Alliance Block

Introduction

AllianceBlock is building the world's first globally compliant decentralized capital market. Our solution is built on the principles of Censorship Resistance, Transparency, and Openness. Our vision for the future rests on integrating three core principles that embody our approach, strategy, and technology.

AllianceBlock’s platform and services are aimed at realizing a Sustainable Decentralized, Collaborative, and Capital Market that brings together issuers, investors, institutions, traders, experts, advisors, other service providers, and even talent.

Decentralized

The concept, design and architecture of AllianceBlock are driven by a vision of a fairer and diverse market that opens opportunities for investors, issuers as well as other parties (“members”), based on ‘reputation’ rather than a preferential position acquired due to an investor’s portfolio size, or an issuer’s relationship with a centralized decision making authority. A Decentralized Capital Market is not only more resilient but also much more efficient and cost effective as the market’s dependency on centralized validation of trades, or the systemic impact of large players, are substantially reduced.

Decentralization “can facilitate a move away from single entities that grant access to and validate transactions, towards the decentralization of information recording (e.g., via distributed ledgers) as well as the process by which it is updated (e.g., consensus mechanisms). Technology is also facilitating the decentralization of risk-taking and decision-making. For example, peer-to-peer (P2P) lending and insurance are, in places, shifting credit and other risks away from a single entity (e.g. a bank or an insurer) to individual savers (or pools thereof).”

How Allianceblock Works

AllianceBlock supports an end-to-end flow starting with Client Onboarding which validates the identity and creates a presence for an individual or an organization on the platform. The onboarding process includes KYC/AML checks on individuals and due diligence on legal entities. Following these standard checks the data is sent to AllianceBlock’s Regulatory and Compliance framework for the creation of the Investor’s profile and wallet on the platform.

The investor’s profile makes them part of the Augmented Collective Intelligence of the community. Once on the platform, the investor’s profile is used to match them with projects that suit their jurisdictional and investment preferences.

Their profile is extended to include an investor's Reputation Score (A technical Paper with a detailed discussion on the methodology will follow. Please register at the bottom of the page here to receive our updates). Investors can ‘build’ their reputation on the platform through participation - answering questions, staking and promoting projects, and providing feedback / reviews for the benefit of the community.

This Reputation Score is a critical element of the consensus mechanism on AllianceBlock. The process of issuer selection is based on the issue being promoted and accepted by community members. Investors can promote an issuer or project they believe in, by staking some amount of their tokens and opening it to a vote for inclusion in the platform’s listing (TCR). Investors’ participation in the vote depends on their Reputation Score, which in turn is used to weight their vote towards the project. This ensures that projects are democratically selected based on a community members’ earned reputation.

For the issuer, AllianceBlock performs similar onboarding and rating. AllianceBlock and the community support the issuer through the pre-issuance process with book-building, subscription and pricing. The issuer’s project can also be assessed for sustainability and impact and assigned ESG and Impact Scores. These scores contribute to the project’s Overall Rating and determine its position in the platform’s TCR / listing.

Once the offer is in primary market, AllianceBlock covers the whole process including execution, ownership validation, clearance, settlements and payment management. The platform also offers custodial services for investors.

Depending on the regulatory constraints of the issue, AllianceBlock will appropriately enable and support secondary trading on the issue, covering the complete range of services from ordering to entry recording, price discovery, matching, execution, clearing and settlement, transfer of ownership and payment management.

AllianceBlock also allow for the automatization of corporate actions including receiving dividends, casting shareholder votes, withholding taxes, reporting, general assembly communication etc….

Our technology platform supports the whole range of capabilities and activities necessary to sustain a Digitized Capital Market. The key difference, as discussed in sections above, is our approach of a Decentralized Capital Market that uses Augmented Collective Intelligence to enable Self-Governance.

For Investors

Digital Identity: Upon joining AllianceBlock, investors will be provided with a digital identity which will include all of their KYC/AML data, transaction history, preferences and profile. Our platform enables a Self-sovereign Digital Identity so that investors have direct ownership and control over their data, and can decide when, how and how much they want to share with 3rd parties.

Reputation Score: Our Augmented Collective Intelligence will calculate a reputation score for each investor. This reputation score has 2 components: a quantitative component based on the performance of their investments; and a qualitative component derived from the various communications, insights, views, votes of the investor. The higher the reputation score of the investor, the more influence they will have on the platform.

Access to deals: Bankers have long been the unique gateway to investments, typically giving their larger Tier 1 clients early access to deals. This creates an asymmetry where the largest investors have access to the most valuable deals, rather than bringing the most relevant deal to the most relevant investor. As we flatten the “access” pyramid, access to deals will be on a reputation score basis, thus rewarding the “best” investors with early access to deals rather than the “largest” investors. This enables sole traders, tiers 2 and 3 managers to have access to a diverse pool of liquid investments that would otherwise be inaccessible.

Access to Liquidity: Private assets have long suffered from an illiquidity discount. As these assets have poor liquidity, investors usually end up paying up to 30% of illiquidity discount if they want to trade out of their holding before their 5 to 10 year maturity. With Digitized assets and securities, illiquid assets can be tokenized and traded on the secondary market freeing up locked capital and wealth.

Custody:

The AllianceBlock ecosystem will also offer Custodial Services for investors who may want their assets to be held on their behalf. The protocol enables the full range of custody services including safekeeping, reporting and account administration, transaction settlements, the collection of dividend and interest payments, tax support, and foreign exchange.

Platform As A Service

AllianceBlock provides a white-label platform technology solution for financial institutions looking to extend their operations and systems to trade and manage digitized and / tokenized assets. Our PaaS solution is effectively a managed technology service that will seamlessly integrate with your technology and operational processes.

AllianceBlock PaaS offers the following capabilities and coverage:

• Issuance - The PaaS solution covers the process from Onboarding to performing regulatory checks, storing and managing the necessary documents for the issuers, validation of the project for issuance, and the fulfillment / incorporation of any local or global regulatory requirements in smart contracts. Following the launch of the offer, the platform provides a range of capabilities to support the issuance and post issuance processes which includes the automatization of corporate actions (dividends, voting, reporting, communications, ownership registry updates, taxes…).

• ESG Score & Impact Score - The technology can also be used as a solution for ESG and Impact Scoring of businesses. The platform contains a comprehensive analytical component that processes large amounts of data across multiple factors to compute a company’s ESG and Impact scores.

• Traceability & Governance - The platform also offers the capability to track and monitor assets or opportunities that managers and traders might be interested in.