KuCoin Shares Whitepaper

Thursday, May 10, 2018
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WHITE PAPER OF KUCOIN Kucoin - A World-class Cryptocurrency Exchange Platform

KCS Known as Kucoin Shares or KCS for short, the token issued by Kucoin Cryptocurrency Exchange Platform maintains a total issuance volume of 200 million. After buy-back disposal, it will be a constant - 100 million. As a decentralized cryptocurrency issued on the basis of Ethereum, also a standard ERC 20 token based on Ethereum blockchain, KCS supports all the Ethereum wallets. BACKGROUND By August 2017, market value of the global cryptocurrencies has reached $100 billion; meanwhile the worldwide daily exchange volume has reached an astonishing $5 billion. Other than Bitcoin, new cryptocurrencies with new technologies and features have been emerging vigorously in recent years. And their total value and exchange volume has gone over 50% of the global market. Currently, the daily exchange volume of each worldwide top 10 platform has already reached $100 million and maintained the prosperous development. Based on the calculation of 0.1% commission, the daily income of a vibrant platform shall reach $100,000. 02 BACKGROUND

ABOUT The founders of Kucoin Cryptocurrency Exchange Platform started in-depth research on blockchain technology early in 2011 and successfully built KUCOIN Kucoin's technical architecture in 2013. With the reliable and extendable technical architecture in place, Kucoin team stepped into cryptocurrency exchange business confidently in 2017, serving the industry and users with superior services and flexible operation strategies. FOUNDERS Michael Gan / CEO Former technical expert of Ant Financial of Alibaba Group, a veteran of financial solutions, and senior partner of Internet giants like MikeCRM, KF5.COM, etc. Operations & Eric Don / COO Top Lan / CTO Kent Li / Maintenance Director A senior Internet researcher, systems Open source community Technical expert, Operations & Maintenance development architect, and Internet industry star. CTO and manager of multiple mainstream open expert, Operations & Maintenance director senior partner of famous IT companies source projects in Github, designer and and architects of multiple Internet titans, including YOULIN.COM, KITEME and deployer of Kucoin financial exchange Stanford University REAP project Operations REINIOT, etc. system. & Maintenance director. President of the Business Chief John Lee / Operations Group Jack Zhu / Marketing Director Linda Lin / Legal Consultant President of Jianbang Communication and Operations Director of iBOX PAY Chairman of Sichuan Qianyuan Investment project director of group-purchase Southwestern China, manager of a Co. Ltd., executive vice president of Sichuan magnates. Managed 30+ group-purchase marketing team with 300+ employees. Industrial & Financial Development service centers over China with his special Promotion Association. insight of consumer finance.

ADVANTAGES High-performance Operation Strategies Engine The most enduring and fundamental competitiveness The trading system has adopted the of Kucoin lies in its powerful R&D team, which ensures hardware-accelerated and highly-efficient memory a world-class stability and service quality. In the matching technology whose order-making peak value meantime, Kucoin's capable operation team shall is 2 million+/second, order-processing peak value 1 create a bright and prosperous future through million+/second. These statistics are hundreds times, long-term and large-scale online/offline promotion & even thousands of times of the normal industry operation. Majority of the exchange commision will be standard. Therefore it can guarantee no delay or lag rewarded to active users who exchange, invest and throughout the whole core order process when the promote Kucoin. Incentive policies can sustain active market booms. users' enthusiasm and make the business even more vigorous. On the other hand, the invitation bonus plan between users will tremendously boost Kucoin's subscribers and trades. Shortly after, we will accomplish the target of becoming one of the top 10 worldwide hottest exchange platform. Financing-level System Security Stability Learned from the design solution of the state of the art SYSTEM LEVEL: underlying financial system, Kucoin core exchanging It is constructed strictly following the financing-level system adopted an advanced multi-layer and standards. The industry standard transfer encryption multi-cluster architecture. The bank-level protocol is applied to data transfer layers so as to disaster-proof deployment with two locations and three ensure that all user data and sensitive data stored centers which can handle multiple tasks in several through bank-level data encryption. The multi-factor locations simultaneously has been applied, from the dynamic authentication mechanism has been mass flow inlet of domain name resolution to the introduced to sensitive operations like transaction or underlying core exchanging system and accounting withdrawal so as to provide maximum security for our system, thus ensuring the system stability in situations users. like hardware failure, even natural disasters. OPERATION LEVEL: Kucoin has established special internal risk control and operation process departments which have designated strict production data operation and usage standards. It requires multi-level review and approval to check and use all online data and the core data will undergo desensitization so as to ensure the maximum security for user data. 04 ADVANTAGES

Financial Multiple Safety Cryptocurrencies Support Wallets in the platform has adopted multiple security The underlying technologies supports infinite levels of storage solution in line with their storage scale. cryptocurrency trading pairs. In the early phase, Kucoin We have stored the micro-withdrawal wallets in the provides BTC, ETH, and USDT markets, which includes private network architecture built on Amazon Web the trading pair of KCS, LTC, NEO and various highly Services Cloud which has multi-layer firewall on the negotiable ERC20 tokens. The support list will be basis of security isolation. The wallet document itself enlarged shortly in the future. Part of our plan is to has adopted industry-level multi-layer encryption release a unique feature which can help cryptocurrency storage method whose cipher code will be preserved by managers or amateurs to self-register new a special person everytime and this very code will be cryptocurrency pairs and start trading automatically. altered on a regular basis. Any operation to the wallet document requires strict review and approval through internal control procedure and can only be accomplished by two people deciphering simultaneously with the key. Under normal circumstances, macro-wallets will be stored in the bank custody. Efficient Invitation Bonus Customer Service Dedicated to resolve customers' needs without any Registration invite links and QR code will be distributed delay, Kucoin offers 7*24 customer services through to all the Kucoin users. Users will be able to enjoy the multi-channels, including webpage, hotline and e-mail, direct and indirect promotion bonus by inviting new etc. Kucoin's pre-pay and withdrawl safety will be users to register. For instance, if user B registers via inspected by AI algorithm. Once the request passed the user A's invitation code and trade, then a certain potion inspection, automation system will executes entry and of the trading fees will be awarded to user A as direct remit instantly, ensuring both convinience and safety. bonus; and if user B invites user C (and user C invites users D), a portion of the their trading fees goes to user A as indirect bonus too. This portion will be decided by the real situation of the platform operations, please refer to the announcements. Invitation bonus can increase the register and visit numbers and make the exchange and user activities more flourishing. 05 ADVANTAGES

INCOME & EXPENSE The income of Kucoin mainly comes from the fees of user trade and withdraw. We promise to keep the fee rate low. Please refer to the details below: Trading Fee When trading on the platform, it will cost both sellers and buyers a tiny amount of their trading cryptocurrency as trading fee. Withdrawal Fee When withdrawing cryptocurrencies from the platform, it will cost users a tiny amount of their withdrawing cryptocurrency as withdrawal fee. Kucoin's expenses are mainly for operation, promotion and blockchain technology R&D. Please refer to the details below: KUCOIN BONUS INVITATION BONUS TECHNOLOGY R&D Awards for KCS-holding users. Awards for new-user inviters. We saw Kucoin as a technology entity. As a result, more funds will be put into the new blockchain technology R&D, promotion, and application. 06 INCOME & EXPENSE

TOKEN ISSUANCE DETAILS Known as Kucoin Shares or KCS for short, the cryptocurrency issued by Kucoin Cryptocurrency Exchange Platform maintains a total issuance volume of 200 million. After buy-back disposal, it will be a constant - 100 million. As a decentralized cryptocurrency issued on the basis of Ethereum, also a standard ERC 20 token based on Ethereum blockchain, KCS supports all the Ethereum wallets. KCS Features ACQUIRE KUCOIN BONUS To improve user involvement and exchage vitality, Kucoin is going to award incentive bonus, which equals to 50% of the total trading fees charged by the platform, to users who hold KCS in their accounts. Please note that this award proportion could be adjusted based on the actual situation in the future. The initial amount of KCS is 200 million among which 100 million owned by the team and angel investors would not be taken into account when calculating the bonus. In addition, we guarantee that at most 100 million KCS be calculated in the bonus plan during official buy-back and destruction. To obtain the daily bonus, users would need to deposit their KCS into Kucoin Platform. Then the platform will conduct accounting and award bonus based on to the KCS holdings in user's account at 0:00 (UTC+8) that day and all the trading fees charged to the platform on the previous day.Then the bonus gained by users will directly put to their Kucoin accounts in the corresponding currency. For instance, If ETH-BTC cryptocurrency pair rate is 0.063 on the platform and the daily exchange volume is 30,000 BTC; based on the 0.1% rate from each side, the platform shall charge 30 BTC and 476 ETH as trading fees. The bonus for every 10,000 holdings would be 10,000 by 100,000,000 (0.01%). So that the daily bonus from this very cryptocurrency pair is 0.003 BTC and 0.0476 ETH (1 BTC and 17 ETH annually). Please note that this is ONLY the ETH-BTC exchange pair BONUS. Other than ETH-BTC, there are still various cryptocurrency pairs on the platform, which creates the trading fees in the corresponding currency and bonus based on the description above. TRADING FEE DISCOUNT When placing orders to trade, holding a certain amount of KCS in Kucoin account can lower the trading fee. Details will be published through announcements. OTHER EXCLUSIVE RIGHTS When KCS holding reaches certain levels, users can enjoy special services like one-on-one investment consultation, customer service Fast-Pass, etc. FUTURE DECENTRALIZED EXCHANGE SYSTEM GAS Kucoin team is dedicated to blockchain technology R&D and is planned to release decentralized exchange features in the future. As for KCS, it shall be the core fuel of this exchange system. 07 TOKEN ISSUANCE DETAILS

ICO Issuing Mode KCS Initial Coin Offering includes the following three phases: In the first phase, Kucoin founders issues 35%; In the second phase, angel investors and consultants issues 15%; In the third phase, all the public users openly issue the rest 50%. PHASE PORTION AMOUNT DISTRIBUTION PLAN First Phase 35% 70 million Founders' permanent holdings Second Phase 15% 30 million Industry stars and angel investors' holdings Third Phase 50% 100 million Open exchange for all users Lock-up Period The 70 million KCS issued by the founders in the first phase should be subject to a four-year lock-up period from Sep 2nd, 2017 to September 2nd, 2021. Founders are prohibited to assign or sell their KCS holdings in any way before September 2nd, 2018. Team members can only assign or sell 25% of their largest historical exchange volume in 365 natural days from Sep 3rd, 2018 to the end of lock-up period. The 30 million KCS exchanged by the consultants and angel investors in the second phase should be subject to a two-year lock-up period from Sep 2nd, 2017 to Sep 2nd, 2019. Holders are not allowed to assign or sell their KCS holdings in any way before September 2nd, 2018. They can only assign or sell 50% of their largest historical exchange volume in 365 natural days from September 3rd, 2018 to the end of lock-up period. The 100 million KCS issued by public users suffers no lock-up period and opens for exchange from Sep 2nd, 2017. Buy-back Mechanism After the Kucoin platform opened for use, at least 10% of the net profit will be applied to the buy-back of KCS every quarter. The KCS retrieved through buy-back will be destroyed immediately. The buy-back record shall be released to the public at the first time, so that users can review via blockchain explorer, to ensure the open and transparent nature of the whole process. We will continue our efforts in this regard, until 100 million KCS destroyed. Issuing Timelines 2017.08.10 Founders internal issue 2017.08.12 Consultant team and angel investors issue 2017.08.14 Declaration of the Kucoin ICO plan and Publishing White Paper to public investors 2017.08.18 The launch of Kucoin exchange platform - kucoin.com With the conclusion of the issuance, Kucoin users who have KCS holdings shall start getting 2017.09.01 Kucoin Bonus. 08 TOKEN ISSUANCE DETAILS

KCS ICO HOW-TO The cryptocurrency used to participate in KCS ICO is Bitcoin (BTC). Please note that pre-pay in the Kucoin platform with BTC is the prerequisite of KCS ICO. The ICO starts from 8:00 pm of Aug 13th, 2017 and ends at 8:00 pm of Sep 1st, 2017. Once KCS storage runs out, this event will be terminated instantly. The exchange rate is 0.00005500 BTC/1 KCS, which means 1 BTC exchanges approximately 20,000 KCS. ICO Awards If 100 million KCS is not fully issued after this event, then the rest will be firstly used as awards. Any leftover after that will be destroyed directly. ICO AWARDS: A total amount of 10 million KCS will be rewarded to the KCS holders. If the actual award surpasses 10 million, then it should be commuted based on proportion. AWARDS SOURCE: The KCS among the 100 million which has not been issued will firstly be used as awards. If the numbers falls short of the awards, then the difference shall be complemented with the KCS held by Kucoin team. ICO Awards Rules After the ICO, the system will list out the top 10 KCS holders through automatic statistics and award respectively with 15%, 13%, 11%, 9%, 7%, 5%, 3%, 2%, 1% and 1% of their own holdings. Also, after the issuance, the system will provide awards based on the timing of KCS ICO. Starting from August 15th as the first day, the system will award 15% of total daily issued amount, and this percentage goes lower by 1% each day. 09 KCS ICO HOW-TO

DEVELOPMENT PLAN AND TIMELINE 2017.05 Core team and initial fund ready, R&D center established, project started. 2017.08 White Paper released, KCS ICO launched, cryptocurrency exchange platform came into use. Kucoin Bonus proposed, API endpoints opened to public, multiple mainstream cryptocurrency 2017.09 pairs listed. 2017.10 Global promotion started. 2017.11 Mobile apps (Android, iOS) released. 2017.12 Over 50 mainstream cryptocurrency pairs listed, daily exchange volume expected 5,000+ BTC. 2018.06 Cryptocurrency pair self-releasing feature available. 2018.12 1,000+ cryptocurrencies listed, daily exchange volume expected 100,000+ BTC. 2019.06 One of the Top 10 worldwide cryptocurrency exchange platforms. 10 DEVELOPMENT PLAN AND TIMELINE

www.kucoin.com