Opening note: As always, be aware that I can only report on this based on my understanding of the current situation and the current environment and it is possible that I may get some little bits of the puzzle wrong (albeit I am striving for perfection of course - aren't we all?).
There is still a degree of confusion about what, exactly, is happening to our KBC coins. So the aim in this message is to end that confusion and, hopefully, alleviate some of the fear that clearly exists about its future. I will preempt by saying that having studied what is going on in detail (as far as one can in a semi-secret environment) I am actually very happy with what Karatbars are doing and why they are doing it.
Of course, like you, I have no crystal ball and, like you, back in 2018 I looked forward to a very bright future by now with my KBC but the ride wasn't to be as easy as we all anticipated. The most important message I can give you right now is that I have seen cryptos in the past take years to do anything and then, 5 years down the road, they get there. Imagine giving up on Bitcoin in 2012, nearly four years into its existence when it was around $10 to $20 and then seeing it hit nearly $20,000 at the end of 2017.
Contrary to the conspiracy theorists out there who simply will not be silenced, everything Karatbars are doing now is designed to make them 100% bullet proof and totally compliant with legislation in every territory that they operate in. They, like us, want to see an end to fear mongering and accusations of foul play.
But, before I get into the "what" is happening with KBC, I need to try to explain the "why" it is happening. Many of you will not know that the legislative background controlling certain types of cryptocurrency has been changing quite dramatically over the years. To be honest, you'd have to be a crypto anorak like me to follow it.
Specifically, during 2019, crypto started to get more heavily regulated. In one particular area that regulation now has teeth and certain coins very much now have become classified as "securities" and under the new rules, KBC, if it had continued on its original path would need to have been reclassified as a "security". Easier said than done when it already exists in the wallets of many different people in many different territories and specifically proclaims itself to be a utility token in the original white paper.
In the interests of good information, crypto generally falls into one of two categories now, "security" token or "utility" token. There is arguably a third class which, for ease I will call "other". The most famous of the "other" category is Bitcoin although there could be an argument for calling it a "utility" token.
A utility token needs no more than to have a function beyond spending and/or exchanging its value for something else. Whenever you see a coin with a specific and primary purpose that isn't to hold value against a known currency or commodity value such as the US dollar or gold it is almost certainly classified as a utility token.
A good example is the Binance coin (BNB) which exists very much as a reward coin for activities on the Binance exchange - this makes it a utility coin. Another good example is a coin known as Basic Attention Token (BAT) which exists as a reward and payment system for good advertising on the Brave browser. And, of course, Ether which makes the whole Ethereum blockchain work. Hopefully, you get the gist of what a utility token is. Any token of course can be traded if it is listed on an exchange.
KBC was originally intended as both a form of security token (although it has never been referred to as that) and to function as a utility token. The original plan was to have it fully backed by gold right up until one KBC was equal to one gram of gold. Under current regulation that would make it 100% a security token and, as such, full compliance approval would be needed. Given the history of what has happened with KBC, that would never be granted or, at least, it would take too long and drain too many coffers to get there. Better to start a fresh with something new.
It is now very much the case that you can't have it both ways. A coin cannot be both a security and utility coin. And when now faced with the daunting task of complying with all the regulations around security tokens, Karatbars had to make a decision about how to move forward. It may well be that, in the end, all cryptos, security or otherwise need compliance and regulation but so far, this only now applies to security tokens.
Please bear in mind here that in 2018 when KBC was created, these two classifications of coin did not exist in any legal sense. We were still in the ICO madhouse phase where"anything goes".
The required use of KBC to run our upcoming new Mainnet blockchain and become the currency to fuel all of the tech now clearly outweighs the attraction of starting again with yet another new plan with KBC being purely a security coin. So, in their wisdom, Karatbars sought out a partner to help them launch a brand new, fully compliant, security token that would, from the start be 100% backed by gold. Enter the v999 coin.
One bit of confusion that I need to try to eradicate right away is this:
There is no connection between the KBC coin and the v999 coin. KBC is not becoming v999 and they are two very different entities. Having said that, after 15th October hard fork there will be a mechanism in place that allows the direct trading of KBC into v999 and, I understand (but don't quote me on this) at v999 pre-market terms. If you do not yet know what a hard fork is, can I suggest for now you google it.
I mention the above because I am getting far too many messages suggesting that the sender believes KBC will become v999 on 15th October. That is simply not the case. Not only are they two entirely different coins but v999 isn't even going to be listed as a Karatbars coin (as far as I know) but we, as Karatbars affiliates, are getting a special pre-market deal on it.
By the way, given where the economy is going now, if you don't get involved in v999 you are missing out on a great way to protect your wealth and convert some of your useless bank account cash into a real (income bearing) asset.
v999 will be managed and kept independently and audited by yet another third party and listed on its own unique exchange. By audited, in practice, this means the gold vault will be opened and checked monthly to be certain that there is one tenth of one gram of gold in that vault for every v999 in existence. How is all this monitored? Through a smart contract on the Stellar blockchain. Again, google it if you don't know what that is.
For the doubting Thomas's out there, karatbars will have zero involvement in this auditing operation. So it really will be totally independent from them.
Back to KBC...
All existing KBC that are sitting on Karatbit on 15th October 2020 will be exchanged for "NEW COIN" at a ratio of 4 existing to 1 new. This happens at the "hard fork". I don't know yet what the new coin will be called - maybe still KBC. Personally, I hope they give it a new name so that the old KBC disappears forever.
If you have your KBC stored somewhere else and they are not on karatbit on that day (it's fine if you've already used the reduction plan by the way) then in short you will no longer have the new KBC moving forward. If you do not respond to this required action you are, well, no polite way of putting this, you are crazy.
Just to be clear, this means you will almost certainly be holding a worthless token post 15th October if you do not take this action. If your KBC is already on Karatbit right now, no worries. That 4 to 1 exchange will happen on 15th October for you.
Reduction Plan
In July 2020, Reduction plan gives 25% extra monetary bonus.
In August 2020, reduction plan gives 15% extra monetary bonus.
In September 2020, reduction plan gives 10% extra monetary bonus. In October 2020 (until 14th October) reduction plan gives 7.5% extra bonus.
Reduction plan is a strange name don't you think? Well, not really because that is exactly what it is. A method for taking X coins now and turning them into 25% of X on 15th October. Why? This will create more scarcity and more demand. In short it is designed to accelerate the driving up of the price of this asset as less of the asset can exist. Regardless of how many KBC there were prior to 15th October, only 2 Billion will ever exist on the other side.
Does this reduction plan mean you will have only 25% of the value you had before? No, because the starting price of "NEW COIN" when it enters the market will be 4 times higher than KBC was on that day. The price will be the average KBC price according to coinmarketcap over that day. So if the price of KBC on 15th October moves between 0.004 and 0.005 the new coin price will be 0.0045 x 4 (0.018).
Can that price subsequently go down? Yes it can. It is going to be market driven. But in time, I genuinely believe it will move positively up. Everything Karatbars do after 15th october will be focused on getting that price up. And of course, if you took full advantage of the reduction plan and you put all of your KBC into the reduction plan during July 2020, then you would also have a 25% greater fund of cash to play with.
So if the value of KBC on the day you put them into the reduction plan was say $5,000 in total (please note I am using US dollars here as market prices work on US dollars) , you will be credited on 15th October with $6,250 of purchasing cash.
In simple mathematical terms, if "NEW COIN" has a price of 0.018 on 15th October, then instead of getting 277,778 "NEW COIN" because you had $5,000 to spend on it, you will get 347,222 "NEW COIN" as you had that extra $1,250 cash to spend.
So you see you don't need to be worried about what if the price of KBC goes up between now and 15th October. I confess that I was, at first, concerned by this until I found further clarification of how it will work. Do remember that 25% is only available up until 31st July then it drops as per the scale listed above.
The only price that is relevant is the 15th October price. If it is higher than today's price, you will get less new coins in total in the transfer (but enhanced by potentially 25% if you took the reduction plan). If the price goes down you will get more new coins in total in the transfer (but still enhanced if you took the reduction plan).
(Nb, these formulas and calculations can only be based on my interpretation for now until we actually get there, so if there are slight differences in the end please allow for the fact that I could only present you with what I believed to be accurate at the time with best intention. If I find that I have misinterpreted some of it prior to the event I will, of course, let you know.)
Other concerns regarding the reduction plan.
I have had people ask me what they are supposed to do if they have less than 10,000 KBC because that is the minimum number of coins you can put into the reduction plan. You have two options here.
The first option is go to the market and buy KBC until you have 10,000. Frankly, even if you bought 9,000 to get you there today it would cost you around $35.
The second option is to do nothing, just leave them on Karatbit and they will be converted on 15th October according to the 4 to 1 process. So if you have 4,000 KBC now you will get 1,000 "NEW COIN" on 15th October.
If you really wanted out of the whole thing for some reason, you can still sell your KBC on karatbit between now and 15th October for something else. Bitcoin, Etherium or even univals to get them into gold. This will be at whatever the market price is with no bonuses structure.
Conclusion:
I have concluded that Karatbars are doing the best they can in this new environment. Harald Seiz is determined to get KBC (or whatever it ends up as) right up there in value and make it one of the most sought after cryptos in the market. Leaving the bad press that followed the Steinberg debacle has proven to be pretty much impossible so he had to do something to move away from it. I think we now have a chance to see the coin get to where it should be.
I am also extremely keen on the new v999 project. It is not the first genuine gold backed coin (Kinesis for example is another very good one) but it is, in my opinion the best. I say this for three reasons.
1) It is the only fully compliant stable coin that will be convertible to 0.1 gram of gold per coin. 2) The ability to "own" a future income from each v999 based on you being the owner at its pre-market mint stage has terrific potential. Once you sell your original v999 into the market you will get transaction fees of 0.02% of the value exchanged form both buyer and seller for life. And then, having sold your v999 you can buy more with the proceeds. (Of course you could get unlucky and sell yours to someone who never parts with them and therefore only get the one fee income but that isn't too likely).
3) The v999 exchange, as I understand it, will have the ability to transfer cash into coin into gold and other cryptos and link to a debit/credit card.
Quick final points (or NB do not forgets).
If you have QR codes sitting on Karatbit, these will be swapped for v999 coins. However, make sure you have registered on www.v999.io to allow this to happen. In case you hadn't realised it, this means you can and are still getting one gram of gold for 100 KBC as the QR codes originally came from you swapping KBC into BUNV and generating the codes.
When you get to the v999 site, kick off the registration by entering karatbars and karatbarspass into the login form. You may have to do this twice before it works. Then fill out the details and follow the instructions.
As to any BUNV that are still sitting on your Karatbit account, these can be exchanged also for v999 at a rate of 7 BUNV for 1 v999. Do not underestimate the value of this exchange. During the original promotion we exchanged 100 KBC for 10 BUNV. If KBC was worth 2 cents a piece at the time, then 1 BUNV cost us 20 cents (I don't recall what KBC was actually worth but this is being generous I suspect). Therefore, 7 BUNV cost us, on that basis, $1.40.
So if you can now acquire one v999 for 7 BUNV and one v999 is worth the same as one tenth of a gram of gold (around $7) then you can see how good a deal that is. Sadly, I have no BUNV on my karatbit account but now wish I had converted more!
That's it from me today. I hope that rather lengthy but, I think, important breakdown helps.
John | 
