# System Overview

**EDMA is a Layer 2 settlement rail governed by Proof of Verification (PoV): nothing settles until real-world evidence is independently verified.**

**In practice:** no evidence → no token → no settlement.

Data from meters, sensors, registries, and logistics systems is signed at the source, cross-checked by independent attestors, and anchored on-chain. Verified events mint proof objects at minimal gas cost; those proofs back market assets. When assets are moved or retired, settlement occurs in $EDM, and 50% of every fee burns.

### Lifecycle at a Glance

**Evidence → Proof → Asset → Settlement (EDM) → Burn → Audit trail on Ethereum**

### Runtime Rules (consistent across all routes)

* **Mints & conversions:** gas-minimal on EDMA L2 (proof creation should be practically free).
* **Settlement:** in $EDM; route-specific fees enforced on-chain; 50% of every fee burns.
* **Energy & Carbon:** 4% total (2% buyer + 2% seller).
* **Commodity milestones:** 0.5% per tranche, capped (enterprise-friendly).

### The Result

A **single settlement rail** where value moves on verified reality, not paperwork:

* **Faster time-to-cash**
* **Lower dispute rates**
* **Audit-ready records by default**

*What follows:* 

[Key Components (the pieces) ](https://docs.edma.app/how-edma-works/broken-reference)

[How It All Works Together (the flow)](https://docs.edma.app/how-edma-works/broken-reference)

[Tokenization Process (evidence → proofs → assets)](https://docs.edma.app/17.-appendix/claimid-fomulas)

[Blockchain & Contracts (Ethereum/Base architecture)](https://docs.edma.app/17.-appendix/gas-benchmark)

[Settlement & Fees (EDM Flow)](https://docs.edma.app/17.-appendix/contract-headers)

[Verification & Audit Layer](https://docs.edma.app/17.-appendix/kpis)

[Use Cases Powered by PoV.](https://docs.edma.app/how-edma-works/broken-reference)