MILE has been listed on Bitforex at $1.70 per coin, yielding a market cap of $1.7B USD, based on one-billion coins in circulation. It is a deflationary coin with a low 0.01 MILE transaction fee, tied to a stablecoin, XDR that offers free transactions. In what many people may consider a saturated stablecoin market, XDR may be a better solution to cross-border commodity trades, investments and payments in emerging markets.
George Goognin, a board member and global ambassador for the Mile Unity Foundation has stated that the coins will also help to reduce social tension among unbanked individuals. Goognin believes that Christine Lagarde, the Managing Director and Chairwoman of the International Monetary Fund (IMF) has become more positive about blockchain adoption at the government level, making the market primed for this new solution. Goognin said, “We support this idea and we’re already well-connected with governmental and supranational organizations around the globe. We’re always ready to help people to use Blockchain Technology for cross-border trade, investment and remittance.”
Goognin has been working since he was nine years old. He began in Russia, selling pens to willing takers on the street. He learned new skills, and worked as a software developer by the time he was fourteen. In 2008, he put together a team for Rusavtobus, a start-up public transport search engine.
Goognin’s path eventually led him to become the managing partner at a digital agency. Clients included online banks, fintech companies and others. In servicing these clients, Goognin considered their processes and technologies to be outdated, He did not accept that they were wealthy, while other smart people were not. He later needed capital and applied for loans, but was rejected by 23 banks. He saw this as an opportunity for a new startup to facilitate peer-to-peer (P2P) SME loans on a global scale, an industry that is projected to grow to nearly half-a-trillion dollars in loans by 2022, according to Allied Market Research.
Despite being turned down by the banks, Goognin launched a P2P fund for SME loans in 2014, which grew to $5M over three years. He then co-founded Karma, a global cross-border P2P lending platform, after speaking with influencers in the cryptocurrency community. The Karma team raised $500k USD in August 2017, and another $10M in December 2017.
While researching and authoring the project’s white paper, Goognin realized that a stablecoin was necessary for success. This led him on a quest for a good, decentralized algorithm, and he was introduced to Lotus Mile in Q4 of 2017. This anonymous community presented him with a new consensus algorithm that fit the needs of the project. The team tested it, utilizing a public network of thousands of nodes. After nearly a year of testing, the Mile Unity Foundation was founded to formalize a way to educate governments and enterprises on using the platform.
According to Gognin, most stablecoins require bank accounts with fiat deposits to back a centralized, digital record of deposits. In his view, this is risky for investors, since the investments become subject to regulations and could potentially become frozen. In addition, Goognin’s team determined that most stablecoins are built on older, slower platforms like Bitcoin and Ethereum.
XDR is pegged to Special Drawing Rights (XDR, or SDR), rather than a fiat currency that is subject to more externalities. The International Monetary Fund allocates IMF XDR to member nations. As these units are not circulated in the money supply, they are not subject to fractional reserve banking or other factors that influence their value. With no fiat assets or centralized organization controlling the supply, the XDR stablecoin is similar to Bitcoin, as a completely decentralized, algorithm-based asset.
XDR was designed to be used in a real economy, rather than as a high-volume, volatile asset that people trade, often based on emotional decisions. With the resulting stability, Goognin expects XDR to be ideal for cross-border commodity trade, investments and money remittance. With no company tied to the coin, XDR is uncensored and can be used anywhere. Contrast this with SWIFT, which blocks payment transfers to certain countries and companies, or BIS, which accepts payments from just 60 countries out of nearly two-hundred. Goognin stated that XDR/MILE pilot programs are planned in Japan, Uganda, Turkey, Kazakhstan, Russia, and the Republic of San Marino, and that BRICS, G-Global and the Silk Road Association have all agreed to partnerships using the MILE ecosystem.
Zhou Xiaochuan, the Governor of the People’s Bank of China (PBOC) stated that physical cash may become obsolete, and that PBOC is considering digital currencies that are faster, cheaper and more convenient than other payment methods. His concern is that cryptocurrencies like Bitcoin are too speculative, and don’t serve the economy. Goognin contrasted this with the XDR stablecoin. He said that XDR is a “useful tool for the real cross-border trade, investment and remittance, so we believe it would be welcomed by the Chinese business community.”
As with proof-of-stake models, MILE/XDR stakeholders earn interest on their coins over time. However, MILE blocks are signed and validated at random by one of the 10,000 master nodes, making it harder to manipulate the market, according to Goognin. He considers the truly decentralized nature of the two coins as the greatest driver for the model’s success. The Mile Unity Foundation is similar to the Bitcoin Foundation, in that it is not an owner or author, but rather, an NGO that served as the first backers of the coin.
The group plans to launch a nonprofit NGO in the US at some point, to gain access to grant money from organizations like the Gates Foundation, Rockefeller Foundation or World Bank, which have allocated funds for projects that help emerging markets with financial inclusion.
Goognin believes that equal access to P2P loans, cross-border payments, settlements, investments and money remittance in emerging markets will reduce friction among different peoples. He sees MILE and XDR as a cure for radicalism that stems from poverty and a lack resources like financing, energy, food, and water. In this way, the Mile Unity Foundation hopes to shape culture for the better.