SMS Network Overview

The SMS Network is a user-owned remittance product that leverages AMMs to enable users to send instant, global, decentralized foreign exchange (FX) and transfer, and to capture FX fees for providing self-custodial liquidity to smart contract based token reserves. The following transaction flows demonstrate how various SMS Network remittance types execute, settle, and deliver from sender to recipient through the Telcoin Platform.

Notes:

1. Users of the Telcoin Mobile Application will simply follow the same intuitive steps they use today to send traditional remittances, with the beneficiary having the ultimate choice of receiving local fiat or a supported digital asset (where available). The following is meant to show how the product works "under the hood" after the user clicks "confirm" of a remittance transfer through the SMS network.
2. Each transaction includes a nominal transaction fee paid to Telcoin by users.
3. The Telcoin Platform strives to strike a balance between ensuring best execution for users, growing the list of assets tradable TELx assets, and maximizing the use of TELx pools. As such, a large majority of trades route directly through TELx pools, but this routing is not forced.”

Figure 1: USA customer sends CAD to recipient with bank balance

Figure 1 Transaction Flows

Miners

1. Deposit liquidity reserves in AMMs, receive LPT, and begin earning swap fees.
2. Stake LPT in TELx staking contract
3. Claim TELx liquidity mining incentives after vesting period

Users

1. Sender cashes USD into USDC using bank or card payment service 
   Fee: On-ramp fee
2. USDC swaps for CADc from TELx native USDc/CADc liquidity pools
   Fee: Swap fee paid to liquidity pool
3. Recipient receives CADc
   Fee: None
4. Recipient can choose to cash out CADc for CAD to bank account or put it to work however they choose on the Telcoin platform
   Fee: Off-ramp fee

Figure 2: USA customer sends TEL to recipient from bank balance

Figure 2 Transaction Flows

Miners

1. Deposit liquidity reserves in AMMs, receive LPT, and begin earning swap fees.
2. Stake LPT in TELx staking contract
3. Claim TELx liquidity mining incentives after vesting period

Users

1. Sender cashes USD into USDC using bank or card payment service 
   Fee: On-ramp fee
2. USDC swaps for TEL at best aggregated rate across TEL/USDc TELx pools.
   Fee: Swap fee paid to liquidity pools
3. Recipient receives TEL
   Fee: None

Figure 3: USA customer sends WBTC to recipient from bank balance

Figure 3 Transaction Flows

Miners

1. Deposit liquidity reserves in AMMs, receive LPT, and begin earning swap fees.
2. Stake LPT in TELx staking contract
3. Claim TELx liquidity mining incentives after vesting period

Users

1. Sender cashes USD into USDC using bank or card payment service 
   Fee: On-ramp fee
2. USDC swaps for TEL at best aggregated rate across TEL/USDc TELx pools.
   Fee: Swap fee paid to liquidity pools
3. TEL swaps for WBTC at best aggregated rate across TEL/WBTC TELx pools
   Fee: Swap fee paid to liquidity pools
4. Recipient receives WBTC
   Fee: None