A better engineered cryptocurrency
Terms and Conditions for the Pre-sale of
the FreeMark Digital Currency
The sale of FreeMarks is not available to persons who reside in the US
or in jurisdictions where its sale is unlawful.
The following are forward-looking statements, provided in earnest, yet no one can predict the future.
The FreeMark Price Will Be Pegged, Thus Stable
The FreeMark is an asset-backed stablecoin that maintains its stability using digitally enforced, automatic-pegging to the 6-month moving average of a weighted basket of 20 commodities, calculated daily by the FreeMark software application.
75% of Funds Will Be Placed in Audited Escrow
In order to reduce the risk for early FreeMark buyers, only 25% of the Presale proceeds will be used to finance the development of the software, preparation and marketing of the FreeMark ICO. The other 75% will be held in an audited account as genuine asset-backing for the FreeMark.
The FreeMark Will Protect Against Inflation and Deflation
The FreeMark’s value derives from it being the ideal medium of exchange for international, and local transactions because it protects its savers with very strong inflation and deflation resistance. The average price any buyer pays for FreeMarks is also the minimum price they can withdraw them at, providing deflation resistance. If the basket of 20 commodities rises in price, the price buyers can withdraw FreeMarks at will be higher than their purchase price, thereby offering strong protection against inflation.
Savers of FreeMark Will Earn a Royalty
The FreeMark is purposely designed to be stable. Therefore savers do not earn a return because the price of the FreeMark rises. Instead, they earn more FreeMarks as the money supply (the amount of FreeMarks in circulation) grows. The FreeMark application automatically pays existing FreeMark owners, according to their average balances, a percentage of the growth rate of the FreeMark money supply. That percentage reward to FreeMark owners begins at 7.5% of the growth rate through the first year, and varies thereafter from 5% to 10%. This system is designed to keep the asset-backing of the FreeMark rising annually from the initial 75% towards the full 100% asset-backing, as discussed in the Business White Paper.
What is the Upside? For early savers, up to 20Xs or more over 1st year
The return a holder of FreeMarks can expect depends upon the growth rate of the money supply. This is the opposite of government fiat currencies, which cause savings to become less valuable when the money supply grows. Instead, the FreeMark saver receives more FreeMarks as its usage expands. Our objective is to complete an initial ICO for $25 million by the end of the 2rd Quarter of 2018. With the FreeMark, because it is an asset-backed stablecoin, growth of the money supply is good for savers, not bad. Because the growth rate is higher in the beginning, the early rate of return is higher, as the following three examples show:
The original terms are financially engineered for this higher return. For the FreeMark, the approach is unique and better, as the same terms are offered for investors no matter when they buy FreeMarks, it’s just that they earn higher rates of return because earlier growth rates are higher for the same amount of additional purchases.
For example, with $fm100,000 of FreeMarks purchased at this $1m Tranche, a buyer can earn a Growth Rate Royalty of 7.5% * the growth rate (not 7.5% interest). In this example, if the Money Supply grows to $fm25 million, which is the FreeMark ICO goal, savers will earn on the $fm100,000 FreeMarks owned $fm187,500, plus the original $fm100,000.
If the Money Supply grows to $fm250 million, which is the 1-year goal, then the return is much higher, or $fm1,875,000 plus the original $fm100,000. This is nearly a 20Xs return on the initial purchase.
Look at the next two examples to see how this rate decreases the later the FreeMarks are purchased, which makes sense as the risk is reduced.
If the Money Supply grows to $fm250 million, which is the 1-year goal, then the return is much higher, or $fm725,000 plus the original $fm100,000.
But this is less than for the $fm1 million tranche above, reflecting slightly lower risk.
If the Money Supply grows to $fm250 million, which is the 1-year goal, then the return is much higher, or $fm312 thousand plus the original $fm100,000, for a ~4.1Xs return.
This is considerably less than the case for the $fm1 million tranche above, reflecting the reduction in risk.
Please see the Risk and Reward section below. The upside of purchasing FreeMarks is not guaranteed, but the design of the currency is such that the upside should be achievable.
ICO completed by 3rd Quarter and FreeMark Trading by 4th Quarter, 2018
Worldfree will endeavour on a best-efforts basis to complete its initial ICO for $25 million, and have the FreeMark application trading and functional as a distributed exchange system by the 4th quarter of 2018. There is no guarantee that this will be accomplished, as it depends upon many factors, including our ability to sell FreeMarks under this Presale and subsequent sales, including a planned ICO. These risks are discussed below, in the Risk Factors section below, and Worldfree urges prospective FreeMark buyers to ready and fully understand these risk factors.
To proceed, please expand the following sections and read carefully
Cryptocurrencies Are Terribly Inflationary
When they are going down, they are inflationary—a 10% inflationary decline in value over a day or two is like Zimbabwe or Venezuela. This causes erosion of savings.
Because the FreeMark is stable, an owner can only make funds with it if commodity prices in general increase. But the FreeMark provides a means of gaining more of them, rather than a price increase of each.
Risk and Reward
Practically every attempt to gain a reward entails a risk, which is generally proportionate to the potential reward. Every-day risks such as driving to the grocery store entail risk of life and property through accident, and commonly other normal tasks entail risks to property and person. Financial risks, are an unavoidable, daily fact of life for everyone, regardless how prudent an investment or a transaction may seem.
The FreeMark cryptocurrency, because it is a newly developing one, has a higher risk than exchanging your currency for a Euro or a Swiss Franc, for example.
For this reason, the FreeMark digital currency has been engineered to deliver a substantial reward to earlier buyers.
The FreeMark has been engineered to provide a substantial reward as an incentive to utilise the FreeMark as a medium of exchange. That this potential reward has purposely been made available does not make the FreeMark a security, just a different and better type of currency.
To develop and test the system software, Worldfree first must raise the capital to create the distributed currency and its unique economic benefits. Letting early buyers share in the rewards makes sense, but it should not be the only reason people help us create the better global FreeMark business environment.
The FreeMark is a digital currency that Worldfree’s team has endeavoured to engineer to be the very best medium of exchange. The FreeMark is automatically stable in order to:
- reduce the risk when trading volatile assets such as financial securities, currencies or crypto-assets
- facilitate international trade of goods and services between different currencies by lowing hedging and transaction costs and time requirements
- provide inflation and deflation resistance through automatic pegging to a basket of 20 commodities, selected and weighted according to low volatility based upon 6-month moving averages.
But there is a reason: by limiting 99% of the people from investing in high reward investments, many governments, such as the US through the SEC, are protecting wealthy investors. With less investment chasing offers, the valuation of companies declines, reducing the amount of capital that entrepreneurs can raise, and decreasing the ownership equity that they can retain.
Accredited investors, by the US definition, must have made more than $200,000 in the last two years. That is about 0.3% of the planet, by some estimates. That means more than 99% of people on Earth are not allowed to enjoy the high rewards possible for high-risk investments. It only holds for US persons, but the US often presumes its actions are more reasonable and should be used as a standard, which is simply untrue.
Wealthy investors get better returns with these irrational, unfair laws, however. Less wealthy people and entrepreneurs are penalised to provide greater returns for the investors who don’t benefit from better returns as much in comparison, a completely unacceptable situation.
The end result is less money for investment in new businesses, and therefore fewer jobs created, less social mobility, and slower economies.
A purchase of FreeMarks includes only the currency units purchased. Any additional promotional bonus is not to be included in the purchase price, but to be considered as a free item as a gift from Worldfree, without significant commercial value.
Volatility Kills the Crypto-economy
Cryptocoins go up and down, sometimes 20% in a couple of hours. This massive volatility keeps most people from using cryptocurrencies as a practical medium of exchange—it’s too risky.
When the Bitcoin is going up (deflation), few owners wants to spend it. When it’s going down (inflation), few buyers want to accept it.
An investment in the FreeMark cryptocurrency offered hereby involves a high degree of risk and should only be made by persons who can afford a total loss of their investment. The sale price is not to be considered a representation that the FreeMark currently has a market value equal to such sale price or that it could be resold at such price. Worldfree expects to have the FreeMark trading on its distributed exchange by the 3rd quarter of 2018, with automatic pegging of the price to a basket of commodities at that time, perhaps sooner, depending upon the outcome of the FreeMark Pre-sale and ICO. From the time of the ICO onward, the FreeMark will enjoy an automatic pegging of its price to a basket of commodities. In evaluating an investment in the FreeMark digital currency, prospective buyers should consider carefully the following risk factors:
Firstly, any statement about the future can be neither true nor false until the time arrives. Worldfree (the “Company”) management can only explain our premises and assumptions and the conclusions we have reached about future affairs. It is the responsibility of each investor to accept or reject the validity of Worldfree’s forward-looking statements. No one can predict the future consistently, there are just too many variables.
Secondly, Worldfree understands that investors only invest in the future. No reasonable person would expect to give someone $100 today, and at the same instant expect someone to give them $110 back, thus what happens in the future is critical for investors to be successful.
Thus, because they invest only for future returns, investors want someone to tell them the truth about the future. But they cannot get that—there isn’t any yet.
Investors are therefore advised to rely upon their own judgement about the future for their investment decisions. Forward-looking statements provided by Worldfree are done so on a best-efforts basis.
Worldfree’s management has attempted to identify, in context, certain of the factors that it currently believes may cause actual future experience and results to differ from the Company’s current expectations. The differences may be caused by a variety of factors, including, but not limited to, adverse economic conditions, intense competition, including entry of new competitors, adverse federal, state and local government regulation, inadequate capital, unexpected costs, lower revenues and net income than forecast, price increases for supplies, inability to raise prices, failure to obtain new customers, the risk of litigation and administrative proceedings involving the Company and its employees, the possible acquisition of new businesses that do not perform as anticipated, the possible fluctuation and volatility of the Company’s operating results and financial condition, adverse publicity and new coverage, inability to carry out market and sales plans, loss of key executives, changes in interest rates, inflationary factors, and other specific risks that may be alluded to in this or other reports issued by the Company.
Worldfree’s management cannot not predict the future, only endeavour to identify and understand past trends, emerging opportunities, and fundamental needs of the markets we seek to serve. We present our conclusions and the evidence in support of them and hope you join us in our earnest efforts to bring our unique and better vision of a rational financial and monetary world to reality.
Worldfree is a young company that must raise capital in order to achieve its goals and become a long-term, sustainable venture.
The FreeMark is a new cryptocurrency that is under developed and must gain market acceptance and use before becoming a long-term, successful medium of exchange.
These are accurate representations of the present state of Worldfree and the FreeMark. Readers are urged to read and understand the other information contained in the two Worldfree White Papers, and information conveyed elsewhere on the Worldfree website.
Worldfree may as a result of changing market conditions and technologies alter its planned fund allocation, change the composition and compensation of the team, or alter the technologies Worldfree has invented to solve important problems that Worldfree’s team have identified.
Thus, Worldfree will execute on our plans on a best-efforts basis, using our best understandings, responding to always changing market conditions and future opportunities as we pursue creating the FreeMark, which Worldfree’s team hopes will be in existence for hundreds of years—a goal you as a FreeMark buyer can help achieve.
There can be no assurance that Worldfree will be able to achieve profitable operations in the future. The Company’s management anticipates that the Company will incur losses from its operations until the FreeMark is fully marketed. Results of operations in the future will be influenced by numerous factors, including, among others, the ability of the Company to complete development of its product line and successfully and profitably manufacture and distribute its anticipated products in commercial quantities; market acceptance of the Company’s products; the Company’s ability to develop and market or commercialise new products; the ability of the Company to manage its growth and maintain the quality of its products and the ability of the Company to effectively implement its business plan.
The Company has only recently commenced operations, therefore the Company does not have historical audited statements.
The Company’s capital requirements depend on numerous factors, including: the rate of market acceptance of the Company’s proposed products and services, the Company’s ability to maintain and expand its customer base, the level of resources required to expand the Company’s market and sales organisation, research and development activities, the pricing and timing of acquisitions and other factors. The timing and amount of such capital requirements cannot be accurately predicted.
If capital requirements vary materially from those currently planned, or if the Company is unable to sell the entire amount of the Offering at the proposed pricing, the Company may require additional financing sooner than anticipated. The Company has no assurance that additional such commitments can be obtained on favourable terms, if at all.
The Company has begun to sell FreeMarks, yet it is impossible to predict the level of market acceptance of the FreeMark. There can be no assurance that sufficient sales of the FreeMark will sustain the ongoing operations of the Company.
The FreeMark will be sold in this Presale of $fm6 million on a “best efforts” basis. Thus, there can be no assurance that all of the FreeMarks offered hereby will be sold. There is no minimum-offering amount that is required to be sold before the Company may use the proceeds of the Offering.
Twenty-five percent (25%) of the Funds tendered by prospective purchasers will not be placed in escrow, but will be available for use by the Company immediately upon acceptance, for the purposes and in the amounts as estimated under “Use of Proceeds.”
Seventy-five percent (75%) of the funds tendered by purchasers of the FreeMark will be placed in an audited account, to be held as asset-backing, and returned in the event that the Company cannot continue operations at some future date. These funds will be invested in no less than investment-grade securities or interest-bearing accounts, the proceeds of which will provide operating capital for Worldfree to continue its funds raising as necessary.
With successful performance in the Presale and ICO, the 75% funds will be transferred to The FreeMark Reserve Endowment (the “FMR Endowment”), a regulated, audited and professionally-managed Cayman Island fund that will be legally tied to providing only the liquidity needs of owners of the FreeMark, and invested in order to provide inflation and deflation resistance. Management fees of 20% on performance, and 2% of the FMR Endowment will be charged on an annual basis to compensate the management of the FMR Endowment. The stated Goal of the FMR Endowment will be to deliver a 6% annual return to the FMR Endowment after fees, on an average basis.
If the Company sells less than the full amount sought in this Presale, it may not be able to accomplish its goals and may be required to seek additional financing, which may or may not be available, or on favourable terms.
The FreeMark venture has other risks, namely:
- Dependence on Key Personnel—Worldfree is highly dependent on the technical and managerial skills of its key employees, including technical, marketing, advisors, and executive personnel, and on its ability to identify, hire and retain additional personnel. Competition for key personnel, particularly persons having technical expertise, is intense, and there can be no assurance that the Company will be able to retain existing personnel or to identify or hire additional personnel. In particular, the Company is highly dependent on the continued services of its senior manager: Kevin AP Kirchman.
- Risks of Technological Change—The markets for cryptocurrency software applications are characterised by rapid technological developments, frequent new product introductions and evolving industry standards. The emerging nature of these products and their rapid evolution will require that the Company continually improve the performance, features and reliability of its FreeMark applications, particularly in response to competitive offerings. There can be no assurance that the Company will be successful in responding quickly, cost effectively and sufficiently to these developments. There may be a time-limited market opportunity for the Company’s software systems, and there can be no assurance that the Company will be successful in achieving widespread acceptance of its products before competitors offer products with performance similar to or greater than the Company’s current offerings.
- Initial Lack of Liquidity—There is currently no established trading market for the FreeMark, although the Companies plan is to establish a distributed exchange for its use in purchasing goods, services, financial securities, as well as its exchange for other cryptocurrencies and currencies in general. As a result, owners of FreeMark must bear the risk as they await the Companies accomplishment of the establishment of that exchange. The FreeMark should only be purchased by persons who have no need for liquidity in their investment.
- Risk of Product Defects—Software products as complex as those to be offered by the Company may contain undetected errors or “bugs” when introduced or when new versions are released. No assurances can be given that, despite testing by the Company, errors will not be found in new products or releases after commencement of commercial operations, resulting in loss of market share or failure to achieve market acceptance. Any such occurrence could have a material adverse effect upon the FreeMark’s marketing, business model, financial condition and results of operations.