Little by little, cryptocurrencies are becoming a bigger part of the financial ecosystem. Mainstream platforms such as PayPal are allowing users to buy and sell digital assets, Bitcoin is attracting favorable column inches in newspapers, and countries are unveiling regulatory frameworks that allow virtual currencies to thrive.
But one startup argues that there’s a major hurdle that’s yet to be meaningfully addressed: Giving crypto enthusiasts a trusted marketplace where they can spend their coins freely.
DeFi For You says it is building an e-commerce platform that’s based on the Binance Smart Chain where goods can be bought, sold, rented and even pawned. The company’s founders believe the crypto space needs to build its own ecosystem where merchants and shoppers can transact, rather than wait for the likes of Amazon to wade into the space.
Whereas pawn shops have attracted a rather shady reputation in some parts of the world over recent years, DeFi For You believes this centuries-old approach to finance is a largely untapped market that could bolster levels of financial inclusion dramatically.
According to DeFi For You’s founders, the pawnbroking market is worth $14.5 billion in the U.S. alone — and $400 billion in South East Asia. But until now, this concept has struggled to make the leap into the online world because it has been impossible to achieve without smart contracts.
Through DeFi For You’s platform, users will be able to open their own pawn shops and lend money to people around the world while holding collateral in exchange. In a true form of decentralized finance, executives say this will enable consumers to become their own bank. Lenders and borrowers can determine the terms of any loan directly, with all this information stored in an irrefutable smart contract.
Blockchain’s benefits
In time, DeFi For You believes that this could enable billions of people who have been shut out from mainstream financial services to access loans in an easy way. To reduce the risk of someone defaulting on their obligations, it will be possible to verify the reputation of each user on the blockchain — offering a more modern alternative to old-fashioned credit scores.
The conditions offered for loans will depend on a lender’s reputation and the type of collateral they are willing to offer, with preferential terms offered to those who have a strong track record.
Those behind the project are building their infrastructure on the Binance Smart Chain, and a BEP20 smart contract token known as DFY is being created.
Although BSC is less decentralized than Ethereum, DeFi For You’s founders said they were drawn to this blockchain because of how it delivers quicker transaction fees and lower costs, with a block time of between three and five seconds.
Apps are going to be available on Apple’s App Store and via Google Play soon, putting the platform at the fingertips of anyone who owns an Android device or an iPhone.
DeFi For You was founded by Adam C. Chaplin, who was also one of the co-founders of the crypto-friendly travel site Travala.com.
In its white paper, the project explains that its goal is to make the global credit system much more inclusive than it is at present — and injecting some much-needed competition into the lending sector. “We believe access to credit is one of the most important tickets to success today,” the team added.
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