The following diagram uses an example of a peer–to-peer remittance to illustrate how the DGCoin Blockchain intends to work to undertake an international remittance.
To begin as new users, individuals would need to open a new account (“DG Pay wallet”) in order for them to store their monies for future transfers. To ensure that they can complete their transfer they would also need their recipient to open a DG Pay wallet if they do not already have one. Once this has been done, users can initiate and complete their required money transfer. Users would however, need to deposit cash into their DG Pay wallet at a participating POS before they can make the transfer. After the money has been deposited into users’ DG Pay wallet they would then initiate a remittance instruction via the mobile app and money will be remitted to recipients’ DG Pay wallet immediately.
In the above example, we have an expat working in Singapore (Party A) who wishes to transfer SGD 500.00 back to Hong Kong. There is a total of 8 individual parties involved in the process of remitting SGD 500.00 to Hong Kong and to have it arrive in a total amount of HKD 2,897.30. This illustration assumes that all parties have DG Pay wallets and DGCoin wallets.
The process of remittance is broken down into the following steps:
Party A logs in to their DG Pay mobile app and requests a remittance order of SGD 500.00, from their Singapore DG Pay Wallet to be received by a Hong Kong DG Pay wallet owned by Party B.
An open purchase order of DGCoins corresponding to SGD 500.00 (in the illustrative case above being 500 DGCoins) is put onto the DGCoin blockchain.
Parties C,D and E each have placed requirements to sell their DGCoins, and the total number of DGCoins they wish to sell matches the open purchase order placed by Party A’s instruction to remit (see step 1).
The 500 DGCoins however do not go to Party A, instead, a second round of matching is performed, whereby the DGCoin Blockchain finds in Hong Kong Parties F,G and H, who have a combined requirement to buy 500 DGCoins for a total of HKD 2,897.30.
Parties F, G and H have already made a total payment of HKD 2,897.30 for their 500 DGCoins combined. However, this payment does not go to Parties C, D and E (see step 7).
A final confirmation is made electronically confirming that Party B is able to receive exactly HKD 2,897.30 with the conditions being met for steps 1 to 5.
The execution of transfer of SGD 500.00 from Party A to Parties C, D and E, the execution of transfer of 500 DGCoins from Parties C, D and E to Parties F, G and H, and the execution of transfer of HKD 2,897.30 combined from Parties F, G and H to Party B, and finally the transfer of a unique receipt from Party B to Party A for the receipt of HKD 2,897.30 which is equals to SGD 500.00 is done all at once.
The FIAT currencies will remain with an appropriately licensed agent of DG Pay. The above framework is dependent on a balanced trading volume between the domestic FIAT and domestic DGCoin in both regions, in order to ensure there are sellers and buyers of DGCoins on both sides to come together to satisfy the funds requirement of the remittance order.