LUXCoin Whitepaper

Thursday, June 21, 2018
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COMMERCIAL WHITE PAPER V2.1 LUXCORE TEAM PLEASE READ THIS DISCLAIMER SECTION CAREFULLY. IF YOU ARE IN ANY DOUBT AS TO THE ACTION YOU SHOULD TAKE, YOU SHOULD CONSULT YOUR LEGAL, FINANCIAL, TAX, OR OTHER PROFESSIONAL ADVISOR(S). The information in this white paper may not be exhaustive and while we make every effort to ensure that any material in this white paper is accurate and up to date, such material in no way con- stitutes the provision of professional advice. LUXCORE does not guarantee, and accepts no legal liability whatsoever arising from or connected to, the accuracy, reliability, currency, or completeness of any material contained in this white paper. Investors and potential coin holders should seek appropriate independent professional advice prior to relying on or entering into any commitment or transaction based on material published in this white paper, which material is purely published for reference purposes alone. LUXCoins will not be intended to constitute securities in any jurisdiction. This white paper does not constitute a prospectus or offer document of any sort and is not intended to constitute an offer of securities or a solicitation for investment in securities in any jurisdiction. LUXCORE does not provide any opinion on any advice to purchase, sell, or otherwise transact with LUXCoins and the fact of presentation of this white paper shall not form the basis of, or be relied upon in connection with, any contract or investment decision.

TABLE OF CONTENTS 03 EXECUTIVE SUMMARY 04 WHAT IS LUXCORE AND WHY? 05 LUXCORE’S VALUE PROPOSITION 06 FEATURES OF THE LUXCORE BLOCKCHAIN 08 LUXCORE PRODUCTS 10 LUXCORE REVENUE STREAMS 11 TARGET MARKETS AND SEGMENTS 12 2018 TECHNICAL ROADMAP 13 HIGH-LEVEL FINANCIALS 14 LUXCORE TEAM 16 DISCLAIMER 2 LUXCORE WHITEPAPER V2.0 - 2018

Executive Summary This commercial white paper provides a detailed overview of LUXCORE Ecosystem and an insight to the commercial aspects of the business as well as the public blockchain commodity, LUXCoin. This aims to provide information about LUXCORE’s value proposition, the blockchain’s features, products and the revenue streams. It further looks at the roadmap, the organization and key drivers of the business. LUXCORE WHITEPAPER V2.0 - 2018 3

WHAT IS LUXCORE & WHY? Underlying technologies of applications we use and how LUXCORE’s open-source blockchain includes the ground- enterprises carry out their businesses are already being breaking, energy-efficient, ASIC resistant algorithm PHI1612; transformed by the advent of blockchain technology. Along the tradeable commodity, Lux Coin; Masternodes that act as with smart contracts, the world is in the process of moving to a network security and rewarding system; Smart Contracts; a trustless, paperless and secure economy, be it the transfer of and SegWit for improved transaction size and malleability. data, assets, legal contracts or even for entertainment. While Bitcoin led us on this revolutionary path, the landscape of The closed-source products, focused on service providers, blockchain technology has seen tremendous technological enterprises and institutions, include Parallel Masternodes advancement in the past few years with the help of many (PMN), LuxGate, PoS Enabled Web Wallet, DApps and innovative blockchain projects. blockchain implementation and consulting services. We have already seen the power of distributed ledgers as a LUXCORE will provide a set of unique protocols and tools for single source of truth: in financial transactions, improvement easy integration across businesses that requires secure intra- in network stability and consensus rules, decentralized treasury organizational blockchain or permissioned blockchain networks. systems, secure anonymous and private transactions of data, With its upcoming consulting arm, the company aims to set up, significant increase of transaction speeds, digital contracts, maintain, and improve such networks for organizations and DAOs, DApps and even cross blockchain communication institutions. systems. Other blockchain solutions take an Us vs. Big Business or Us But very few companies offer customizable and bespoke vs. Governments approach. LUXCORE’s blockchain solution blockchain solutions for end users, enterprise and institutions and IT Services are built to help all three parties by allowing that incorporate the best features of the current blockchains various levels of features and security for the user as required. while being industry agnostic. 4 LUXCORE WHITEPAPER V2.0 - 2018

FIRST OF ITS KIND SMART CONTRACTS | SEGWIT | PARALLEL MASTERNODES | LUXGATE LUXCORE’S VALUE PROPOSITION Privacy & Security Cherry-Picked Solutions While many of the blockchain solutions focus Each of the major blockchains in existence on individual user privacy and security through today has championed one or the other feature, cloaking or different forms of coin mixing, be it Masternodes, anonymous transactions, LUXCORE extends a superior private network Smart Contracts, or SegWit to expand their approach to security through LuxGate and use case. LUXCORE has cherry picked some of PMN which is encrypted via SAM protocol & these significant attributes and brought them i2pd technology. These products offer clients together under one ecosystem. a secure blockchain-based channel for data and functional transactions. Enterprise-Ready Scalable Ecosystem Architecture The number of private networks or permissioned blockchains that can be integrated through Apart from the security of private networks LuxGate and PMN are unlimited. Each of these running its own chain, by using LuxGate, chains could run a specific application or have a enterprises and institutions will be able to access specific functionality embedded. and run domain specific DApps or customized applications on their private networks. These can be deployed on location or on the cloud as per requirement. LUXCORE WHITEPAPER V2.0 - 2018 5

LUXCORE BLOCKCHAIN LUXCORE BLOCKCHAIN The word LUX is LIGHT in Latin. By offering a faster, more efficient, more secure and private transaction solution for individuals, institutions, and governments, LUXCORE sheds a new light on the mainstream usability of blockchains. LUXCORE’s PHI1612 presents the most efficient ASIC-resistant GPU mining algorithm, with faster hash rates and reduction of power and heat consumption by 10%. This is scientifically verifiable the details of which will be made available in the technical paper. LUXCORE blockchain features are available to end users at no extra cost. Anyone who uses the commodity LUX Coin can access the blockchain using LUXCORE wallets or mine to support the network and earn rewards. The security features of the blockchain are also available for everyone. As a hybrid chain that supports both Proof-of-Work and Proof-of-Stake, the chain is more secure than traditional ones. The seed nodes, full nodes, and wallets that are unlocked for staking, also provide further network stability. Specifics and Rewards There are three distinct ways for miners and commodity owners to be rewarded: Proof-of-Work (PoW), Proof-of-Stake (PoS), and Masternodes. PROOF-OF-WORK (POW) PROOF-OF-STAKE (POS) Conceptualized by Cynthia Dwork and Moni Naor Proof-of-Stake (PoS) is another form of achieving and coined by Markus Jakobsson and Ari Juels, PoW distributed consensus and validating transactions where was essentially a way to deter cyber-attacks. The ever- the creator of a new block is chosen in a deterministic way, ingenious Satoshi used this approach to create a depending on the weight and time of their holdings. distributed trustless consensus network by performing computations (mining) to facilitate transactions on the LUXCORE’s PoS 2.0 is a static reward system, not a blockchain. The computational difficulty in performing dynamic one. PoS system gives a static reward to all these tasks has an impact on the effort and time required, individuals staking, regardless of the amount of coins held and the “miners” performing the computational tasks are in the wallet. Those who hold more coins are rewarded rewarded for their effort. more often. This means having your wallet open and staking is a great way to increase your coins. LUXCORE uses PoW as a method for establishing the distributed trustless consensus network and to ensure A Lux Coin achieves maturity for PoS after being in an seamless transactions online unlocked wallet for 36 hours. Total Blocks: 6M PoS 2.0 Static Reward: Block Size: 4MB - From block 1 to 100,000: 2 LUX Instamine Protection: 500 blocks - After block 100,000: 1 LUX Block Rewards: 10 LUX 60% of the reward is for staking (0.6). 40% of the reward Block Time: 60 seconds is paid to the Masternode (0.4). Transaction Confirmations: 10 blocks Minimum stake age 36 hours Minimum Transaction Fee: 0.0001 No maximum PoS age 6 LUXCORE WHITEPAPER V2.0 - 2018

LUXCORE FEATURES LUX MASTERNODES SEGWIT Any computer mining LUX or staking LUX is considered a node Through the introduction of SegWit, LUX will separate or connection to the blockchain network. The more nodes, the transaction signatures. This is achieved by stripping the stronger the network. A Masternode is a 24/7/365 dedicated signature from within the input and structuring it to the end server connected to the blockchain network that further of a transaction. This ensures higher security as it prevents enhances the network stability and supports the LuxSend the receiver from intercepting and modifying the sender’s functionality. To run a Masternode, a user is required to have transaction ID in a bid to get more coins from the sender as the 16,120 LUX in a wallet. data is “detached” from the transaction. Masternode owners earn rewards for supporting the network With a current block size of 4MB and block time of 60 seconds, and providing the additional services. These rewards are called the addition of SegWit will effectively increase transaction size Proof-of-Service rewards. The Proof-of-Service payment comes and address transaction malleability issues currently plaguing from 40% of the Proof-of-Stake and are randomly paid to the blockchains. This will prove critical in the scalability of the Masternode owners. Currently the Masternode system is being LUXCORE blockchain. This paves the way for the introduction of rewarded 0.4 LUX and the PoS is being rewarded 0.6 LUX for Lightning Network in the future. every PoS block found. SMART CONTRACTS Enable the unification of blockchains through LuxGate and PMN. These Smart Contracts can be deployed directly from the wallet and can trigger cross-network transactions and tasks based on pre-defined conditions. This enables the technical scaling of the network to build Enterprise DApps on the LUXCORE chain. Smart Contract transactions will benefit from other features like improved scalability, privacy, low fees, and security. TRADING WALLET LUXSEND LUXCORE’s trading enabled wallet will let you stake your coins is a form of coin-mixing that provides an additional layer and trade them too! Exchanges are not the safest place for your of privacy. The coin-mixing service provided by the LUX LUX, and when your LUX coins are on the exchange, you will not Masternode Network will ensure trustless mixing of coins to receive any PoS reward. The trading wallet allows you to trade obfuscate their origin, wallet details, and addresses. LuxSend your coins directly from your wallet. also enables instant transactions. MULTI-SIGNATURES With a view on security in mind, LUX will have Multi-Signatures enabled. No longer will funds be under a single point of control or failure. This gives users yet another level of security while using LUX Coin. Here are some use cases of Multi-Signature Transactions: 1-of-2 Signatures can authorize the transaction. A couple may share a joint LUX account and have two separate signatures. Either of the two is sufficient to authorize a transaction. 2-of-2 Signatures A couple share a joint account, but both parties’ signatures are required to authorize a transaction, thus preventing one party from moving the LUX without the approval of the other. LUXCORE The number WHITEPAPER of Signatures can be asV2.0 large -as2018 needed to protect the account and allow for sufficient oversight. 7 For example, LUX development and business funds will be held in multi-signature accounts requiring 2-5 or 3-5 signatures.

LUXCORE PRODUCTS LUXCORE’s core products are closed source and will typically follow a licensing or subscription-based model. Core products along with blockchain features, such as Smart Contracts and SegWit, enable customers to create a single private sustainable ecosystem for their business needs. POS ENABLED WEB WALLET LUXCORE’s Web Wallet is the first and only PoS Enabled Web Wallet in the blockchain space that does not pool coins for staking. This product is now live and enables staking at 0% energy usage for the end user who does not have to leave their computer open. POS Our unique web wallet will remain free for LUX users and is available here: http://lux.poswallet.io/ PoS Enabled Web Wallet-as-a-Service will be licensed to other blockchain assets and providers in the market with customizations and service add-ons. The Licenses and Service options for the PoS Web Wallet-as-a-Service will be available for purchase using LUXCoin, thus adding value to the LUXCoin economy. LUXGATE is nothing short of a technological marvel in the blockchain space. LuxGate will allow communication between validated blockchains with the ability to perform advanced functions and tasks. In simple layman terms, LuxGate, with the help of Parallel Masternodes, acts as a cross-blockchain unifying bond between two different ecosystems. For example, the Bitcoin blockchain can engage with Ethereum blockchain or Monero blockchain or Zcash blockchain. PARALLEL MASTERNODES The enablement of this private network aims to address reliable and secure needs of enterprises and institutions. This feature is built on the revolutionary i2pd Technology and SAM Protocol thus enhancing LUX’s security capability. The Parallel Masternodes will only be available to verified and vetted business and government institutions and will act as a secure information gateway on the blockchain. Any function, wallet, or transaction on the Parallel Masternode will be encrypted with the ip addresses auto-changed. These wallets and transactions are invisible to prying eyes to meet institutional security prerequisites. PERMISSIONED BLOCKCHAIN DEVELOPMENT & CONSULTING SERVICES: LUXCORE will provide bespoke permissioned blockchain creation and customization services. With the help of LuxGate and PMN, these private networks will be able to communicate with similar chains and could have their own specific features, for example, a different transaction throughput or even a completely different protocol. This will follow the specific requirements of the customer and can have different features from the LUXCORE public blockchain. This will also provide flexibility to enterprise users and may be maintained and managed by the LUXCORE operational team as required. DAPPS LUXCORE will develop and deploy both free and freemium model DApps for the end users. These may be used in conjunction with the Smart Contract feature. Business DApps will also be developed considering possible requirements and needs of the enterprise users. These may be exclusive for a specific business and deployed directly on the private network. Custom DApp solutions and business application integration through PMN and LuxGate will enable cross network usage. 8 LUXCORE WHITEPAPER V2.0 - 2018

LUXCORE PRODUCTS LUXGATE & PARALLEL MASTERNODES FUNCTIONALITY & HIGH LEVEL USE CASES LuxGate will be able to interact with centralized functions (e.g. banking institutions) along with the PMN private network, which will act as an autonomous system on behalf of the function. LUXCORE will provide the required technology assistance and consultancy services to set up PMN and will support the deployment of the private network for private institutions. These networks will be centralized trustworthy environments and will be verifiable by the customer to validate legitimacy of the transactions. With the help of this functionality LUXCORE aims to disrupt the traditional banking transactional systems. LuxGate and PMN can work cross algorithm and will be system agnostic compared to other blockchain competitors in this space. A specific feature from a security perspective is the ability of LuxGate and PMN to strengthen two layers of differing safety algorithms to be unified at a combined strength level. LuxGate and PMN, together, enable the deployment of Permissioned Blockchains and support the interoperability between networks and chains. Permissioned blockchains are key to the creation of private networks for organizations with different features from the main LUXCORE blockchain. LUXCORE WHITEPAPER V2.0 - 2018 9

LUXCORE’S REVENUE STREAMS REVENUE GENERATION FOR LUXCORE FROM A PRODUCT LUXGATE & PMN SETUP AND LICENSING PERSPECTIVE IS LUXCORE plans to follow a licensing model for the setup of LuxGate and Parallel FROM THE Masternodes. Banks, businesses, and governments will be vetted before they can purchase a Parallel Masternode and LuxGate solution. Licensing cost will FOLLOWING include setup and maintenance costs which will be carried out by the LUXCORE SEGMENTS. operational team. PERMISSIONED BLOCKCHAIN CREATION AND CUSTOMIZATION LUXCORE will provide bespoke permissioned E-DAPPS blockchain creation and customization services. These will follow the specific requirements of the customer Another key offering from LUXCORE are and can have more features than the LUXCORE public consulting services to improve the efficiency, blockchain. This will also provide flexibility to the features, or modification of a blockchain end user and may be maintained and managed by solutions. This scope covers all segments, LUXCORE operational team as required. and pricing will be based on the complexity, scope, and requirements of the customer. SOLUTIONS AND POS WEB WALLET SERVICES CONSULTING MONETIZATION POS Application development on the LUXCORE LUXCORE’s PoS Enabled Web Wallet will be licensed and blockchain will follow both free and freemium monetized as a PoS enabled Web Wallet-as-a-Service to model. Custom DApps for enterprise customers other blockchain assets and providers in the market with will be another key revenue stream. These may customizations and service add-ons. The Licenses and be built on the permissioned blockchains or will Service options for the PoS Web Wallet-as-a-Service will be follow a feature-based pricing. available for purchase using the LUXCoin commodity. 10 LUXCORE WHITEPAPER V2.0 - 2018

TARGET MARKETS AND SEGMENTS 25 25 40 15 25 20 30 15 10 10 30 10 10 Key markets for LUXCORE products depend on use cases of the core offerings. LuxGate and PMN solutions are primarily positioned to meet the demands of private enterprises, public institutions, local government bodies, and banks. The map below represents the key target geographies. Consulting services focus on similar areas while special attention will be given to bringing small and medium businesses and projects in emerging economies under the blockchain ecosystem . In 2018, the global blockchain technology market is predicted to reach $548.2 million USD in size and is forecast to grow to $2.3 billion USD by 2021. LUXCORE is uniquely positioned to take advantage of this growth. LUXCORE WHITEPAPER V2.0 - 2018 11

WE ARE WORKING HARD TAKE A GLANCE AT 2018 COMPLETED MAJOR WALLET UPGRADE 100% LUXTRE - HD WALLET RELEASE 100% POS ENABLED WEB WALLET RELEASE 100% SMART CONTRACT - DEV TEAM CLOSED TESTING 100% MARKETING PHASE II 100% (CONTRACTS AND ENGAGEMENTS SIGNED) IN PROGRESS SMART CONTRACT AND REWARD CHANGE 90% SEGWIT 50% LUXGATE OFFICIAL RELEASE 80% LUXGATE /PMN TTESTING & BUG BOUNTIES 50% MOBILE WALLETS 50% TECHNICAL WHITEPAPER 50% LUXGATE & PMN RELEASE 0% POS WEB WALLET-AS-A-SERVICE TESTING 0% MARKETING PHASE II ROLLOUT 20% PRE-MINE BURN 0% 12 LUXCORE WHITEPAPER V2.0 - 2018

LUXCORE HIGH-LEVEL FINANCIALS LUXCORE did not have an ICO and is funded by the initial pre-mine, which was 5% of total supply, at 3m LUXCoin. This is expected to fund the project for 2 years until the revenue streams are active, after taking into account a proposed burn. Key expenditures from a budget perspective are Research and Development, Human Resources, Marketing and Listings, and Regional setup costs apart from reserve funds. RESEARCH AND DEVELOPMENT 30% REGIONAL SETUP 20% HUMAN RESOURCES 15% MARKETING AND LISTINGS 20% CONTINGENCY & RESERVE FUNDS 15% LUXCORE WHITEPAPER V2.0 - 2018 13

MEET THE TEAM A truly virtual team, LUXCORE as a business, is currently registered in Australia. Following the creation of a legal entity, the central organization will move to a different location (TBD). The organization will have regional offices in Australia, EU, and the US to address regional requirements and business needs. LUXCORE Team is comprised of a core team for strategic decision making. The core team is supported by an outstanding pool of talent, which forms the backbone of our organization - the operations team for both development and business. BRIAN 216K155 OLIVER CHIEF PRODUCT OFFICER CEO CORE DEVELOPER CO-FOUNDER LUXCORE CO-FOUNDER BEN COSMIN WELLINGTON TUDOR MARKETING GROWTH OFFICER PR OFFICER PRODUCT DEVELOPMENT BRIAN F. HARI TECHNOLOGY SADASIVAN BUSINESS STRATEGY OFFICER PLANNING OFFICER JOHN GUILLAUME KIM HUOT BUSINESS PROGRAM DEVELOPER EXECUTION FRONT-END, UI/UX CLIENT OPERATIONS DESIGNER 14 LUXCORE WHITEPAPER V2.0 - 2018

MEET THE TEAM TRAN MAXIM NGUYEN DZEKELEV DEVELOPER CORE LUXGATE & PMN DEVELOPER TANGUY ILYA TPRUVOT TERESHIN LEAD DEVELOPER CRYPTOGRAPHER LUXGATE & PMN PAUL P. SEBASTIAN TESTING BERGER DOCUMENTATION DEVELOPER, WEB/POS WALLET/IOS/ANDROID WALLET DAVID ZACH OLSCHAN-WILSON FORSYTH CYBER SECURITY TECHNICAL SUPPORT EXPERT OPERATIONS CONSULTANT LUXCORE WHITEPAPER V2.0 - 2018 15

LUXCORE.IO PLEASE READ THIS DISCLAIMER SECTION CAREFULLY. IF YOU ARE IN ANY DOUBT AS TO THE ACTION YOU SHOULD TAKE, YOU SHOULD CONSULT YOUR LEGAL, FINANCIAL, TAX, OR OTHER PROFESSIONAL ADVISOR(S). The information in this white paper may not be exhaustive and while we make every effort to ensure that any material in this white paper is accurate and up to date, such material in no way constitutes the provision of professional advice. LUXCORE does not guarantee, and accepts no legal liability whatsoever arising from or connected to, the accuracy, reliability, currency, or completeness of any material contained in this white paper. Investors and potential coin holders should seek appropriate independent professional advice prior to relying on or entering into any commitment or transaction based on material published in this white paper, which material is purely published for reference purposes alone. LUXCoins will not be intended to constitute securities in any jurisdiction. This white paper does not constitute a prospectus or offer document of any sort and is not intended to constitute an offer of securities or a solicitation for investment in securities in any jurisdiction. LUXCORE does not provide any opinion on any advice to purchase, sell, or otherwise transact with LUXCoins and the fact of presentation of this white paper shall not form the basis of, or be relied upon in connection with, any contract or investment decision.