Why UMI is a Step toward a Free Financial World

Quite recently, the world has seen a remarkable event — an anonymous bitcoin whale sent a total of $2.24 billion in a series of transactions. Large transactions are certainly not uncommon for the bitcoin network.

Whale Alert — blockchain tracker and analytics system — regularly reports large and interesting transactions. Although $2.24 billion is the largest ever cryptocurrency transfer, the most remarkable thing about this event is not the transfer amount but the incredibly little fee the sender paid for the transaction –– less than $1. With no checkups and intermediaries.

If such a transfer had happened a few years ago, it would have considered abnormal and unreal. Today it is a matter of fact. With each passing day, using cryptocurrency for making transfers is getting more attractive than bank transfers. The UMI network, which enables instant payments with no fees, fits in best with new realities. Let’s explore this issue.

Freedom from Bank Charges

The BTC whale sent the above-mentioned amount in seven successive transactions within one hour. The total amount was 241,500 BTC, which was equivalent to $2.24 bln. Each transfer cost around 0.0001 BTC or just $0.93, giving a total of about $6.51 for the seven transfers.

Let’s compare now how much you would be charged for an identical transfer in a bank.

In big banks, the international transfer fee is at least 1% of the amount, but it is often higher than that depending on the conditions. For instance, the VISA system charges 1 to 10% of the transaction amount for an international transfer (minimum of $10). Therefore, the more you transfer, the more you pay for it. To transfer the above-mentioned amount via a bank, a customer would have to part with as much as $22.4 mln (!!!), in the best-case scenario — that is if the fee is the minimum 1%. In other words, a bank would make a fortune — virtually at the drop of a hat, making no effort whatsoever — by simply taking someone’s money. What makes it more absurd is that banks intend to further raise their fees amid coronavirus pandemic.

Cryptocurrencies are a completely different story. In most cryptocurrency networks, fees do not depend on the transaction amount — the same fee could be charged for transferring $1 or $1 bln. In the cryptocurrency world, it doesn’t matter how much money you transfer. If you make a big transfer, no one makes you pay the “tithe”.  With UMI, you don’t have to pay anything to anyone — not a dime. But we’ll get back to this a little later.

Freedom from Excessive Limits and Unneeded Checkups

First, let’s consider another important factor — the very possibility to make unhindered transfers of large amounts via bank especially foreign transfers. The irony is that even if someone chooses to pay this multi-million dollar fee, the transfer would far from being 100% successful.

In most countries, including the Russian Federation, a $22 bln transaction would be virtually impossible to run in a state-owned bank, let alone private banks. Even going through a bunch of mandatory procedures as well as wasting lots of nerves and time wouldn’t save the day. This is why a payment of this size is virtually impossible:

  1. The overwhelming majority of the world’s banks just don’t happen to have such large amounts on their correspondent accounts. Even if we assume they do have sufficient funds on the books, this money doesn’t just sit idle — bankers use it in their own favor, for instance, to grant loans, make deposit payments, etc. No bank would agree to send all its reserve funds to another bank on your orders. Moreover, banks have no right to violate the law in terms of reserve requirements, including currency norms. And processing such a large amount contradicts the established rules and regulations. So, even if money is technically recorded on the customer’s account, transferring it to another bank, especially in a foreign country,   is still a virtually impossible task.
  2. In almost all states transactions of this scale are only allowed on the level of governments, the International Monetary Fund, the World Bank, or mega-tycoons with a declared multi-billion dollar income, such as Bill Gates, Warren Buffett, and the like. In other words, only customers with a special status can make especially large transfers without restrictions. Any “abnormal” transactions fall under suspicion and automatically frozen. If you have always run $500 transactions on a monthly basis, any incoming or outgoing $10,000 transfer would most probably be frozen. Let alone billions of dollars. An average owner of a large business will only be allowed to transfer billions of dollars after they get approval from FATF on an individual basis. Obviously, they must also be verified using KYC (Know Your Customer) and AML (Anti-money laundering) procedures and must establish the provenance of each dime they transfer. They have to do all this to transfer THEIR money, with a huge fee of billions of dollars.
  3. The situation is even worse because it is equally true for receiving monetary transfers. In other words, if you have a large amount successfully transferred to you, there is no guarantee that you can use this money. Sadly, even if the money leaves the sender’s bank, the recipient’s bank can instantly freeze it. On the very same day, you could get a visit from bank or government officials along with the state security service and a special interrogation. If you cannot provide provenance data for the funds, the transfer could easily remain frozen for good. Naturally, this system opens the doors for various types of abuse of power and manipulation by bankers, governments, and state services.

For the existing banking system, any big transaction makes you a suspect of some manipulations resulting in a frozen transfer. More importantly, it isn’t only true for multi-billion or multi-million transfers. Any transaction involving hundreds of thousands, dozens of thousands, or simply thousands of dollars may be deemed suspicious and sanctioned. It means that anyone who runs relatively big transactions runs the risk of encountering certain problems at any time.

Cryptocurrencies are a step toward free transfers

The above-described situation proves that digital money helps people get rid of many problems related to bank transfers: high fees, payment amount limits, specification of personal data, verification procedures. With digital money, you don’t have to prove or explain anything. This is a real revolution that makes people free from fees and manipulation. Cryptocurrencies allow people to be a master of their funds and no one has the power to change this. No one charges you crazy fees and no one can steal your coins.

With each passing minute, cryptocurrencies are becoming part of our life, and rather than profit from trading, investment, mining, or staking, they are regarded as a convenient way of sending funds. Only cryptocurrencies make people feel completely safe and allow them to transfer whatever amount wherever they want. This is a huge step towards changing the existing financial system, and it has already been made.

But UMI Goes Even Further

It may appear that problem with bank fees concerns only large businessmen. In real fact, regular people living live paycheck to paycheck are more sensitive to this issue. Being on a tight budget, most people have to pay for any bank transaction.

You always pay fees charged by banks — when you pay utility bills, buy online, deposit money to your bank card, receive money, transfer money between your accounts or withdraw cash from an ATM. Overall, bank fees cost people a lot of money. It’s curious to know how much your pay banks every year for mediation.

Now let’s see how you can make transactions using UMI.

In terms of fees, UMI is more profitable than banks and even more profitable than most of the other cryptocurrencies, including bitcoin. There are no fees in the UMI network at all, even hidden ones. All transactions are instant. That is, if you sent $2.24 billion through the UMI network, it would be instant and completely free. There are no limits, verifications, and other nervous procedures. Instant, free, and secure — here and now.

This is the key advantage of UMI as a payment instrument. Our cryptocurrency empowers all people — from large businessmen to factory workers — with profitable and absolutely safe funds transfers. UMI gives all people around the globe equal opportunities. This is the next step toward a free financial world. We are the first to make it.

Sincerely yours, UMI team