Hello, dear cryptoheads. Today is very special day, because it is first day of Flight Academy program supported and provided by Goldfinch. Me as a backer #Rustamone3058 will provide you most valuable and interesting information about Flight Academy program, the protocol, and the Backer role.
Let’s begin with introduction…
Goldfinch is probably a biggest missing piece of DeFi sector. And finally it is here. You might be very excited, so am I. But let’s get back to the topic.
Goldfinch is a decentralized platform that provides loans without collateral. And this is the crucial step that finally opens crypto lending to the majority of the world. Since launching a few months ago, the protocol has grown 2.5X with loans extended to borrowers across 7 countries: India, Indonesia, Mexico, Nigeria, Singapore, Thailand, and Vietnam.
Basically Goldfinch is some type of bridge to an entirely new level of borrowing capacity. This is what will finally allow crypto to break out into global debt markets.
Significant thing is that protocol have raised $11M in funding, led by Andreessen Horowitz (a16z crypto) along with a number of new investors including Mercy Corps Ventures, A Capital, SV Angel, Access Ventures, Divergence Ventures, Defi Alliance, Draft Ventures, Balaji Srinivasan, Wale Ayeni, Ryan Selkis, Jason Choi, Josh Hannah, Lisa Cuesta, Viktor Bunin, and others.
It’s an conspicuous group of people with a broad set of striking backgrounds — from builders in the crypto space, to veterans of tech startups, to experts in emerging markets.
So, the most informative thing about project is of course Goldfinch whitepaper that forms the basis for the protocol. This paper shows how the Goldfinch protocol solves Undercollateralized loan challenge.
The protocol uses a unique approach that centers around the principle of “trust through consensus” and has the ability to scale in a fully decentralized way. We encourage people who are passionate about this problem to join us on Discord and share your feedback.
Mission of protocol is to build a decentralized credit protocol that expands financial inclusion, and this is just the first step. Goldfinch is now hiring to help the Goldfinch protocol grow to the next level — join the team!
Goldfinch is announcing Backer Program. “What’s that?” you will ask for sure.
I am very happy that you are still reading my blog, because the most interesting part for community is right here and right now!
Backer program is incentivized program where members will pilot over the coming months, and it’s the first way for the community to start participating directly in the protocol. Even beyond Goldfinch, it’s the first time DeFi users will be able to provide crypto loans directly to emerging market borrowers.
This program is called Flight Academy, where members could complete tasks by learning about Goldfinch Protocol, discuss features of Goldfinch, find out new information and bring their contribution to a project.
Before we get to the “How the Goldfinch Protocol Works” we have to define: Why loans without collateral matter?
The total amount borrowed across crypto networks passed $4B, up from less than $200M a year ago. Yet even this growth dramatically underestimates the true potential of DeFi.
Honestly that is because all of this lending is overcollateralized. For every $1.00 someone borrows on these networks today, they must first put up ~$1.50 of another asset they already own.
This collateral requirement holds the whole system back. Removing this collateral requirement is key to crypto breaking out into global debt markets.
Goldfinch is here to use this huge opportunity by unlocking crypto lending for most people in the world with uncolleteralized loans.
How It Works?
The Goldfinch protocol has four core participants: Borrowers, Backers, Liquidity Providers, and Auditors.
Liquidity Providers supply capital to the Senior Pool. The protocol automatically allocates the Senior Pool to the senior tranches of Borrower Pools.
Borrowers propose pools (with terms like the interest rate) for the Backers to assess
Backers supply capital to the junior tranches of Borrower Pools.
This pretty simple scheme shows us the basics of Goldfinch protocol workflow.
Goldfinch is going to be a decentralized credit platform that empowers financial inclusion. And this is how Goldfinch vision looks like:
We believe there’s vast untapped lending potential in the world. It’s expensive to be a bank today, and this limits the kinds of lenders that can operate. But there are thousands if not millions who could lend with the right system. We’re building a platform that empowers anyone to be a lender, not just banks.
There are several phases that will introduce you key points of where we’re headed:
Build a “credit fund on crypto” that makes off-chain sources of yield available and composable on DeFi.
Decentralize the network to allow anyone to propose or evaluate loans, not just the Goldfinch team.
Support smaller and smaller lenders so that anyone can be a lender through the protocol, even individuals.
With all being said being a decentralized credit platform offering collateral-free loans makes Goldfinch stand out from the crowd as it allows a lot of people to enter the world of crypto.
I recommend to sign up for Goldfinch Newsletter it will allow you to always stay in tuned with updates and events.
Official Goldfinch Discord: https://discord.gg/mVGgdX8T