How is privacy guaranteed in Letscoin?
In short: we stay away from big-brother-like practices, and we don't sell your data.
In more detail: Letscoin and the associated communities are bound by legislation that regulates privacy in relation to the storage and storage of personal data. This means that we process the personal data with due observance of the applicable laws and regulations and binding codes of conduct within Letscoin. You can find our privacy statement by clicking here.
Is Letscoin legally permitted?
Yes, legally there is nothing new under the sun. From a legal point of view, Letscoin is a network of companies and individuals who trade with each other in a closed environment through mutual accounting. In other words, members keep track of their mutual trade. Members sometimes earn more than they spend (they build up a positive balance), and sometimes they spend more over a period than they have earned (they have received interest-free credit under the conditions of the network). Together the balance of all balances is always 0.
This is comparable to a commercial barter organization, which has been operating for decades in many places in Europe and the world, and also in Africa. We do, however, continue to have discussions with the Reserve Bank and the Authoritizing Body for the Financial Markets (AFM) to ensure that we can continue to operate in the future.
Every once in a while, there is a "clearing": members with a negative balance (borrowers) pay off in National Currency at the end of their credit period, so that members with a positive balance who have not yet spent, can be helped. Anyone with a positive balance can see on their account how many days are currently gone (up to 180 days).
We have provided extra guarantees by means of this. our guarantee fund, so that we can support the value of Letscoin even with many bankruptcies in the network.
However, the fact that we provide sufficient guarantees for the mutual loans and use innovations in our accounts to make that clearing so effective, does not alter the fact that we are still a normal barter. That is purely an internal matter
Thanks to this position, we can realize mutual credit and we do not have to work with the monopoly money that the banks put into circulation as interest-bearing debts. Credit is therefore interest-free within Letscoin. The disadvantage is that there are no guarantees from Reserve Banks or ECB in the background. We have to make our own beans. And if the economy collapses completely and many a bank collapses, Letscoin at the end of the journey may be worth only 95 cents. But that is a situation in which 20% of the business world goes bankrupt within a year.
However, the legislator states that as long as we have not concluded an agreement with a (sustainable) bank, there is a maximum of 150 Letscoin for private individuals that you can buy with National Currency at a time. Private individuals can earn unlimited Letscoin within Letscoin. For companies there is no limit on the number of Letscoin that can be purchased with National Currency.
Can you evade taxes with this system?
No, you pay just as much tax on income / transactions in Letscoin as with normal money payments. We are also required to share transaction data with the tax authorities. Due to the fully digital environment of Letscoin, it is even more difficult to circumvent tax via Letscoin.
Do you have a guarantee fund?
Yes. The guarantee fund ensures stable National Currency coverage of Letscoin. If you accept Letscoin, then you always have certainty that it will not get stuck. If you have not been able to find spending options within your community for Letscoin (certainly also ask us with an email for help in this case, we would prefer to see Letscoin circulating further) then we can, when the minimum turn around time on your account has expired, exchange Letscoin of your purchases with ordinary Money.
We always aim for a coverage ratio of 103%. We are currently well above this. We have built in sufficient collateral: before the coverage is below 100%, more than 30% of companies in Africa will first have to go bankrupt - a very unlikely scenario. If that does happen, it will still be possible to buy National Currency with Letscoin, but you will for example buy 99 cents for every Letscoin, depending on the coverage ratio.
How secure is the payment software?
No banking software is completely immune to attacks from outside. The security of systems is therefore based on the principle that it must take too much effort to be worth the benefits of hacking. In this regard, there are good reasons to have more confidence in the safety of our system than in the safety of conventional banking systems. First of all, we of course have a team of banking software experts who constantly keep up to date with the latest developments in the field of security and implement them in the software.
Our Cyclos Software is also very safe because it is a closed and digital system. Suspicious transactions can easily be traced and the money in the system cannot be exchanged equally quickly for anonymous banknotes.
Read more about the software on the Cyclos website.