Thursday, September 14, 2017

Gold and asset backed cryptocurrencies could be next phase for peer to peer lending

When cryptocurrency models like GoldMint, OneGram, etc... introduced asset backed digital money, it was only a matter of time before the two pillars of saving and investing expanded into other forms of collateralized finance.  And according to one of the founders of GoldMint, the next phase for asset backed cryptocurrencies is their capacity to function in Peer 2 Peer lending.

GoldMint will change the way P2P lending works 
GoldMint is a comprehensive P2P solution that allows businesses like pawnshops to raise credit. 
“In Russia alone the portfolio of pawnshops (the collateral value of things in pawnshops) amounts to $1 bln and, naturally, in other countries it is not too small either: in Spain - $3 bln; in Great Britain - six bln pounds. This is a colossal amount!” 
These humongous portfolios are themselves what GoldMint aims to transform into a credit raising opportunity. 
Barriers like international borders, will dissipate with the ushering in of GoldMint, and people or entities will be able to lend to pawnshops and get returns on their extended loans. 
Custody Bot is the solution that GoldMint wants to use, to make sure that the collateral offered by pawnshops can be audited and verified. Custody Bot is a type of safe-like device with a built in spectrometer and hydrostatic balance.  
Once the gold is assessed by the Custody Bot, it can be stored safely till the time it is retrieved by the way of a special code unique to each item stored.   
The use of Custody Bot makes the whole process not only verifiable, but the device will also be able to relay information through to a Blockchain in a trustworthy manner. 
Lenders will profit, either as the owner will reclaim the stored gold in Custody Bot, or in the case of an unclaimed pledge it can be sold off by the pawnshop. – Coin Telegraph
For hundreds of years pawnshops acted as the primary lender for individuals and small businesses when big banks would only deal with corporations and sovereign governments.  And ironically since the 2008 financial crisis, banks have once again fallen back into their habits of the past, leaving innovative ideas like CrowdFunding and Peer 2 Peer lending as a means to offer a 21st century throwback to the idea of the pawnshop.

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