YENCoin (YEN) WhitePaper

ERC20 token as Prepaid Payment Instruments for Own Business

Summary
In this paper, we are going to propose a JPY-pegged stable coin, legally dealt as a Prepaid
Payment Instrument in Japan. In 2019, JPYC, the JPY-pegged stable coin, was issued, andJPYC created the market for stable coins in Japan. ​As a follow-up to JPYC, YEN will
streamline the cryptocurrency payment in buying and selling goods, for the public use as aPrepaid Payment Instrument. YEN will be an opportunity for a variety of businesses to issuestable coins in Japan.

1 Specifics of YEN

1.

Legal Position of YEN
YEN is one of the Prepaid Payment Instruments for Own Business issued by acompany under the Japanese laws. YEN is a currency-denominated asset so it is nota cryptocurrency legally. These days the market of the so-called DeFi (DecentralizedFinance) is rapidly expanding, and there is a DEX (Decentralized Exchange, nomiddleman exchanges) in the market, one of the most famous being Uniswap. YEN
holders are able to manage assets using such tools.

2.

Utility
2.1.

Items can be purchased in a ratio of 1 YEN to 1 Yen.
YEN is purchasable with JPY and it is usable on purchasing by items in aratio of 1 YEN to 1 Yen, regardless of the secondary distribution price.

2.2.

Various DeFi on Polygon is available
YEN is a ERC20 token, so different kinds of DeFi on Polygon are usable withYEN. For your information, the use of DeFi is at the sole discretion and risk ofeach user, and we are not responsible for any damages caused by the use ofDeFi. Please be aware of this in advance.

3.

Issuance amount of YEN
We will issue 9,999,999 YEN first and then sequentially issue more YEN.

2 Use Case
1. Use Case 1 “Payment on Goods by Cryptocurrency Holder”
The users holding cryptocurrency can purchase items in a ratio of 1 YEN to 1 Yen byrelying on us, about purchasing by proxy on E-commerce websites such as Amazon
when they want to buy something there and use cryptocurrency

2. Use Case 2 “Users who is going to Hold Cryptocurrency”
YEN users are able to manage assets, exchange YEN for ERC tokens provided asliquidity on DEX Uniswap along with MATIC and YEN on their own authority and attheir own risk.

3. Use Case 3 “Use of Decentralized Exchanges”
YEN users provide liquidity on a decentralized exchange Uniswap on their own
authority and at their own risk. When YEN liquidity is provided, people can exchange(swap) YEN for MATIC and all the other ERC20 tokens that can be traded on
Uniswap without the issuers’ approval. The more YEN is used for swap on Uniswap,
the more YEN, MATIC or other ERC20 tokens liquidity providers can get as rewards.

4. Use Case 4 “Use of Decentralized Lending Protocol”
YEN is a ERC20 token, which means technologically all the DeFi using ERC20tokens are available with YEN. For example, one can lend YEN throughdecentralized lending protocol, Compound at his or her sole discretion and risk. As ofJanuary 2022 YEN is not traded in Compound, but once the Compound community
approves of handling of YEN, everyone can lend YEN and get yield, or lend YEN bypaying yield. It’s up to the decision of the Compound community but as a rewardcontributing to Compound through these loans, you may also receive Compoundgovernance token, COMP.

5. Use Case 5 “Arbitration by DeFi Users”
YEN is a ERC20 token, so YEN holders can use all the DeFi based on ERC20tokens. DeFi is a developing market, thus there is a tendency for temporary pricedifferences in products with the same value to occur. In such a case, people canchoose arbitrage trading as a way to earn profits by selling the overvalued one andbuying the undervalued one, and then buying or selling the opposite one when theprice difference between the two narrows, under their own authority andresponsibility.

6. Use Case 6 “Buying goods of crypto artists”
YEN is technologically usable as all the other ERC20 tokens. Buying goods by crypto
artists who issue NFT (Non-fungible token) and conduct sales could happen, by
swapping and getting YEN such as on Uniswap.

3 How to Purchase YEN
1. Recommended Purchase Methods
Purchase methods the issuer recommends are twofold as follows.
1. purchase with Japanese Yen through the issuer’s website
2. purchase with Cryptocurrency through the issuer’s website
By making a payment through the issuer’s website using any of the above methods,
one can purchase at a ratio of 1 YEN to 1 Yen. However, in the case of continuous
trading at a much higher or lower price on Uniswap, we may temporarily suspend thesale until we identify the cause.

2. Other Purchase Methods
Buying YEN via decentralized exchanges with other ERC20 tokens is possible, suchas on Uniswap. However, there are always price fluctuations and we have noalliances with these exchanges at all, so in such cases one should take care of all,under your own authority and responsibility.

4 Disclaimer
Please be aware of and acknowledge the following risks before using YEN. YEN shall not beliable for any loss or damage arising from or in connection with any of the following risks.

1. Risk about Financial Value of YEN itself
YEN is not issued as securities, financial instruments, or any other investment
products under the Financial Instruments and Exchange Law, nor is it acryptocurrency under the Payment Services Act, but a currency issued as one of thePrepaid Payment Instruments for Own Business. Therefore, it is not guaranteed thatit can be used for any purposes we haven’t specified, and it cannot be used forsettlement between users.
Furthermore, since YEN is issued in accordance with the ERC20 standard, it ispossible to dispose of YEN on certain external services that accept the ERC20standard, but we do not recommend or guarantee this. YEN users are required touse external services under their own authority and responsibility.

2. Risk of Losing YEN due to the Loss of Private Key
Private key itself or a combination of private keys is required for the disposal of theusers’ YEN, and the management of the private key shall be under their own
authority and responsibility. The loss of the private key associated with the wallet
where the user’s YEN is stored means the loss of the YEN itself. Besides, loss ofYEN may be caused by phishing attacks, malware attacks, DoS attacks,
consensus-based attacks, or other various types of attacks.

3. Risk associated with Ethereum Protocol
YEN is based on Ethereum protocol ERC20, any Ethereum protocol malfunctions
may cause serious effect to YEN, and there might be some possibilities that YEN
cannot be used temporarily in such cases. Additionally, it requires transaction fees(gas fees) to use YEN and transfer money on the Ethereum network, but the fees
might skyrocket because of the cause we are not related to, like the congestion ofEthereum network.

4. Risk of Mining Attacks
YEN is, as well as the other decentralized cryptocurrencies based on the publicblockchain protocols, may be subject to attacks by mining during the verification ofthe transaction. These attacks may pose a risk to transaction records regarding YEN.

5. Risk of Change in Laws and Regulations, Risk of Taxation
YEN is subject to future changes in laws, ordinances, guidelines, and otherregulation or taxation systems related to YEN. In addition, users shall make decisions
as regards the necessity of filing tax returns and other taxation related YEN under
their own authority and responsibility.

6. Risk due to Input Errors by Users and Other Factors
There may be a risk of unintended transaction results due to input errors or otheractions caused by the user, malfunctions or operating conditions of the user’s or athird party’s communication or system equipment, natural disasters, cyber attacks, or
any other cause.

7. Relationships between Users
Any transactions, communications, disputes, etc., that arise between users and otherusers or third parties in connection with our website shall be handled and resolved
under the users’ own responsibility, and we shall not be responsible for such matters.

8. Risk associated with the Issuance or Suspension of YEN Circulation
We shall not be liable for any damages incurred by the user about the suspension,
termination, or modification of the issuance or distribution of YEN, deletion or loss of
the users’ messages or information, cancellation of the users’ registration, loss ofdata due use of the service, or malfunction or damage to equipment, or any othermatters.

9. Supplementary Provisions
This white paper is prepared and released on June 8, 2022.