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Platform Workflow

Energy Substantiation connects suppliers with investors through a daily auction process.

The Core Flow

Supplier Creates Offer → Investor Places Order → Auction Matches → Tokens Issued → Settlement

1. Suppliers Create Offers

Energy suppliers offer to sell energy:

  • Specify quantity, discount and financing period
  • Retain physical custody of the commodity

2. Investors Place Orders

Investors place orders to acquire or redeem tokens:

  • Mint orders - Purchase new tokens
  • Burn orders - Redeem tokens for cash

3. Daily Auction

Each market day, the platform runs an auction:

  • Reference price for commodity is obtained
  • All matched orders execute at the same price
  • Supply and orders are matched and filled

4. Token Issuance

When orders match:

  • Investors receive tokens representing commodity exposure
  • Suppliers receive payment (minus their financing discount)
  • Obligations are recorded in the system

5. Settlement

When investors want to exit:

  • Trade via secondary crypto market 24x7x365
  • Provide tokens and submit a burn order
    • Receive cash at the current reference price
    • Tokens are destroyed

Key Participants

Participant Role
Suppliers Sell receipts for their commodity, receive upfront payment
Investors Hold tokens backed by those receipts
Custodian Audits suppliers, holds receipts, verifies commodity is still there
Platform Operates auction, maintains records

The Custodian's Role

An independent custodian ensures everything is on the level:

  • Audits suppliers - Evaluates suppliers during onboarding and determines their capacity
  • Holds receipts - When offers match, receipts are deposited with the custodian
  • Verifies regularly - Confirms the physical commodity backing each receipt is still there
  • Provides transparency - Publishes verification data so investors know tokens are backed 1:1

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