WHITEPAPER V1.0.

01 PUBLICATION OCT 2019

MARSHALL INC. YEAR 2018

PRICE STABLE
S I N G U L A R CRYPTOCURRENCY WITH AN
ALGORITHMIC CENTRAL BANK
B Y B I T I N E X T

TERRENCE HOOI
 WEIPING LEONG
DAVID DRAKE
 SINGULAR- AN ALGORITHMIC CENTRAL BANK

ABSTRACT
WHY STABILITY IS PARAMOUNT

Throughout history, money has The fact is, by holding your wealth

been used to facilitate trust between in cash, it is actually eroding. Say

both sides in a transaction. Capital you had $100,000 cash in year

& investment flow into countries 2000, in 2019 the value is only

with stable money like the US around $51,000. In other words,

Dollar. Stable currency is the 51% of the value of your money has

foundation of prosperity. Stable evaporated based on average

money gave birth to innovations inflation per year of 3.36%.

like the steam engine, railroads and

the industrial revolution.. In countries like Zimbabwe the

Zimbabwe dollar was worth more

When money is made artificially than the U.S dollar when it first

unstable by government, the became independent in 1980.

information ends up being Today, the 100-trillion dollar

corrupted. During the 2008 global Zimbabwe bills (worth 40 US cents)

recession,  the U.S federal has become a hot souvenir item

government implemented strategies among tourists.  Imagine how much

to lower interest rates and wealth has been destroyed instead

quantitative easy that resulted in a of creating wealth with monetary

dramatic drop in the value of the expansions. If printing money

dollar. created wealth, there’d be no

poverty left on earth.

STABLE MONEY: THE FOUNDATION OF
PROSPERITY

When people lose trust in a currency, this gives rise to alternatives like

the now-banned Liberty Dollar and the more recent Bitcoin and other

cryptocurrencies. However, price volatility is one of the biggest barriers

to adoption of cryptocurrencies like the Bitcoin. The failure of

widespread adoption of Bitcoin might include the fact that Bitcoin is

unregulated and anonymous. If users cannot be sure the purchasing

value is a stable measure of value, cryptocurrency cannot function as an

instrument of trust.

Next, try to imagine if you receive your wages in Bitcoin, assuming 1

BTC per month. If the price of BTC drops by 40% in that month, you

might not be able to pay for your rent or buy groceries. Bottomline, the

price volatility of BTC is the biggest barrier of entry for widespread

adoption of the BTC for day-to-day transactions.

You will be constantly adjust to the notoriously volatile BTC price to

justify your potential purchase. Say the Uber ride that you are paying

with BTC when price is $10,000 and few days later the price of BTC

drops to $8,000, you would reflect and think that you paid 20% extra for

that ride. Conclusion, this is a really bad consumer buying experience.

Furthermore, paying with BTC is still slow and expensive.

MONEY IS THE FOUNDATION OF TRUST. CONVERSELY, TO BUILD

TRUST WHICH LEADS TO WIDESPREAD ADOPTION OF A
CRYPTOCURRENCY, STABILITY IS PARAMOUNT.
SINGULAR- AN ALGORITHMIC CENTRAL BANK

WHEN PEOPLE LOSE TRUST IN A CURRENCY

According to Gresham’s law, people tend to hold the “stable” or accurately

valued money while dumping the “volatile”. So how do we create trust and

remove the barrier to widespread adoption of cryptocurrencies?

Stability- stability is a fundamental block if cryptocurrency is to fulfil its role

as an instrument of exchange in the marketplace. Our primary objective should

not be about speculating in a cryptocurrency but to create one that preserve our

money. Bitinext's mission is to create stability and a result of this process might

encourage the formation of new capital needed to finance the Apples, Googles

of tomorrow around the world.

We believe that when the dollar was as good as gold, working people- not just

rich people -prospered. A post gold standard era pointed that the removal of

gold standard has taken away every penny of nominal pay increase for 41 years.

In other words, a normal working class person makes in real terms today at

$33,480 is the virtually the same as it was in 1968. Why is it today that two

young adult incomes can barely pay for a family of three what one could have

done 40 years ago?

According to studies on the decline of dollar’s purchasing power, the median

net worth of households by Millennials in America (those younger than 35) has

plunged from $11,521 in 1984 to just $3,662 in 2009- a whopping 68% decrease

in wealth. In other words, with the same income millennials are getting today,

they have 68% less purchasing power. 

To make matters worst, the taxes imposed by U.S federal government has

steadily increased for the past four decades, meaning couples with their

combined salaries are getting higher tax brackets.

THE GOLD STANDARD

"When the US dollar

adopted the gold
standard, between 1950-
1968 , real median
incomes rose steadily
from $19,989 to $32,310
with an average 2.5%
increment per year."

Today however, the artificial A classic example when the

windfalls created by loose Great Britain pegged to the

money can create the British pound to gold for

appearance of prosperity, but more than 200 years and held

why aren’t people getting the record for stability.

rich?

As a result, capital creation

Although people may appear and investment exploded in

to be, but the overall society the country and Great Britain

is getting poorer as money is used that capital to spark

becoming cheap. When innovations like the steam

central banks continues to engine, railroads and other

cheapen money, it destroys technological advances that

purchasing power of every marked the industrial

dollar you earn. It also revolution.

reduces the value of assets

owned by individuals and

businesses.
 THE QUANTITY THEORY OF MONEY
HOW CENTRAL BANKS STABILIZE MONEY

To understand how central banks respond

CENTRAL BANKS ADJUSTMENTS to inflation targets- say, the average cost of

a predefined good or basket of goods is

$50. According to the Quantity Theory of

Money Supply Expansion
Money, if you doubled the supply of money
Money Supply Contraction
in circulation that everyone keeps in their

savings accounts, then in the long run, the

exact basket of goods will be $100.

Consider a central bank has doubled the

money in circulation, the nominal amount

of money everyone has doubled, but at the

same time, the value of the basket of goods

remain the same.

As a result, people should be willing to

spend twice as much money to get the

same value from the same basket of goods.

Indirectly, the central bank has erased the

value of people’s savings by 50%. 

On the other hand, if the central bank tries

to slow down inflation, the price for a

basket of goods is increasing meaning

people are willing to spend more money.

 INTRODUCING SINGULAR

To decrease inflation, the Money Supply Expansion-

central bank would increase central banks increase the

interest rates in bonds to money supply when basket of

encourage people to save goods prices are going up.

money and spend less. This will bring back value of

the currency back down.

These are the two measures by

central banks do to manipulate Money Supply Contraction-

the value of money. Let’s look central banks decrease the

at these two high level money supply when basket of

adjustments by the central goods prices are going down.

bank to adjust a currency’s This will bring back value of

supply to inflation: the currency back up.

In this paper, we introduce “Singular” as a cryptocurrency

with price stability. Singular can be pegged to US Dollar,
gold-based system, consumer price index (CPI) index or
basket of goods, replicating how the Fed adjust to inflation
targets today.
 ROADMAP
TO AN ALGORITHMIC CENTRAL BANK

50

40

30

20

10

0
Phase 1 Phase 2 Phase 3 Fully Decentralized

In the first phase, Singular will be pegged to the

1ST PHASE
USD and will always trade for 1USD. Singular
PEG TO USD OR CPI INDEX
will also maintain a 100% collateral backing

using a decentralized system to optimize the

2ND PHASE
demand of supply of Biti tokens.
THE SINGULAR PROTOCOL

In the later phase, the Singular protocol uses

3RD PHASE
algorithm without the need of human judgement
ALPHA BRAIN NEURAL
ARCHITECTURE meeting the Singular token to ‘float’ while

maintaining it’s stability and controlled only by

voters of Singular holders.

If cryptocurrencies are so great, why aren’t

people using cryptocurrencies for day-to-day

transactions? Although Bitcoin has proved the

blockchain model is robust and secure, some

would say it is still expensive and slow.

 DRAWBACKS OF BITCOIN

First we examine the inherent Secondly, consider that

volatility of Bitcoin and cryptocurrencies are immune to

Ethereum. The problem with fraudulent chargebacks, and

using Bitcoin as a medium of transaction fees can be ultra low

transaction is not viable due to compared to credit or debit

the following reasons.  cards.

Furthermore, it can take as long But why merchants are still

as 60 minutes to transfer refusing to accept

Bitcoin.  cryptocurrencies?

To understand this, let’s look at

how Microsoft, Quickbooks and

Spotify accepts Bitcoin using

Bitpay which in return merchants

will convert it into USD.

Reason being, the volatility

prevents these merchants from

storing it as a primary source of

payment and those merchants are

not in the business of speculating

on cryptocurrencies. While it is

true that many respected

institutions are already using

blockchain.
 HISTORY OF STABLE MONEY

GIANT STONES-FEI
1500
South Pacific Islanders who
traded giant stone coins known
as fei. As the Islanders believe
GOLD STANDARD -BRITAIN
there is intrinsic value of fei, it
1821
was a great indicator of worth.
Great Britain pegged to the British
However few were large,
pound to gold for more than 200
heavy, ranging in a foot to
years and held the record for
twelve foot. South Pacific
stability. As a result, capital creation
Islanders believe giant stones
and investment exploded in the
worked beaches it was a
country and Great Britain used that
reliable measure of value.
capital to spark innovations like the
steam engine, railroads and other
technological advances that marked
the industrial revolution.

"If we can solve the stability block for

cryptocurrency, this not only enable the
blockchain ecosystems like dApps, but also a
use case for hyperinflationary economies as a
store of value. "
THE INHERENT DAPPS CHICKEN & EGG
PROBLEM

But how do we trust the money that we hold can

retain its value over time? Biti’s mission is a build
a price stable currency and a society fluid and
open to merit.

People lose faith in a currency when a

government prints too much money or seem
likely to do so in the future. People can also lose
faith in money when there is a cataclysmic event
like war. As a result, demand for Gold goes up
with high uncertainty in a society.

Imagine using a $200 Store of Value for

Smartphone that allows Developing Markets 

anyone to send thousands of

dollars using a medium of How Biti Protocol

exchange that is robust, Works

decentralized and price-

price-stable, we present the An Alternative for

following use cases for Dollarization 

Singular token:
 USE CASES FOR SINGULAR

HYPER INFLATION IS EATING THE

WORLD

More than a hundred years ago, Argentina was

the eighth-largest economy in the world,

rivalling the United States. 

To cure inflation, the Argentine government in

the twentieth century resorted to printing

money like crazy to finance its welfare state.

Decades later, Argentina was facing

succession of currency crisis called

hyperinflation where inflation reached as high

as 5,000%.

In fact, the government tried to criminimalize

anyone outside the administration to publish an

inflation figure that contradicts the figure

shown. This ultimately failed as devaluations

of the Argentine peso has destroyed public

confidence which is hard to restore.

HYPER INFLATION AROUND THE

WORLD

As of this publication in Q3 2019,

Argentina’s yearly inflation is 47.6%,
Egypt 20.86%, Nigeria 12.09%,
Venezuela 929,789.50%, Sudan 63.29%,
Yemen 41.77%.
USE CASES FOR SINGULAR

DOLLARIZATION IN
HYPERINFLATIONARY ECONOMIES

People living in developed economies might

not feel the effects of hyperinflation and may

take for granted the access to stable currencies.

Imagine if you live any of the countries with

hyperinflation every year, these people literally

have to go into the street to exchange their

local currencies for dollars in black markets.

In some developing countries, the government

imposed capital controls to stop people from

moving hard currency out of the country.

This can be traced back to ancient Rome where

the denarius was debased by one emperor after

another and eventually the denarius became a

piece of junk. Inflation started going up, and

like in Venezuela or Zimbabwe today, savings

vanished. When people stop trusting money,

and trust is non-existent, businesses fail.

 WHY VENEZUELANS ARE
GOING HUNGRY

So why in 2018, socialist The Financial Times reported in

Venezuela, a country that had 10 2013, buying day-to-day necessities

major devaluations since the like rice, oil, flour, milk, medicines

1980’s went as high as and toilet paper becomes extremely

1,300,000% inflation? difficult.

The printing of money has only People in the country are literally

managed to meet the short-term losing body weight (24 pounds per

need of government’s needs but year) with 90% poverty rate

has ultimately destroyed faith in because the currency is agonisingly

the currency. misaligned.

When currencies are unstable, it Venezuelans are going hungry. 6

makes it very difficult for local out of ten said they are going to bed

citizens to meaningfully invest in hungry because they don’t have

local businesses. enough money to buy food.

Without a reliable currency,

exports will drop and ultimately

bring in less revenue slowing the

entire economy.

"In conclusion, there is a severe need for price stable

currency in developing nations where people look for
other ways to survive by using the USD."
HUGE INFLUX OF DEMAND
We expect a huge influx of demand for price-stable

cryptocurrency to come from developing countries, and

here’s why:

Firstly, the effect of dollarization used by many

Central Asian, Latin America and sub-Saharan

African countries and the rate of adoption can be fast

without the need of official coordination. Both

Ecuador and El Salvador adopted the US dollar in

2000.

Next, citizens in a country might demand dollar in

spite of capital controls that prevents the transfer of

USD across borders.

There is a large black market in Argentina for

dollars. Up to $50 million per day was transacted in

black markets in 2016. Black markets offer 50-100%

more pesos per dollar compared to official rate due to

capital controls. 

A complete devaluation might prompt government to

officially switch to the USD. Ecuador, East Timor, El

Salvador, Marshall Islands, Micronesia, Palau, Turks

and Caicos, British Virgin Islands, Zimbabwe as

dollarization examples. However, this is still slow

and expensive as it requires routine physical delivery

of greenbacks to the country in paper and coins.

OPPORTUNITY IN
HYPERINFLATIONARY ECONOMIES

In developing nations whether or not dollarization is adopted,

there expect a massive demand for price-stable

cryptocurrency in which, millions can be transacted on a

$300 smartphone, which is a massively superior alternative to

paper dollars. Furthermore, every transaction is recorded on

the blockchain while having a peace of mind that the value

will remain stable.

What about existing cryptocurrencies like Bitcoin &

Ethereum? Bitcoin can never solve the issue of stabilizing

their local currencies as Bitcoin or Alt Coins are inherently

unstable.

The result: people will move away from price-stable

alternatives including a price-stable
cryptocurrencies if one exist today.
 PAYPAL IS NOT CRYPTOCURRENCY

A BRAVE NEW WORLD

A word from Chistine LaGarde, IMF Chairman

"Fintech will change

central banking over
the next generation."
Christine LaGarde, IMF
Chairman 2017

That is the focus of the Singular protocol today. 

LaGarde added consider the possible impact of three

innovations- virtual currencies, new models of financial

intermediation and artificial intelligence.

Imagine if countries with unstable currencies and weak

institutions started adopting the currency of another

country- such as the U.S dollar- instead start using virtual

currencies.

We call this dollarization 2.0 

Digital payments should not be confused with

cryptocurrencies.- through Paypal and other “payment

processors” such as Alipay in China, or M-Pesa in Kenya.

CRYPTOCURRENCIES IS A
DIFFERENT CATEGORY ALTOGETHER

The IMF explained there is a

Crypto is a Different Category tipping point beyond which the

Dollarization 2.0 coordination around a new

The Singular Protocol currency is exponential.

Cryptocurrencies, Price-Stable

cryptocurrencies to be precise, are

a different category, because they

provide their own unit of account

and payment systems.

These systems allow for peer-to-

peer transactions without central

clearinghouses, without central

banks.

Bitcoin pose little or no

challenge to the existing order of

fiat currencies and central

banks.

Why? Because they are too

volatile, too risky, too energy

intensive, and because the

underlying technologies are not

yet scalable.
CRYPTOCURRENCIES IS 
DOLLARIZATION 2.0
We believe the current technological challenges could be addressed in the near

term. For instance, not so long ago, some experts argued the iPhone’s

touchscreen was a bad idea, these things will never work.

Although Bitcoin transfers are still slow and expensive, we think it may not be

wise to dismiss the ERC-20 Ethereum with average block time of 16 seconds.

Ethereum is currently trying to decrease the transfer time from wallet to wallet

down to 3 seconds. For those reasons, Singular will be using the ERC-20

Ethereum based token system.

Furthermore, Ethereum is able to support decentralized application such as

dApps. Those dApps are currently built on the exiting Ethereum framework,

using it is as underlying technology.

A price-stable token like Singular in return can be used by all dApps on the

platform. If you believe that for dApps marketplace like the next blockchain

Uber, Airbnb or Facebook where buyers are connected to sellers directly

without a centralized organization, it is fair to believe that a price-stable

cryptocurrencies will be the catalyst for the rise of dApps.

In the first phase, Singular will be pegged to one USD. The US dollar is a good

peg because it is the most liquid currency in the world. However, this is not a

long term solution as it is still a centralised approach to stabilising a

cryptocurrency.

The Singular protocol will enable capital markets to form on top of its protocol

and we expect as the demand of Singular increases, more users will want to

hold the Biti token and thus creating a network effect.

REPLICATING THE FED’S EXPANSION &
CONTRACTION MODEL

THE SINGULAR PROTOCOL

If dApps succeed in the near future, each blockchain app will need an

interchange system to covert between some major token into a ‘universal price-

stable token’ and all the other different app tokens. We expect the rise of

blockchain apps in the next 5 years, the demand of price-stable token like

Singular will increase.

How Singular protocol defines a peg. Firstly, the protocol looks for a stable

currency, might be the USD, or the Gold price or a Consumer Price Index

(CPI). Next, the Biti protocol pegs it to an asset with the value of $1 for 1

Singular token. 

Getting Price Feed from Oracle Blockchain Platform. Next, with real time

price feed from blockchain sources like Binance, Huobi, Coinbase, USD,

Gold prices etc. 

Expansion & Contraction of Singular Tokens. The blockchain will then

adjust the supply of Singular tokens based on the deviations from the current

exchange rate or $1 from the peg. There will be two scenarios based on the

deviation from the $1 peg

To replicate the Quantity of Theory of Money which states that in the long run

prices in an economy will reflect the supply of money in circulation. The Biti

protocol utilizes this theory to control the supply of Biti tokens in circulation:

The Singular token , will start by pegging to the USD, 1 token will trade for

1 USD. To make 1 Biti token to trade as close to 1 USD, we use the

expansion and contraction model described earlier.

QUANTITY THEORY OF MONEY

To calculate the Coin Market Cap or total demand of Singular tokens. heres

the simple formula, how many people want the coin- demand = (coin price)

& (no. of coins in circulation)

Lets assume if demand exceeds supply. In this example the demand for the

past few months has increased and now Singular token is trading at $1.05 :

Now our objective is to stabilize the Singular token, by bringing it back

down to $1.00, the Singular protocol will then increase the coin supply to

decrease the price and adjust it to the original $1.00

In sum, by following the Quantity Theory of Money that if the Singular token is

trading at either price away from the original $1.00, the Singular protocol will

begin will restore it back to $1.

Of course, the Quantity Theory of Money also measures the velocity of

circulation which we will cover later in this paper.

IF THEN SCENARIOS OF
THE SINGULAR PROTOCOL

IF SINGULAR TRADES FOR MORE

THAN $1,
THE BLOCKCHAIN WILL MINT NEW
SINGULAR TOKENS BY THE
PROTOCOL DETERMINED BY RIGHTS
TOKEN HOLDERS OF SINGULAR.

IF SINGULAR TRADES FOR LESS

THAN $1,
THE BLOCKCHAIN WILL INCREASE
BOND TOKENS INTEREST RATES
AND SELL MORE BOND TOKENS IN
THE OPEN MARKET.
BOND TOKENS CAN ONLY BE SOLD
BY USERS WHO HAS BITI TOKENS
AS COLLATERALIZED ASSETS. 
BONDS TOKENS WILL SELL FOR
LESS THAN $1 TO GIVE THE BUYER
AN INCENTIVE OR PREMIUM.
ASSUMING AN EXISTING BOND
BUYER BUYS THE BOND TOKEN AT
$0.9, KNOWING  SHE WILL RECEIVE
ONE BOND TOKEN IN THE FUTURE
WITH A VALUE OF $1, THATS A
PREMIUM OF $0.10.
THE GOLD EXCHANGE STANDARD

Assuming if the dollar is pegged to gold, which is still volatile, remember the

classical gold standard was used by Great Britain and the United States and gold as

a yardstick of value. Even today, counties like Denmark, Bulgaria, Lithuania and

Hong Kong has its currency tied to the dollar since 1983. Again, this is not

practical to have a 100% gold backed dollar.

Furthermore, gold is notoriously volatile in the short term.

Singular protocol will be based on Forbes & Ames Gold price average system as an

effective hedge against inflationary disasters by the ever weakening dollar.

The Singular protocol will only allow gold to fluctuate against the dollar with a

range of 1% , using the Bretton Woods system against the US Dollar. The Gold

token would allow people to turn in Singular tokens to receive Gold token at a

fixed rate for dollars. With the Gold token, it allows Singular to create a new gold-

based standard and also allowing the token supply to expand naturally. 

According to Forbes & Ames (2019), if United States uses gold as a standard for

the dollar, numerous countries in Latin American and Asia will begin to keep their

currencies aligned to the greenback as this makes trading and investing easier.

SOLUTION:
SINGULAR WILL BE USING 10 YEARS AVERAGE OR
EVEN 5 YEARS AVERAGE OF DOLLAR/GOLD PRICE
MARKED UP BY 10% AS AN INSURANCE AGAINST
DEFLATION.
REPLICATING HOW THE FED STABILIZES
MACROECONOMIC DEPRESSIONS

HOW A NEURAL ARCHITECTURE

IMPLEMENTS PRICE STABILITY

The Singular Protocol uses The Singular protocol uses

TensorFlow open source blockchain to expand or

Machine Learning to run contract the supply of Biti

Monte Carlo tree search tokens.

algorithm to find the best

scenario to achieve stability We propose a deep learning

for the Singular token. based approach to

automatically design token

We propose a deep learning supply in a variety of

based approach to domains, moving the

automatically design token design work from the Fed

supply in a variety of (human) to machine.

domains, moving the design

work from the Fed (human) The Singular protocol

to machine. focuses on producing a

trustworthy and efficient

token supply system that

minimize the friction

between participants.
THE THREE TOKEN SYSTEM

The Singular protocol uses the three token

system to stabilise the Singular token. In the

future, the Singular protocol could be

operating on its own chain and we will develop

the Singular token using the Ethereum

network:

THE SINGULAR TOKEN (ST)

A PRICE-STABLE CRYPTOCURRENCY PEGGED
TO THE US DOLLARS OR OTHER STABLE
COMMODITIES LIKE GOLD. OTHER ASSETS
HELD IN SMART CONTRACTS TO BACK THE
VALUE OF SINGULAR TOKEN.
REAL-TIME PRICE OF AVERAGE 5 YEARS
GOLD PRICE + 10% TO ACCOUNT FOR
DEFLATION

THE BOND TOKEN

THE BOND TOKEN IS USED TO FACILITATE
THE STABILITY OF SINGULAR TOKEN PRICE.
HOLDERS OF COLLATERIZED ASSETS MAY
INCLUDE ASSET CLASSES SUCH AS
 CURRENCIES, COMMODITIES OR
SECURITIES.

THE RIGHTS TOKEN

IF THE PRICE OF SINGULAR DEVIATES TOO
FAR FROM THE TARGET PRICE OF $1.00, THE
BITI PROTOCOL WILL SELL BOND TOKENS.

RIGHTS TOKEN HOLDERS CAN EARN A

PREMIUM ON THEIR BOND TOKEN OVER
TIME, AS THE SINGULAR PROTOCOL WILL
MINT MORE BOND TOKENS TO INCREASE
SUPPLY.
MITIGATING POTENTIAL RISKS TO
THE SINGULAR PROTOCOL

DECENTRALIZING THE
SINGULAR PROTOCOL

The initial version of the Singular The Singular token will start with one

protocol will be mostly centralized. token of Singular pegged to US $1.00, and

subsequently be released from the peg to

We are looking to make the Singular
US dollar in the future.
protocol decentralized over time as

we migrate the protocol to the

Similar to how central banks sell bonds to
decentralized network and the
bring down the supply of money in
protocol will not need any human
circulation, Right Token holder will be
judgement in the long term.
able to get an interest as the Bond tokens

will always trade less than 1 Singular.

We will also build a decentralized

Artificial Intelligence called Alpha

And like treasury bonds that are paid out
Brain to monitor and execute the
at some point in the future, the newly
Singular protocol where it will not
minted Bond token will be sold in the
be controlled by the founding team.
open marketplace for less than 1 Singular.

The Singular protocol operates under

certain conditions which includes

stabilizing the supply of tokens explained

in detail in the following pages.

INCREASING THE SUPPLY FOR BOND
TOKENS

SUPPLY OF TOKENS

Similar to how central banks sell The blockchain that creates new

bonds to bring down the supply of Singular token, it has to satisfy if there
money in circulation.
is a need for an expansion of the

Singular token supply in the first place 

Bonds Token Holders will be able to

get an interest as Bond tokens will

Bond tokens follow the FIFO (First-in
always trade less than 1 Singular.
First-out) method retiring the oldest

bond created in the last 5 years. Say the

And like treasury bonds that are paid
blockchain retires the first 100 Bond
out at some point in the future, the
tokens, and the price of Singular is still
newly minted Bond token will be
lower than $1.00, the Singular protocol
sold in the open marketplace for less
will then retire the next 500 tokens to
than 1 Singular.
bring it closer to $1.00 

Rights token holders will be able to sell

bonds and receive an interest. The

Singular protocol will determine if

expansion or contraction is needed in

the first place .

 DESIGNING A DEEP LEARNING NEURAL ARCHITECTURE
TO

STABILIZE SUPPLY OF TOKENS

To understand this, assuming if you bought a house and have a

mortgage when BTC was trading at $20,000. 6 months later, BTC

prices fell (like what we has seen in end of 2018), what used to

cost 50 BTC is now only 10 BTC. You will lose trust in BTC while

paying your monthly mortgage when you bought the house when

BTC was $20,000.

Suppose thousands others did the same, demand for BTC drops

even further and this is therefore called a deflationary spiral that

might lead to a drop in economic productivity like what we have

seen during a Market Recession.

Bitcoin’s supply is only limited to 21 million tokens. According to

Keynesian economic theory, to solve deflationary spirals, money

expansion is needed to create more money when price level starts

falling. But, this is not possible with Bitcoin where no additional

BTC can be minted.

Mechanism design is a field in economics that deals with setting

incentives and interaction rules among self-interested participants

 to achieve desired objectives of Biti token holders.

In game theory, we set the rules of a game, and by using deep

learning, study the behaviors that emerge. 

AphaBrain will be that agent engineered to gravitate towards the

desired outcome, creating stability following rules of the game,

the Singular protocol.

APLHABRAIN IS ENGINEERED

TO GRAVITATE TOWARDS A DESIRED

OUTCOME

The point of departure from the existing economics we make the

assumption of Token Holder’s valuations for token value cannot

take any value, but rather sampled from a fixed, probability

distribution. For instance, very unlikely anyone would pay $10,000

for a Big Mac.

Under these settings we introduce a representation of Bidders

preference and network infrastructure. The following will be

AlphaBrain’s the three representation of Token Holder’s

preferences :

Incentivize truthful reports from Rights Token Holders.

Optimizing the allocation for market price in question, from the

oracle system say, Binance, Coinbase, S&P500, Gold price, etc.

Place minimal economic burden on participants (minimal

transaction fee)

We show that with deep learning technology, AlphaBrain can learn

truthful mechanisms under a wide variety of settings, including

various distribution of new tokens, and arbitrary numbers of

participants. As the number of Singular token holders increases,

the resulting Singular protocol generalize over varying number of

participants.

Replicating what Hartford have done for modeling human strategic

behavior, AlphaBrain under reasonable assumptions, designing the

supply for that overlook the behavior of rational participants

towards desirable outcomes.

ALPHABRAIN

A NEURAL ARCHITECTURE TO THE SINGULAR

PROTOCOL:

MECHANISM Token demand and supply are a pillar of

DESIGN economics and the market protocol of choice
DEALS WITH for a significant portion of the Singular
CHOOSING FROM A
protocol.
SET OF K OF POSSIBLE
ALTERNATIVES,
By designing AlphaBrain as a cast to supervise

where we have a set of the function approximation problem, thus

sample, N={1,2,3,4,5,….n} unlocking the application of modern machine

of participants (Right learning methods, more specifically deep
Holders) who each
learning to stabilizing cryptocurrencies. One
have preferences,
example will be utilizing a neural architecture
expressed in monetary
terms. for designing truthful and efficient token supply

circulation.

ORDER FLOW ALLOCATION

DESIGN IS A FUNCTION TO MAP
RELATES TO SPECIFIC EACH BOND BIDDERS
CASE WHERE WE
HAVE SET OF BOND Q : N → P(B) , or B to a
QUEUES bundle of bids .  Here,
we create a subset of
The alternative set Q items B ⊆
I a bundle.
consists of all the
possible ways to
allocate the sale of
Bond to Buyers. The
proposed design can
also learn various
‘bidding languages’ or
P(I) will  be the power set of I which is,
set or outcomes
the set of all possible bids and asks for
bidders have within
Bonds Tokens. mapping each buyers or
the Singular token
platform. sellers i to a bundle of bids Q(i) I. ⊆
HOW ALPHABRAIN MITIGATE
BANK ATTACKS OR SHOCKS

The purpose of AlphaBrain is to achieve a

target price and create stability spread. To

make this possible, the quantity of Biti tokens

to trade is explained with this formula:

Each buyer or seller of Singular, with knowledge

of their own true preferences, reports what is

commonly referred to as a “type”: for each token.

AlphaBrain keeps the token supply high enough to

absorb shocks. AlphaBrain maintains the supply

level in accordance with the equilibrium target.

The Equilibrium Target is:

$1* Target Token Supply Ratio * Quantity of Biti Tokens

t ∈ T the bidder communicates to the mechanism

a valuation for that Bond Price θi(t) ∈ Θi. When

token holders submits a Bond token sale to the

mechanism lunation for that outcome θi(t) ∈ Θi.

The protocol will then select an allocation

according to a choice whether the participant is

selling a bond, getting a loan or expiring an

existing Bond to a choice rule k : Θ1 × Θ2 × Θ 3

... × Θ n → K which determines the repayment of

bonds and interest paid to bond holders.

 MICRO VIEW OF BOND TOKEN ISSUANCE

n is the borrowers’ payments

On the macro view of Token
using a payment rule ni : Θ1 × .
Right holders the protocol
. . × Θn → M, where ti is the
selects the group maximizing
payment for the ith borrowers.
allocation of bond token issuance

and this asymmetry in

Payments can also be negative in
information leads to strategic
which the Bond issuer can also
behavior:
pay participants.

Rational bond token holders will

After payments are completed
report whatever preference  θi
and the bond expires,
maximizes their utility under the
AlphaBrain thus derives a utility
mechanism (post payment). Let
ui(m, ti) = vi(k) − ti from the
θ−i represent all reports, truthful
interaction to calculate credit or
or otherwise, from all borrowers
default risk for each borrower.
but i, then rational Rights

Holders will report θi = arg max

The main goal of the design of

this protocol to to choose an

θ ∈ Θi ui(c(θ−i, θ), ti(θ−i, θ)).

efficient outcome: allocating

loans to those who has the best

ratings, similar to how bond

rating agencies are Standard &

Poor’s, Moody’s and Fitch.

These agencies rate a company’s

ability to repay its obligations.

 PURPOSE OF ALPHABRAIN

A common assumption is that we In this section we show how the

assume each Bond seller will problem of designing a

only care about the bonds and trustworthy bond issuance

interest they receive during the system can enable capital

life of a Bond. markets in hyperinflation

economies to get access to loans.

Bond sellers will also have Suppose John, from New York,

liquidation preference. When a United States would like to sell

borrower goes bankrupt, the 100 bonds for 0.9 Singular per

protocol pays money back to bond.

investors in a particular order as

it liquidates the collateralized When the blockchain decides to

asset. contract total token supply, to

chooses the orders , John’s 100

To sum up the state of our coins into bonds while the

objective of AlphaBrain: To blockchain will determine the

design a trustworthy and maturity date of the Bond.

allocative-efficient bond

issuance system, while keeping Meanwhile, Santiago in

the sale of Bond tokens Argentina wants to start a small

individually-rational and tied to business in Buenos Aires,

the overall token supply ratio. Santiago will then collateralize

an asset and receive a loan to

start his business. Throughout

the repayment, Santiago’s

repayment will be tracked in the

blockchain, ni : Θ1 × . . . × Θn

→ M, where ti is the payment for

the ith =Santiago.

If Santiago defaults, the protocol

will begin to liquidate the

collateralized asset and pay out

to investors in a particular order.

 ALLOCATIVE-EFFICIENT BOND ISSUANCE

Pursuing this goal of facilitating We introduced a novel way to

trust and efficient bond sale, we use modern day machine-

can introduce a representation of learning techniques to automated

efficient Token supply as a mechanism and blockchain

collection of counterfactual bond infrastructure to create a robust

issuance. problem formulation to learn

truthful and efficient bond token

Thus, we propose a network sale which affects the token

architecture to learn the supply of Singular.

payment rules based on our

representation of AlphaBrain Although mechanism design is a

which support various real time pillar of economics and social

bidding and arbitrary number of science, this shows that under

bidders. certain circumstances, the design

of Singular protocol can be

turned into a supervised learning

problem and a tool of statistical

learning and how deep learning

can benefit the overall Singular

protocol in the long run.

METHODOLOGY
HOW ALPHABRAIN IS DESIGNED AS A
SUPERVISED LEARNING TOOL

THE GROVES
REDISTRIBUTION MECHANISM

We will be using the Groves redistribution mechanism, as a

dominant stray which are truthful, efficient & individually rational.
To achieve high token supply, we take an automated mechanism
design approach to identify good participants of the Biti protocol.
More importantly, the methodology will let Right token holders to
learn mechanisms that are truthful in the strong sense and even
knowing the number of bidders at any given point of time.
METHODOLOGY
BUILDING A ROBUSTNESS TO THE ENTIRE SINGULAR
PROTOCOL

MULTI-UNIT BID AND ASK MARKETPLACE

An extension to various mechanism design which is a framework

of the Vickrey-Clarke-Groves mechanism presented in 1970, the
above example encapsulates a multi-unit bid and ask
marketplace. We contract this network input to compute the
Groves payment rule of redistribution for Investors. The
representation processed with a 2-layer CNN that extracts per-per-
participant distributed representation and track the periodic
repayment nth of participants.

The result? Building a variance to the Bond Queue, and

building a robustness to the entire Biti protocol.
 A NOVEL APPROACH OF AN EFFICIENT 
ALGORITHMIC CENTRAL BANK

An extension to various In sum, to mitigate the risk of

mechanism design which is a leaving bonds permanently

framework of the Vickrey- unpaid after an expiration makes

Clarke-Groves mechanism bonds generally riskier, the birth

presented in 1970, the above of Artificial Intelligence points

example encapsulates a multi- to a future where agent like

unit bid and ask marketplace. We AlphaBrain in a shared

contract this network input to environment to maximize

compute the Groves payment individual rewards, realizing the

rule of redistribution for vision of dApps and possibly

Investors. creating opportunities in hyper

inflationary economies.

Here, we introduced a novel

presentation of an efficient As we understand that no system

algorithmic central bank, and we is perfect, but a price stable

propose this network architecture token has never ever been

to learn about social-utility of all brought about the systemic

Singular holders and trustful financial system. Moving off the

behaviours. USD Peg, the Singular protocol

is designed to facilitate stability

once the portfolio of tokenized

assets has achieved stability. The

Singular token will then allow

fractional ownership of

collateral tokens.

The Singular protocol will have

a gold standard option in place

that will act as a hedge against

inflation if all other alternative

fails to stabilize money.

 CURRENT
ATTEMPTS AT STABLE COINS

Tether Tether’s company bank account

in Taiwanese banks and sending

Tether’s attempt to peg it’s value money via Wells Fargo poses

to one USD for every Tether coin risks to being shut down by the

it mints is the biggest stable US government. Thus, holding

token today with daily fiat reserves will not be a long

transaction of up to $8.4 billion. term solution for any company.

Although the company Tether Example includes Liberty

Ltd. guarantees people the ability Reserve, a Costa-Rica

to get back their USD, the US centralised digital currency

Attorney charged Tether for service that was seized by the

using $850 million to cover up U.S government in 2013. 

loses of their company and also

Tether was unable to prove the Tether’s centralised approach

missing funds of $850 million (the owners having complete

since mid-2018. control) over the supply of

Tether and U.S prosecutors are

still investigating whether

Tether was used to manipulate

the price of Bitcoin

Tether has no protocol built-in

and they can never replace fiat

because it is tied to the US

dollar

Tether might be a good

alternative to hold in

cryptocurrency exchange

wallets, but very few are willing

to hold onto it for significant

periods of time for the above

trust issues.
Reserve
However, the Collateral token

is designed to hold collateral

Reserve is a cryptocurrency that
tokens worth at least 100% of
scales supply with demand and is
all Reserve tokens. Again,
built to maintain 100% or more
Reserve is unsure which
on-chain collateral backing.
collateral tokens be will tied to,

it could be commodities,
Reserve’s proposed method of
currencies or securities.
managing the volatility includes

hedging. Hedging means a

If Reserve decides to hold all
combination of long or short
Reserve token value tokenized
positions in some assets and this
to say securities and if there is
will be costly and it is merely
a black swan event or the stock
impossible to achieve a 100%
market drops by 33.8% like in
hedged position.
2008, holders of Reserve will

start to withdraw their tokens

The Reserve protocol includes
converting it into cash. Reserve
three token system, the Reserve
will have to absorb the losses
token- pegged to one USD , the
or pay 66.2% less or risk
Reserve Rights token, and
destroying Reserve holders
Collateral tokens.
confidence.

If Reserve decides to hold all

Reserve token in a collateral

say Gold or Oil, as described

earlier in this paper, Gold and

Oil in the short term is still

volatile. What if a crisis like

major financial panic sends

Gold skyrockets or like what

we are seeing now with the

ongoing Trump China Trade

war (as of this writing Q3

2019)?
There is a big risk of sudden

price movement in whichever

underlying market Reserve

chooses to back its RSV.

Reserve claims it will stay

collateralized until 100% of

Reserve tokens are redeemed.

When there is a major move

just like in the financial

markets, people will likely start

to panic and this is when people

will dump the unstable, in

Reserve’s case, so called stable

but unstable fundamentally.

They can never create stability

if Reserve chooses either

securities, commodities,

currencies to back its RSV.  In

contrast, if investors wanted a

baked-in price reflection of the

S&P 500 or commodities they

could just buy the Vanguard

ETF , Currency ETF or SPDR

Gold Shares.
MakerDAO
Dai is backed by fiat, precious

metals or digital currencies

MakerDAO peg to one USD isn’t
which is volatile in nature.
really stable for the following
Although Dai adjusts to Dai
reasons.
target price changes, this will

not result in Dai being stable.

Dai’s softpeg to One USD is

not really pegged. The first

scenario, if Dai drops below 1,

Dai would implement higher

interest rates to decrease the

supply .

Dai is not scalable. Dai charges

users bigger fee to hold Dai. As

network size increases, the

equilibrium target drops to

negative. 

Dai Pooled Ether (PETH) will

be the only collateral type

accepted by Maker. If the price

of ETH drops significantly,

people invested in Dai would

want to withdraw in panic, if

Maker couldn’t fulfill the

withdrawals, trust in Dai will

be gone for good.

Basis
However, Basis suffers from

what is known as the death

Basis Bond & Share Token system
spiral, the expiration of bonds
to balance the supply of tokens is
in the Basis system is one of
an interesting one. Basis uses
the deepest and most interesting
algorithms to attain stability by
design choices. But Basis
replicating how the central banks
forcibly expire all bonds that
meet inflation targets.
have been in the Queue.

 
However, MakerDAO and Reserve
This is problematic for a few
don’t have to use Security Tokens
reasons. Firstly, If there is no
to buy up their stablecoins. Basis
demand for the Basis token, the
might have raised $300 million
system will be keep reducing
from prominent VC funds but the
the supply of Bond tokens and
project failed due to securities law
this will cause the price of
and current US regulatory law.
Basis token to drop to zero. 

Basis core operation is in the

"Singular intends to use the similar United States. The United

‘Bond tokens’ created by Basis that States tried to fit digital assets

will be made available to the public into regulation that was created

periodically and improving the decades ago before the internet

design of the Basis protocol." existed. Other countries like

Malta, Switzerland or the U.K

are beginning to recognize

digital assets as a new asset

class. The advent of a new

stable currency that is widely

used can be disruptive.

Although the above restrictions is

not a complete deal-breaker for a

stable coin in our opinion, it’s

important to remember that Basis

is useful as an enabler of other

marketplaces like dApps.

 CONCLUSION

With Price stability as the The result: as capital moved

fundamental building block and away from traditional sectors to

as the cryptocurrency technology fuel genuine market forces,

advances, this will help serve where? Into the tech sector.

users of hyper inflating Where the next Mark Zuckerberg

economies than use their local or Larry Page could come from

currencies. In this world of Venezuela, Argentina, Sudan or

digital asset better than cash, Malaysia creating thousands of

this will encourage the jobs in their local economies.

blockchain ecosystem to grow

like the dAppS economy. In today’s flat global

marketplace, there is no such

In fact, we might even see the thing as American product or

next blockchain-Uber or Airbnb Chinese product. The iPhone

using a price-stable token as it’s assembled in China which has

primary payment option.  most of it’s part from Asian or

European countries. Americans

In a world where governments might argue, what about trade

will start to support the use of deficits, where American jobs

stable cryptocurrencies to boost are being outsourced overseas?

the local economy. In a world

where capital and brainpower Griswold pointed that in the 90s,

would be directed into ventures U.S trade deficits tried and he

that meet people’s real-world concluded: trade deficits do not

needs and desires. cost jobs, the U.S economy has

actually grown faster and

Americans are in fact enjoying

higher purchasing power today.

CONCLUSION

In other words, trade deficit is Until very recently, few people in

meaningless in a globalized world policy circles would seriously

today.  Nathan Lewis wrote on entertain cryptocurrencies: a return

Forbes, stable money has never to stable money through the use of

caused a financial crises. blockchain.

As Adam Smith pointed, money is an We have also outlined the ideas to

instrument of communication and a allow the use of price-stable

promoter of trust. Money is simply a cryptocurrency especially in certain

tool, money measures wealth, but it developing countries and price-stable

does not create it. cryptocurrency as the catalyst for

dApps in the near future.

To achieve equilibrium, the economy

is not a fixed machine, but a To conclude this paper, we

dynamic, serendipitous mix of human introduced Singular, an algorithmic

effort, actions, needs and desires. decentralised implementation of

price-stable cryptocurrency as a

Yes, unpredictable black swan events medium of exchange.

might happen, but instead of

bureaucrats constantly arise to thwart What if we could solve this one

the entrepreneurial drive of young problem that could unlock solutions

people in developing nations, a to thousands more?

creation of price-stable currency

might successfully orchestrate the We believe one unit of Singular

economic activities of millions of should be portable, easy to store and

youth which will be the major most importantly, must be stable.

workforce in the next 10 years.

This work is a first step in this

People are seeking solutions direction.

especially in developing countries

and we are seen firsthand the

movement for alternative currencies.

CONTACT

IMPORTANT DISCLAIMER

We set out the goal of creating a

better price-stable digital asset. Before the Full Implementation

One that would be resistant to of the Singular Protocol and

hyperinflation, decentralized, Alpha Brain, the Bitinext core

and more stable and robust than team may publish updates to this

the cryptocurrencies that came white paper.

before it.

The purpose of this Whitepaper

If this succeeds, could create is to present Singular- A Price-

tremendous value for society Stable Cryptocurrency with an

especially in hyper inflationary Algorithmic Central Bank to

economies. If you would like to potential community members

connect with us, or to join us in who join the Singular

this movement that could shape community with the proposed

the next revolution in Fintech, Singular token launch.

drop us an email with the

authors email shown on the The information set forth should

cover page. not be considered exhaustive

and does not imply any elements

of a contractual relationship. Its

sole purpose is to provide

relevant and reasonable

information to potential token

holder in order for them to

determine whether to undertake

Terrence Hooi
a thorough analysis of the
Founder & CEO
company with the intent of
Singular- An Algorithmic Central

Bank acquiring Singular (ST) Tokens.

Please visit bitinext.com for the

most up-to-date documentation

of the Singular protocol.

REFERENCES

Venezuela: All you need to know about the crisis in

nine charts

https://www.bbc.com/news/world-latin-america-

46999668

Money- how the Destruction of the Dollar Threatens

the Economy- and What We Can Do About it. Steve

Forbes, Elizabeth Ames

Central Banking and Fintech—A Brave New World?

 https://www.imf.org/en/News/Articles/2017/09/28/sp09

2917-central-banking-and-fintech-a-brave-new-world

Efforts to Reduce the Trade Deficit Will Have

Unintended Negative Consequences

https://www.mercatus.org/publications/trade-and-

immigration/efforts-reduce-trade-deficit-will-have-

unintended-negative

A Neural Architecture for Designing Truthful and

Efficient Auctions

https://arxiv.org/pdf/1907.05181v1.pdf

Theodore Groves. Incentives in Teams. Econometrica,

41(4):617–631, 1973.
Deep Learning for Predicting Human Strategic

Behavior, Jason S. Hartford, James R. Wright, Kevin

Leyton-Brown https://papers.nips.cc/paper/6509-deep-

learning-for-predicting-human-strategic-behavior

Mingyu Guo and Vincent Conitzer. Optimal-in-

expectation redistribution mechanisms. Artificial

Intelligence, 174(5-6):363–381, 2010.

Redistribution Mechanisms for Assignment of

Heterogeneous Objects, S. P. Gujar-Y Narahari

Distributed Implementations of Vickrey-Clarke-

Groves Mechanisms, pages 261-268 

Could a crisis of confidence cause a death spiral in the

system? Basis https://www.basis.io/article/could-a-

crisis-of-confidence-cause