General FAQs
How does Zoth collateralize real-world assets on the chain?
Tokenization digitizes ownership, enhances liquidity, reduces barriers to entry, and enables a broader investor base to participate in previously inaccessible markets. Zoth’s tokenization factory creates tokens representing the collateral submitted by the borrower in the form of Zoth Asset Tokens, manages the asset transparently, and enables secondary market trading for liquidity.
Who can invest through Zoth?
Zoth is currently open for Institutions and Accredited Investors.
How can a user invest through Zoth?
To begin your journey as an investor with Zoth, connect your wallet and complete the KYC/KYB process. After successful registration, you will gain access to comprehensive details of the RWA opportunities listed on our platform, empowering you to make informed investment decisions.
How do I interact with Zoth?
There are various ways to actively engage with the Zoth protocol. Here are the top methods to get involved:
Join our community on Telegram and become an active member, sharing ideas and insights.
Explore opportunities as an Investor in the upcoming pools.
Consider becoming a borrower to Lending Pools, offering support and backing to borrowers.
By participating in these avenues, you can actively contribute to and benefit from the Zoth ecosystem.
ZSTF
Is Accredited Investor status required to participate in ZTSF pools?
Yes, Accredited Investor status is mandatory to participate in ZTSF.
Can users onboard using a wallet?
Zoth supports onboarding through the MetaMask wallet. Our roadmap also includes expanding onboarding through other wallet providers as well.
What is the currency of the loans?
All loans are in USDC. We are planning on allowing support for other cryptocurrencies as well.
What is the underlying collateral?
Borrowers on the protocol submit RWAs validated by Zoth validators as collateral.
What happens if a Borrower defaults?
For instance, Invoice factoring deals are insured 90% by leading credit insurance companies. Zoth provides a 10% first-loss guarantee for end-to-end coverage.
What are the deals available on Zoth?
Introducing our highly anticipated private credit opportunity! Invest in premium USD receivables from renowned corporations like Walmart, IKEA, Urban Outfitters, and more. Our factoring company purchases short-term invoices at a discount and profits by collecting the full amount
Type: Private Credit
Invoice Factoring
Pool Capacity: 200,000 USDC
Average Yield in APR: 12%
Loan Duration: 90 days
How do you avoid the signed RWA being collateralized on different platforms multiple times?
We currently work with trusted intermediaries and credit scoring companies who essentially validate if the collateral has already been collateralized. We also ensure we have proper documentation and also rigorous due diligence done on the borrowers and collaterals on the pool.
Can the collaterals be redeemed?
The collaterals cannot be redeemed until the loan tenure is matured. The only way to redeem the collateral is by paying off the loan that was issued.
ZTLN
What is a Tokenized Liquid Note?
Tokenized liquid notes are digital versions of traditional fixed-income instruments on a blockchain. They provide enhanced liquidity, transparency, and accessibility through decentralized platforms.
What are Zoth Tokenized Liquid Notes (ZTLN)?
ZTLN Tokens are ERC-20 tokens representing the ownership of structured product units. Each token is a unit of a fully collateralized certificate that tracks the listed value of a specified traded underlying security and is fully backed by that security.
What are the underlying assets?
The issuer has carefully selected a range of high-quality investment-grade corporate bonds issued by globally renowned banks and US Treasury bills.
On which blockchains are Zoth Tokenized Liquid Notes (ZTLN) available?
ZTLN Tokens are blockchain agnostic and are currently available on Base and Ethereum.
Who is eligible to invest in ZTLN?
Qualified investors under Article 2(e) of Regulation (EU) 2017/1129 and retail clients under Article 4(1)(11) of Directive 2014/65/EU are eligible to invest. Investors from the USA are not eligible to subscribe to the notes.
What measures are in place to ensure transparency and security?
Zoth tokenized liquid notes are administered by Apex Corporate & Fund Services Ltd, with digital asset custody by GC Exchange Limited (GCEX). Custodians and traders include Interactive Brokers LLC. Zoth ensures transparency and security through continuous audits by a reputable global audit firm, weekly NAVs, and providing unmatched transparency to build trust.
Is it safe to invest in ZTLN?
Investing in tokenized liquid notes is relatively safe with continuous audits and real-time reserve verification. However, risks include regulatory changes, technology vulnerabilities, and market volatility. It is advisable to refer to the subscription agreement, conduct thorough research, and consider personal risk tolerance before investing.
How do I choose a ZTLN?
Consider factors such as the portfolio investment strategy, credit quality of the securities, expense ratio, past performance, and NAV of the underlying assets.
Can I use a tokenized liquid note for short-term parking of funds?
Tokenized liquid notes are suitable for short-term parking of funds. They provide a stable and liquid investment option, ideal for investors needing to keep their funds for a short duration or without lock-ins.
What is the minimum amount I can invest or redeem?
The minimum investment is USD 125,000.
Is there a fee associated with tokenized liquid notes?
There is a fixed fee of 0.10% per transaction and a servicing fee of 0.50% per annum.
What is the importance of KYC on the platform?
Zoth emphasizes KYC to ensure compliance and verification of investors, ensuring each subscriber is a verified and unique entity, establishing trust and confidence in the platform.
What is the maximum duration of the Liquid Notes?
The underlying assets are high-quality fixed-rate investment-grade bonds issued by renowned corporates with a maximum duration of 1.92 years, renewable thereafter with the same strategy considering dynamics at that time.
Are the tokens transferable in nature?
Tokens are transferable across wallets subject to KYC and are fully collateralized by the underlying asset, issued in compliance with the Securitization Laws of Luxembourg.
What are the smart contracts used by Zoth?
Smart contracts are self-executing programs that facilitate transactions without intermediaries when predetermined conditions are met. Zoth audits its smart contracts to mitigate associated risks.
What are the tax implications of investing in a tokenized liquid note?
Tax implications vary by country. Generally, taxes may apply to earnings or gains from the investment. It is recommended to consult with a tax advisor in your jurisdiction for specific requirements.
Does the issuer have the right to rebalance to maintain portfolio yield?
Yes, the issuer can mitigate risk by investing in higher or lower yielding securities to maintain portfolio yield.
Does Zoth have access to subscriber funds?
Zoth does not have access or control over funds received from subscribers. Funds go directly into a wallet maintained with GCEX via a smart contract deployed by the issuer.
When is a subscriber eligible for the coupon rate?
A fixed coupon of 6% is payable quarterly to subscribers holding liquid notes on the record date.
Is there any coupon or principal risk associated with the liquid notes issued by the subscriber?
Interest rate risk remains a key risk for investors. There is no coupon risk as all underlying assets have fixed rate coupons. Capital return will vary with interest rate fluctuations, affecting the overall yield on the investment.
Zoth Protocol
What are the tokens available on Zoth?
Zoth has two types of tokens.
The Zoth asset token:
Zoth Asset Tokens are LP tokens provided to Lenders as a proof of participation. One can redeem ZAT after the maturity period is over.
Zoth Token ($ZOTH):
$ZOTH is the native token of Zoth ecosystem, Tokenomics is designed to ensure there is a circular economy for the Zoth ecosystem. $ZOTH will be instrumental in:
• Incentivizing Liquidity Providers (LPs).
• Rewarding creditworthy borrowers.
• Establishing a DAO for foundation operations.
• Creating an RWA validator ecosystem.
If it's a stablecoin, where would your reserves be held? What is this pegged to?
Zoth asset tokens are not stablecoins. They are LP tokens provided to lenders as proof of participation. They are not Tradable or Transferable. Furthermore, they can ONLY be redeemed on the Zoth platform after the maturity of the pool.
Zoth native platform tokens ($ZOTH) are not stable tokens. Zoth native tokens are the means we are raising our funds through private rounds.
Will the token minting protocol be controlled by your team or network validators?
Token minting and burning is completely controlled by Zoth DAO.
Who will own and manage the token treasury?
The Zoth Foundation manages the token treasury, until the token launches through TGE. Post the launch of the token, the treasury is managed by the Zoth DAO.
Will tokens be distributed by a smart contract or by your team?
The tokens will be distributed automatically by the smart contract whenever an event happens on the platform.
Will a DAO or the project team control the initial mint?
The Zoth foundation will control the initial mint of the token. Specific details are mentioned in the report on the initial mint.
How can I get updates by Zoth Protocol?
To stay updated with the latest happenings and updates of the Zoth protocol, subscribe to the Zoth Medium page and follow us on Twitter. Alternatively, join our telegram group for additional real-time updates.
By utilizing these channels, you'll have access to the latest news, developments, and updates related to the Zoth protocol.
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