options
  2. Reduces settlement costs
  3. Facilitates new cross-border services 
  4. Supports new business models, such as B2B payments or letters of credit via smart contracts

These benefits are particularly pronounced for new businesses, such as online game recharge services. The number of companies distributing games worldwide continues to increase, bringing new challenges and opportunities for payment companies. 

Remittance companies

Remittance companies are saddled with high payment channel costs and long settlement cycles. The efficiency and cost of cross-border remittances in the traditional financial system have reached their peak, Roxe will be the next source of efficiency and innovation. The Lightning Settlement Network will help  Remittance companies:

  1. Provide customers with real-time cross-border payment
  2. Reduce internal remittance costs and end-customer pricing
  3. Increase service and innovation capabilities
  4. Improve remittance success rates 

Roxe improves business efficiency, reducing operating costs while improving customer experience.

9. How Roxe Builds Network Effects

Many successful Internet technologies, including the Internet itself, have built network effects that increase the value for all members/users as the number of members/users increases. As these markets have flourished, efficiency has increased, participants have achieved higher returns, and user experience has improved exponentially.

Roxe Instant Settlement Network will expand with the cooperation of key ecosystem participants such as trading markets, banks, and cross-border payment institutions.  Founding Roxe Association members and early network members will be the starting points for the network effects. 

As more exchanges join, and their collective liquidity pool grows,  more orders across all exchanges will be successfully executed, faster, and with better pricing — collectively, member exchanges are stronger together than they are alone. Institutional traders will increase their capital utilization, enabling them to increase their daily trading volume. The exchanges achieve higher volumes, and traders generate higher profits.  While banks and cross-border remittance companies already provide cross-border remittances, each will gain more opportunities to reduce expenses and increase settlement speed for more transactions as more participants join the network.

Roxe’s network effects will directly benefit institutions and indirectly benefit their customers:

  • Roxe Digital Assets Clearing and Instant Settlement Network will serve the digital asset trading market and trading institutions and will not directly serve retail traders.
  • Roxe payment Clearing and Instant Settlement Network will serve banks and financial institutions and will not directly serve individual or corporate end customers.

Regardless of their business segments, all connected participants will use the ROXE APIs to establish a two-way channel between local assets and Smart OP.

10. Major Advantages

Unlike others in the market that plan to ‘solve all problems with one currency’, Roxe openly ‘solves one problem with all currencies’

A dedicated blockchain, ‘trading is clearing and settlement’, and Smart OP together form Roxe’s foundation.

Roxe streamlines the transfer of value between the world’s major banks, financial institutions, and trading markets. Its visionary trade-clearing and settlement model leverages advanced blockchain technology to build a unique global asset Instant Settlement Network. 

The major advantages include:

Business expansion 

Roxe’s core logic is exceptionally concise. It is lightning fast, with easy-to-implement APIs, and can be quickly and seamlessly connected with the trading market, banks, and financial institutions. Roxe’s solution uses blockchain technology to facilitate transfers in and out of the modern banking system, and simultaneously simplify the settlement between banks. 

Roxe’s trading-settlement technology and robust APIs are the foundation of an instant and easy-to-use product. It is even easier for participants in digital currencies, trading platforms, and investment institutions that will only need to perform a simple docking to gain step-change increases in liquidity along with access to more asset types. 

Institutional traders, with higher utilization and global execution capabilities, will execute more trades, increasing trading volume for the market as a whole. Exchanges will also be able to offer new services, further increasing topline even.

Banks, remittance companies, and payment companies will settler payments faster at dramatically lower costs. Profit margins will improve, even as savings are passed along to end-customers. With access to more currencies and streamlined clearing and settlement, banks, remittance companies, and payment companies will be able to quickly and efficiently innovate and offer more solutions for their end customers.

Liquidity-driven value creation

By mirroring and integrating market assets in the form of Smart OP, Roxe provides participants with two-way asset liquidity – for both buyers and sellers; makers and takers. As more nodes join Roxe, liquidity increases for all participants. 

At the same time, the network rapidly converts various assets into OP in the value network directly. Trading platforms, investment institutions, and financial derivatives service providers can all increase the assets and orders available across the entire network. Smart OP, instead of the underlying fiat currency, is moved and transferred instantaneously within the value network, eliminating the limitations of the underlying assets,  technology, and/or business. With zero impact on existing business systems, Roxe unifies disparate asset pools, dramatically improving liquidity and capital utilization. 

Trading platforms, traders, and crypto-asset holders will all benefit from superior execution, pricing, and circulation speed.

Reliable services

Unlike the existing clearing and settlement solutions in the market, Roxe eliminates the risks and uncertainties caused by exchange rate fluctuations leveraging Smart OP. The Roxe model is also independent of the value system of digital currencies and fiat currencies. The instant settlement platform itself does not provide value conversion. The conversion between assets is implemented by nodes. The Instant Settlement Network focuses on providing stable and reliable asset flows so that the value transfer mechanism is not affected by market fluctuations.

All Roxe settlements are based on real-time transactions. Each transaction is recorded, tracked, acknowledged, and queried in real time. A third-party audit company will audit and oversee all asset digitization. In addition to transaction tracking, third-party audits will periodically disclose data to the entire market and accept the supervision of all participants. Each node’s data must be independently audited to ensure the safety of network asset values.

 

Open and equal participation

Roxe is built on the philosophy that every participant should be treated equally. In the business system, all compliant trading markets, banks, and financial institutions can join the network freely to gain access to more asset types, more regions, and faster clearing and settlement. Each node can become both supply-side and demand-side participants in the value circulation system, based on their business needs, without regard to their scale, industry, or business features.

 

11. Security

Communication security

Roxe Chain uses a semi-closed network and uses access mechanisms for super nodes, candidate nodes, and cross-chain gateways. The access nodes must comply with the mandatory security control standards of the Roxewap protocol, and be regularly reviewed by the technical committee. They must pass the review in order to access and use the node. At the same time, the nodes require an IP whitelist and access policy to limit the direction and path of communication within the network, ensuring maximum security on the chain.

The Roxe system follows the principle of ‘trading is settlement’ and does not communicate directly with partners’ core systems. All requests are initiated by nodes through API calls to isolate business risks from nodes’ internal systems and  Data Security.

Roxe settlement data is encrypted and is only shared between the receiving and sending parties.

The following data types are saved and maintained by each node’s internal database, and the data is only accessible by that  specific node:

  • Transaction or participants identity
  • Required personal identification information for the transaction or participants, e.g., payment information, such as bill number
  • Additional metadata

 

Safety control standards

All settlement nodes (settlement service providers) connected to the Roxe instant settlement network must comply with the mandatory security control standards of the Roxe instant settlement network to ensure that the entire settlement infrastructure is fully compliant, secure, and safe. Every node must pass an annual audit by a third-party auditor to confirm it meets standards and to ensure continuous, secure, compliant operations. 

Mandatory security control standards include, but are not limited to: 

  • The network environment is partitioned according to functional characteristics — e.g., the management server, application server, database server, etc., are hierarchical and partitioned
  • The area boundary and the logical partitions perform port-based and IP-based access control strategy
  • An enterprise-level firewall is deployed
  • Mainstream security software is deployed 
  • User and password management and integrity checks 
  • Data security encryption
  • Incident emergency response mechanisms, etc.

 

Safety Guidelines

In addition to mandatory safety control standards, Roxe Instant Settlement Network will ensure that all settlement nodes implement higher-security control measures in accordance with the standards for enhanced safety guidelines, especially for financial institutions, exchanges, big enterprises. 

 

12. Compliance

Roxe is a software technology platform that will facilitate real-time global transactions between compliant local banks, exchanges, payment companies, and their customers.  

KYC/AML

Local licensed and compliant banks, exchanges, and payment company entities will complete local KYC / AML verification, fund transfer, and deposit and withdrawal operations, ensuring that local KYC / AML rules are strictly followed.

Each node can establish its own compliance mechanism to address its unique compliance needs. Thanks to the instant and transparent network, each node’s business is independent and transparent to other nodes. The network supports the real-time review of all transactions, and business participants will be able to conduct manual reviews, per their internal guidelines, to ensure business compliance.

Unlike some solutions on the market that solve the problem of intermediate valueUnlike some solutions on the market that solve the problem of intermediate value circulation by issuing an independent currency, Roxes mode is a fixed 1:1 ratio between a Smart OP and its underlying fiat currency. Also, the final consumption is automatically converted to underlying fiat on a 1:1 basis, avoiding auditing risks for the currency issued. 

In addition, RoxeID provides network members a more convenient and standardized shared-KYC service.  

 

Data privacy and protection

Roxe establishes a direct and secure connection between trading markets, banks, and financial institutions. All settlement data is sent directly between the relevant institutions, so no other third parties have access to the data. This design ensures that nodes can control the access rights and storage methods of customer data.

 

Outlook

Roxe is a robust, yet simple and lightweight global asset Instant Settlement Network, with blockchain technology as its foundation.  For post-trading and inter-institution settlement, Roxe connects the world’s major banks, trading markets, and financial institutions to enable global clearing and settlement in milliseconds instead of minutes. Roxe relies on a unique settlement mode — ‘trading as clearing and settlement’ — that uses Smart OP to enable dramatic improvement in the speed of value exchange globally, providing partners with a robust global value network. As more node members join the network, the benefits for each will increase, unlocking a new torrent of value for Members, participants, and their end customers.

About RISA (Roxe Instant Settlement Alliance)

RISA is operated by Roxe Instant Settlement Alliance, Inc, a subsidiary of Apifiny Group.

Apifiny is a trading network for inter-trading markets and post-trading. It connects global major trading markets and banks. Apifiny is committed to bridging the gap between various trading markets and banks, providing institutional traders with a best execution platform, and providing trading markets and banks with liquidity and clearing and settlement services.

For more information, please visit roxe.io.