Ethereum Hackathon ETHDenver Partners With UNICEF on Blockchain Bounty System by Robert Greenfield

Screen Shot 2019-02-04 at 9.56.12 AM.png

By: Marie Huillet

Upcoming Ethereum (ETH) hardware hackathon ETHDenver is partnering with UNICEF on a blockchain bounty token system, according to a press release shared with Cointelegraph Jan. 31. The token aims to incentivize developers to create projects which promote social good, the press release notes.

ETHDenver — set to take place February 15-17 in Denver, Colorado — has partnered with UNICEF Ventures, UNICEF France and ETH startup Bounties Network on the prototype for what it calls a “positive action token,” the firm stated in the press release.

While the token is yet to have a name — indeed, its creators are appealing to ETHDenver attendees to contribute to finding one — it forms part of an incentivization program dubbed “The Impact Track.” As ETHDenver Diversity and Impact Steward Nick Rodrigues has outlined, the program encourages developers to think systematically about the positive social impact of a given piece of technical innovation:

“For example, if someone had a project where they happened to develop a way to shard more efficiently which therefore required less energy consumption, they would be meeting a sustainable development goal.”

As a non-monetary, value-driven community coin, the token cannot be redeemed for fiat currency, as the organizers report. Instead, users can use their tokens to get early access to future UNICEF and Impact Track events, mentorship sessions, incubator-style support, and similar offerings. ETHDenver has also pitched the token as “digital public acknowledgement of positive actions.”

In a separate blog post published Jan. 30, ETHDenver and blockchain startup MakerDAO (MKR) — creator of the Ethereum-collateralized stablecoin Dai (DAI) — have also announced the creation of an ETHDenver pop-up token economy based on an ephemeral “localcoin.”

Hackathon attendees will reportedly each be issued with a unique “xDai” wallet, which runs on their phone’s default web browser and is pre-loaded with the localcoin, dubbed “buffiDai.” The coin is pegged to the Dai and redeemable for food, drinks and activities at the event, the blog post reports.

As previously reported, the positive action token represents just one of UNICEF’s many forays into the blockchain space. Last month, the UNICEF Innovation Fund announced it would be investing $100,000 in six early stage and open-source blockchain companies working toward humanitarian goals.

In February of last year, the organization appealed to PC gamers to use their computers to mine ETH and donate their earnings to a charity campaign for Syrian children.

The Bifröst Initiative by Robert Greenfield

Haiti_ertaquake_Bonet008.jpg

Evolving the future of Cash Transfer Programming with cryptocurrency and blockchain technology

“70% of Syrian refugees have sold the aid they were given, in order to buy what they actually need.” — UNHCR 2014 Kurdistan Region Of Iraq Assessment Report

In 2010, the world was rocked by the devastating earthquake that crippled Haiti. Over 220,000 people lost their lives and another 1.5 million were left homeless. The world responded with the biggest donation drive in history, with a total of $3.5 billion USD raised for relief efforts. However much of this funding was misappropriated. The Red Cross alone spent nearly $125 million USD on its own internal expenses — a quarter of the donations the organization received. Such inefficiencies are common during relief efforts; charities on average spend 36.9% of donations on overheads, with many charities spending even more as there is no standard self-reporting practice for charities, and accounting practices differ wildly.

Overheads are only one aspect of the quality of a humanitarian response — at the end of the day, what is most important is the extent to which people who are affected by a crisis have their livelihoods improved. NGOs regularly fall short on this aspect as well.

People live or die after a crisis based on the aid that they receive in the first 72 hours. It is during this time that people are most vulnerable, where acute injuries take their toll and otherwise manageable issues such as access to clean drinking water, shelter and sanitation blow out to become huge problems. Current aid practices make it nearly impossible to properly respond to a crisis within two weeks. The time it takes to provide the proper support to people on the ground, determine an affected community’s needs, and spool up international supply chains to sustain donor support means that it often takes several months for NGOs to actually deliver relief. By this point, it is often tragically too late. When aid finally does get delivered to those affected, it is often the wrong type of aid. One study found that 70% of Syrian Refugees sold the aid they were given to buy what they actually needed.

What is Cash Transfer Programming?

At the core of these problems sits a system that’s just too complex; there’s too much that has to happen between an NGO coordinating the support and needs of a major crisis, and aid actually getting to the people who need it. High nonprofit overhead, high misalignment of community needs, and slow response times have all contributed to ineffective, albeit hopeful, approaches toward transformative aid disbursement.

Cash transfer programming (CTP) refers to all programs where cash (or vouchers for goods or services) is directly provided to program participants. It is an approach that builds upon linkages, capacities, incentives and relationships to encourage effective market recovery. CTP is a mechanism for delivering assistance; it is not a sector or program on its own. When done right, CTPs are orders of magnitude more effective than aid provided by traditional response, given that the international supply chain demands are exponentially less than coordinating the shipping of donated goods across the globe through dozens of intermediary organizations. Providing cash directly to under resourced community members also stimulates the affected area’s local economy and avoids unnecessary intermediary expenses, that, ultimately go back to companies established in westernized societies. Most importantly though, cash is empowering — giving affected people money and telling them that they are able to spend it in a way that works best for them sends a powerful message.

Cash aid has only recently become a viable way of delivering aid for the global community due to a few critical junctures:

  • The nature of humanitarian crises has changed. It is now rarely the case that people affected by a crisis find themselves stuck in a location where local infrastructure is completely devastated, or in refugee camps where no infrastructure existed in the first place. It is more often the case that destruction is localized, or that people are displaced from their home communities into other existing communities — a process known as urban displacement.

  • While financial inclusion globally is still low, technical penetration of basic telecommunications infrastructure is at a critical point, where most families will have access to a Mobile phone (though not a smartphone). This continues to be the case even after a crisis.

  • The weight of evidence is finally demonstrating the efficacy of cash programming, overturning decades of previous perceived wisdom.

While cash programming currently comprises only 10.3% of the 30 Billion USD that is spent on humanitarian response each year, it is projected to become the norm as large governmental donors demand the maximum effectiveness from social sector funds disbursed.

What is the Bifröst Initiative?

The Bifröst Initiative, originally named Project Bifröst and co-founded by ConsenSys Social Impact, MakerDAO, and Dether, is a collaborative effort between member organizations to affect positive change in the evolution of cash transfer programming by using cryptocurrency and blockchain technology. The initiative seeks to

  1. Create partnerships and add contributing organizations to the initiative

  2. Develop research publications on how different blockchain ecosystems can contribute toward the betterment of CTP solutions

  3. Make policy recommendations to address anti-money laundering and anti-terrorism finance laws on how to properly and legally leverage cryptocurrency transfers without crippling the social sector’s ability to leverage the technology for good

  4. Support blockchain-based social enterprises affecting positive change within the CTP vertical

  5. Develop sandbox experiments, leveraging the technology and teams of the Initiative’s member organizations and or selected social enterprises

The initiative, founded in the Spring of 2018, seeks to develop an inclusive ecosystem in which social sector organizations and technology companies work together to develop scalable, effective, and legal CTP solutions that can be leveraged on an international scale.

Projects & Partnerships So Far

Since its founding in Spring 2018, the Bifröst Initiative has accomplished the following:

Overall, with as little as 3 member organizations and 1 social enterprise member, the initiative has had a strong start at developing actionable steps to support an evolved CTP ecosystem.

A Call to Action to Evolve CTP

Moving forward into 2019, we hope to overcome additional obstacles that separate the work of technologists in the blockchain community from the subject matter expertise hosted by social sector organizations. Our core objectives are to:

  1. Invite additional members to the Bifröst Initiative from the social sector

  2. Release our first research publication on the evolution of CTP due to the influence of cryptocurrency and blockchain technology

  3. Release a collaboratively determined list of policy recommendations for regulators to consider when creating laws affecting money transfer

  4. Develop a grant program to further support strong social enterprises that develop CTP solutions using blockchain technology

  5. Select additional social enterprises to support via the initiative

  6. Host additional sandbox experiments to enable more people around the world to transact the value they need

  7. Have member representation from North America, South America, Europe, Africa and Asia

Initiative partners meet in tri-weekly sprints, during which we discuss strategies to achieve the aforementioned goals, and pursue other collaborative opportunities as well. Effort expenses, revenue, and press-release announcements are shared across initiative partners, depending on which partners are directly contributing to the effort in question.

How to Become an Initiative Partner

We invite any organizations interested in joining our cause. The core responsibilities of partner organizations are to:

  1. Contribute at least $2K to Initiative projects/efforts annually (per FY)

  2. Participate in at least 75% of tri-weekly meetings (via attendance) annually

  3. Propose and our contribute toward at least 2 Initiative projects annually

As you can see, we expect Initiative partners to contribute and collaborate as leaders at the cross-section of social impact and technology. If interested, please reach out directly here.

How to Earn Initiative Support as a Social Enterprise

If you are part of a social enterprise (startup, mid-sized company, or even developed company), we’d love to support your endeavors and create sandbox opportunities to demonstrate your technology. Such experiments are crucial to the mainstream adoption of solutions that leverage cryptocurrency and blockchain technology, and, through our partners, we hope to provide:

  1. Social sector partners to co-implement your solution in the context of an experiment

  2. Grant support to attend to product development and experiment implementation expenses

Note that teams with technical co-founders/members are preferred, as it is crucial for teams to be able to bootstrap their solutions as much as possible to extend their respective runways. If interested, please reach out directly here.


Bounties for the Oceans: Philippines Pilot by Robert Greenfield

Embarking on the first pilot for our social impact bounty project to prove feasibility and replicability

Looking towards decentralizing the social impact space, we started considering ways in which Bounties could help incentivize and organize positive global action across key UN initiatives. Having considered mechanics and usability, we launched the first bounty-based social impact project in partnership with MakerDAO back in June 2018, on World Oceans Day.

What is it?

The original bounty is very simple: pick up trash wherever you are, submit verifiable proof that you have done so, and receive 10 DAI as a reward.

Here are the key requirements of the original bounty:

  • Upload a photo of yourself with trash you have cleaned up from a park, beach, street, riverbank etc.

  • The photo must be at the cleanup site, with the day’s newspaper, a piece of paper with the date on it or camera date stamp

  • Live tweet your image, tag @MakerDao and @ethBounties using #bountiesfortheoceans and upload a screenshot

Check out the full details of the bounty and how you get started if you’d like to get involved.

The DAI bounty is still up and you can submit your cleanups. Specifically for the Philippines pilot, we recreated the bounty with an ETH payout in order to simplify the flow and enable a smooth coversion from ETH into Philippine Piso for the participants wanting to do so.

How Did it Do?

Since its launch in June, we have seen cleanups happen across the world, from the US to the UK, from Canada all the way to Venezuela and even Tasmania.

Screen Shot 2019-01-25 at 11.06.44 AM.png

Most of the people participating in our initial bounty were new to the blockchain space when fulfilling the bounty. It is this power of activating and empowering individual action that is most appealing about the model.

Philippines Pilot

The video below was shot on #WorldEnvironmentDay 2018 by Ian Redmond OBE, Ambassador for the UN Convention on Migratory Species, at Las Pinas-Paranaque Critical Habitat & EcoTourism Area in Manila Bay. The footage shows a volunteer cleanup happening in June this year and the need for further action is plain to see.

Our goal with the bounty-based cleanup in Manila is to re-engineer the flow of money and its distribution patterns, bridging the gap between social entrepreneurs, non-profit/NGOs and the general public. Fostering widespread and long-term behavioral shifts on a global scale will directly benefit communities, like Manila, that are intensely and increasingly affected by plastic waste. This new mechanism could also help create new jobs andvastly reduce the burdensome administrative costs afflicting most charity models today.

The overall plans extend far beyond this one project however. Imagine a borderless decentralized social impact contribution network — not only would a network like this drastically reduce the friction involved in global impact projects, but it would give individuals and organizations the tools to incentivize and activate millions of hours of human capital to collaborate towards positive social and environmental outcomes.

Contribute to the bounty or sign up as a volunteer

As part of the pilot, we are also partnering with Coins.ph on the ground so that the people participating in the cleanup can exchange their ETH into Philippine Piso and use the money to pay bills or buy groceries. The importance of having the full money flow loop is key when it comes to bridging the gap between crypto and the current financial setups. Coins.ph also offers cardless cash out from a wallet at any Security Bank ATM nationwide in the Philippines — a key requirement for working with the unbanked segment of the local population.

Here’s how you can join us & where:

Pilot Location

Las Pinas-Paranaque Critical Habitat & EcoTourism Area
Manila, Philippines

Date & Time

December 1, 2018: 8:00 AM — 5:00 PM
December 2, 2018: 8:00 AM — 5:00 PM

Reinventing Social Impact

As this is a time to create, test and improve, we will be documenting the pilot experience and results to try and understand what the implications and effects of running social impact projects on Ethereum are.

Our goal is to demonstrate feasibility, and hopefully, kickstart a powerful world-changing trend where blind trust is no longer a concept. Proof of action is.

Blind trust is no longer a concept. Proof of action is.

The second phase of the project will be the recycling & manufacturing of a product out of cleaned up plastic. Another cleanup in another region would see the bountied plastic be transported to a facility capable of turning plastic into fibre. Ideally this facility would be local to the cleanup area to limit carbon footprint.

The fibre would then be used to produce an item of clothing/footwear and be sold through a retailer. The funds raised would be put towards more social/environmental impact projects on the blockchain.

We are committed to collaborating in finding solutions for improving the world together so please join us, contribute to the bounty or sign up as a volunteer!

Become a part of our Bounties Slack community, sign up to our emails andfollow us on Twitter to follow all Bounty-based social impact progress.

My heartfelt thanks to everyone on our fully remote, fully collaborative, team and to everyone taking part in this initiative.

Here’s a Concrete Way to Put Your Cryptocurrency to Use for Florence Relief by Robert Greenfield

The Rockaways after Hurricane Sandy. (copyright Babita Patel)

The Rockaways after Hurricane Sandy. (copyright Babita Patel)

Hurricane Florence is likely to be disaster for the record books. Then again, so were last year’s hurricanes Harvey and Maria. Mega disasters appear to be the new norm, with damages in 2017 alone reaching $306 billion — the most expensive year on record in the United States. And when disasters strike, people want to help in any way possible.

Humans are fundamentally altruistic, eager to lend a helping hand, send supplies, or open their wallets to help their neighbors down the street or across the country. And yet, although individual donors gave $6.5 billion to humanitarian causes in 2017, enormous funding gaps consistently remain in any disaster response. A significant lack of evidence of organizational transparency and trust that donor funds will be used effectively has notably stifled giving.

Why is Aid So Inefficient?

Aid response is complex and expensive, with billions of dollars spent every year on staffing and logistics. It’s also a sector that’s prone to inefficiency and waste. So many institutions are involved in the transfer and deployment of cash. Subsequently, up to 10 percent of funds go into costly transaction fees every time money crosses borders; 70 cents out of every dollar are spent on logistics. It is estimated that charities spend almost 37 percent of donations on overhead costs during relief efforts, largely because the process of getting money from donors to organizations and then into the field is slow, expensive, and susceptible to fraud.

At NeedsList, we have been streamlining the process of getting supplies and cash into the hands of frontline disaster and aid groups through our platform, which allows donors to purchase supplies directly from local businesses to be sent to the field. Since we launched a year ago, donors have directed hundreds of thousands of dollars in resources–including supplies, donations, and volunteer hours–to hundreds of small aid organizations around the world doing effective, often overlooked humanitarian work. For us, the catastrophic disasters of 2017 were a wake up call. We didn’t only want to do more–we needed to do more. The increase in the number of natural disasters calls for new tech-enabled solutions to get money to where it’s needed more quickly than ever, and with more transparency.

Relief center in the Rockaways after Hurricane Sandy (copyright Babita Patel)

Relief center in the Rockaways after Hurricane Sandy (copyright Babita Patel)

How Cryptocurrency Can Help Streamline Aid

Today, we’re excited to launch a blockchain-enabled Disaster Response Campaign in partnership with Project Bifröst, a cryptocurrency payment system that’s making humanitarian aid response cheaper, faster, and more effective. Project Bifröst is the first venture created by ConsenSys Social Impact, a venture that uses Ethereum to create blockchain-based solutions to tackle urgent humanitarian needs.

For the first time, people can donate the Dai stablecoin (created by MakerDAO), a price-stabilized cryptocurrency pegged to the U.S. dollar, towards disaster relief and preparedness efforts in the U.S. and abroad. This means that for the first time, there is a value associated with crypto donations that is stable and not prone to fluctuation, which is the hallmark of other cryptocurrencies.

Here’s how it works: We’ll be collecting Dai into our Disaster Response Campaign on a rolling basis. Half all donations will be immediately deployed to purchase urgently needed, basic supplies from local businesses in communities around the world where there are active relief or recovery efforts are underway. The other half will be set aside for disaster preparedness for the future. Right now, we can purchase clothing and hygiene products from local vendors in Kerala to help organizations aiding flood victims. We can buy solar or battery-powered lanterns for hurricane-hit communities in Puerto Rico. And we can be fully prepared to help the dozens of organizations that will be first responders to the fallout from Hurricane Florence.

The long-term implications of using the Dai stablecoin in humanitarian response are obvious: getting traceable cash to organizations in need more quickly, without the waste and with few transfer fees, that can be spent locally.

Although blockchain is in its early days, its potential to revolutionize the aid sector is extremely promising. If we can increase trust in donor giving through the transparency and traceability that Dai provides, donors may be willing to give more generously to projects that will have a real impact on the lives of those in need.

We’re excited to be running this experiment in cryptocurrency-powered giving for hurricane relief for Florence. If you have some Dai or ether, you can donate here, and we do of course accept USD as well. We’ll be updating donors with an ongoing list of organizations their funds are being directed to as relief efforts get underway.

To learn more about how to buy Dai, or about Project Bifrost, go here.

Collateralizing Rural Loans with Non-fungible Tokens by Robert Greenfield

1_3vvsgrG0kgfn12oUmewRoA.jpg

“Globalization is exposing new fault lines — between urban and rural communities...” — Ban Ki-moon

As the world continues to modernize, and globalization becomes synonymous to ‘business as normal,’ banks have shifted their focus in the provision of financial services from small businesses and commercial accounts to multinational lending and complex offerings — offerings often targeted to appease large corporations, high net worth individuals, and large scale, for-profit interests.

This transitional focus has identified fault lines between urban and rural communities, emphasizing the lack of adequate access to basic financial services in agrarian areas. The over 3.41 billion people globally that reside in these regions have an innate desire, much like their urban counterparts, to develop and expand their businesses and economic opportunities in their respective localities.


Yang 2011

Yang 2011

So how can we extend these financial services in a convenient, transparent, and fair way given the current structure of traditional rural banking? Let’s take a look at what rural banking looks like, where inefficiencies limit its economic outcomes, and how further digitizing rural financial services can invite hundreds of millions of people into a new, unbanked, peer-to-peer economy of financial services.

Introduction to Rural Banking

Rural banks refer to financial institutions established in rural areas (typically agriculturally focused) to support local community members, their agricultural developments, and their locality’s overall economic development. Almost a quarter of the United States population lives in rural communities, and this percentage only increases across the international community (Supporting Mortgage Lending in Rural Communities, Brookings Institute). Contradictory to cultural belief in the U.S., these regions are comprised of large communities of color, which speaks to the macro-economic implications of how these communities fair socioeconomically during times of international recession (The Brookings Institution).

Rural banks typically provide simple financial tools, including bank accounts and loans. In most western nations, these loans usually represent home mortgages or agrarian business loans and are provided with the expectation of an interest payment as well as a relatively good credit assessment of the consumer. In most emerging economies in South America, Asia, and Africa, where the average consumer’s income is multiple order of magnitudes lower than their western consumer counterparts, and consumer credit reports may not be readily available, loans are provided on collateral like land, and, most recently, livestock.

So how do collateralized loans work? 

With this type of loan, you can borrow money by putting down an asset as collateral. Commonly referred to as “secured loans,” collateral loans are considered less risky because your lender can take your pledged assets if you default (LendingTree). Car loans and home loans (mortgages) are a perfect example — in both cases, a person has borrowed money while securing their loan with an asset.

Collateralized loans provided by rural banks in emerging economies typically leverage land and livestock as collateral, as many of their consumers either don’t have the credit reference, title documentation, or otherwise means to access other traditional loan services.

Rural Development, Consumerism, & Economic Growth

According to development economics, the main factors to promote economic growth can be divided into three aspects (Yang, 2010):

  1. Growth caused by capital input

  2. Growth caused by labor force input

  3. Growth caused by comprehensive elements such as management, science, technology and education

Proposed solutions that fuel such developmental growth must attend to the diverse array of financial demands in rural communities, including that of rural consumers, small and medium enterprises, and rural local governments.

The rural consumer segment is divided across three core consumer groups:

  1. Rich Rural Consumers— A small proportion of rich rural consumers are mainly non-agricultural by replacing the traditional agricultural production with new agricultural production (such as cultivation). They have great capital needs and definite plans for their capital use as well as the repayment term and hence little risk (Yang, 2010)

  2. Average Rural Consumers — Average rural consumers who take up a large proportion of the total rural population, have financial demands for both agricultural production (chemicals, seeds and so on) and living (children’s education, medical health). Due to the short cycle and strong seasonality, they mainly turn to their relatives and friends and they can repay their loans punctually if turning to banks (Yang, 2010)

  3. Impoverished Rural Consumers — Poverty stricken households have financial demands for medical care, food, housing, and so on, which embody great risks due to the large amount of capital and the long repayment term (Yang, 2010)

Small and medium enterprises typically employ the vast majority of laborers in rural economies and can also be divided into three sub-categories, including agricultural materials and production companies, supply and marketing companies, raw materials companies, and industrial/mining companies. Generally, agricultural companies call for less capital in their establishment and operation while the latter two call for either larger scales or a large amount of start-up capital and therefore need strong financial basis(Yang, 2010).

Local governments typically seek effective investment and financing channels more broadly to guarantee sound agriculture development and to provide necessary public materials (Yang, 2010).

Financial Difficulties of Rural Consumers

The financial difficulties that rural consumers face on a global scale can be divided into the following obstacles:

  1. Inconvenient travel time to the nearest bank to take advantage of available financial services

  2. In the presence of moral hazard, farmers will prefer not to borrow even though the loan would raise their expected productivity and income (Crop Price Indemnified Loans for Farmers). There is a well-established culture of ‘risk rationing’ across households who never tried to access the formal market because of the high risk associated with borrowing due to consequences of default,

  3. Higher interest levied by traditional banks to mitigate loan risk associated with rural consumers, who often do not have a ‘credit score’ or proper collateral to offer

  4. Inability to establish future markets and other risk management tools to decrease price variability in emerging economies due to a lack of infrastructure to support traditional market architecture (Crop Price Indemnified Loans for Farmers)

  5. Disproportionate and systemic control of the liabilities of minority communities (rural, ethnic, or otherwise) due to predatory state policies

  6. Social collateral, or ‘lending relationship strength,’ isn’t taken into consideration in westernized markets, creating a cultural dissonance between financial tools available and the people looking to use them. Relationship lending dominates in economies where the likelihood of strategic default is high because of an underdeveloped financial system with low transparency and weak legal enforcement (Egli et al., 2006).

  7. Information asymmetry between banks and farmers

  8. Lack of relevant education available in rural areas to decrease potential collateral requirements

  9. Available collateral documentation is not accepted by local lenders, or leads to a very slow legal process (particularly regarding land rights)

The common theme and message across these market obstacles is clear — the traditional mechanism of finance cannot adequately support rural consumer needs AND maintain a risk mitigated, capitalistic strategy. So how can we begin to disinter-mediate this operational friction within rural markets?

Tokenization of Non-Fungible Assets

As a very quick introduction before we move forward, we’ll need to touch on Non-Fungible Tokens, or tokens that represent non-fungible assets (otherwise known as ERC721 tokens). Examples of such tokens are as follows:

Screen Shot 2019-01-09 at 11.03.31 PM.png

Tokenized Real Estate — Meridio

Meridio converts individual properties into digital shares on the blockchain, seamlessly connecting diverse investors and asset owners to invest and trade. Home equity is a non-fungible asset that, traditionally, requires a massive amount of resources and risk to own. The paperwork associated with homeownership and every real estate transaction is far too much for any individual consumer to process, and there are many intermediaries between the initial offer and the closing agreement that inflate the cost of ownership. By tokenizing equity, and effectively securitizing ownership of a single property, the barrier to investment entry almost disappears, and proof of ownership and sale are all immutably recorded on the blockchain, so there is no need for keeping your fractional title in a lockbox.

Screen Shot 2019-01-09 at 11.03.42 PM.png


Tokenized Digital Assets — Cryptokitties

Cryptokitties is another example of non fungible tokens. In this case, we have unique digital assets in the form of cute kittens. The price of these assets are far more speculative than real estate, but they represent a perfect example for use case scenarios like artwork, music, and other non-fungible assets that draw their value from both cultural relevance and subjective valuation.

So if there’s already tokenized real estate, and tokenized kittens, why can’t there be other tokenized forms of non-fungible collateral operating within the rural banking space?

Digitizing the Rural Bank Loan Process

Many of the inefficiencies of rural banking stem from risk mitigation obstacles and lack of consumer access. Credit score structures, much like the FICO score in the United States, are few and far between in emerging economies, and oftentimes even those scores, when available, can be extremely subjective depending on the consumer’s ethnic background and credit security (if identity theft occurs). Even when proper credit and collateral is established, the process to prove ownership of such collateral and settle the transaction to afford a loan is a lengthy and stressful process.

By tokenizing commonly available forms of collateral in rural economies, like land and livestock, and developing commercial, monetary policies that govern expectations of the settlement process and which data must be available on the public chain to more easily verify asset ownership, the rural financing market can become much more liquid than it is now and rely on new forms of loans that aren’t issued just by central authorities.

In my article, Unbanked for Good, we delved into the high smartphone penetration in emerging economies, and the likelihood of these regions to leapfrog traditional methods of sending and accepting capital as they sprint towards a mobile-first, cashless society.

Therefore, it is no stretch of the imagination that, with the increased prevalence of stable cryptocurrencies like DAI, the development of new collateral assessment vehicles, and the development of new, legally recognized asset tokenization processes, that a rural consumer could:

  1. Document their available assets. This could be livestock, land, even recyclables — any material that could be commercially converted to value without too much operational friction

  2. Provide available means of ownership for those assets (or receive proof of ownership on chain when they acquire new assets)

  3. Enter a contract to tokenize their assets and undergo an assessment for the fiat value of that potential collateral

  4. Use those non-fungible tokens as collateral to apply for a loan

The goal — for this whole process to take place via their mobile device. Of course, such a process would (but doesn’t necessarily have to) rely on self-sovereign identity (which, at the start, could just be a public address with a certain transaction volume) and proof of location (see FOAM), among other elements, but the possibility is REAL.

Lastly, the loan will no longer need to be disbursed from a central authority, and information asymmetry will become a thing of the past. The process of ownership and asset-value assessment can be, in many ways, automated. Of course, guiding fiscal policy will still be necessary to protect both consumers and commercial entities. Peer-to-peer loaning systems could provide liquidity between western localities and rural economies, where the exchange of stablecoin loans for non-fungible token collateral occurs in mere minutes to represent international, collateralized loans. Liquidity to rural areas would no longer be in control by municipal banks, and people could affect fiscal change a world away from each other. Smart contract protocols could then evaluate on-chain history to more objectively determine portable credit scores to best mitigate risk of default or perjury in a proposed transaction. This is the ideal potential for social mobility across the urban-rural gap.

Rural Inclusion & New Economy Market Making

“New markets could be created by rural potentials, which could lead to rise in the employment.” — A. P. J. Abdul Kalam

There are revolutionary markets to be made by the tokenization of non-fungible assets. Increased liquidity in systems gridlocked by operational friction will release trillions of dollars in value into the global economy and, hopefully shift the world’s earning gap for the better. Whichever the case, it has become quite clear that traditional mechanisms of finance do not work for those who need it most, and it is crucial to dis-intermediate these systems so that we, as humanity, achieve equitable access to financial instruments and the lives that they can enable.


Bifröst: A New Blockchain-Based Effort to Deliver Foreign Aid Payments by Robert Greenfield

Oslo Freedom Forum 10th Anniversary

Oslo Freedom Forum 10th Anniversary

Original story authored by Nick Marinoff @ Bitcoin Magazine

ConsenSys Social Impact has joined hands with MakerDAO and Dether to launch Bifröst, a crypto-to-fiat payment system built to expedite the delivery of cash donations to aid groups in conflict areas.

Bifröst was announced during a presentation today, May 29, at the Oslo Freedom Forum in Norway. Executives are planning to pilot the system this summer within certain regions of Southeast Asia and the Middle East.

“Collaborative solutions like these … are paramount to materializing solutions in the social sector,” said Robby Greenfield, ConsenSys Social Impact’s global technical lead. “The Bifröst initiative looks to overcome both the inefficiencies in international aid and the user experience obstacles preventing mainstream adoption of today’s decentralized applications.”

ConsenSys is a blockchain venture production studio that builds decentralized applications on Ethereum; its Social Impact arm is tasked with addressing some of the world’s most pressing humanitarian issues using blockchain-based solutions.

Bifröst, ConsenSys Social Impact’s first venture, works by using smart contracts on the Ethereum blockchain to enable peer-to-peer value transfers, thus creating a more direct process for individuals to donate to particular causes. Banks are also taken out of the equation, thereby reducing fees and allowing more donation funds to be given to aid groups. Once a donation is made, MakerDAO and Dether deliver the funds to the scheduled recipients.

MakerDAO is the creator of the Dai stablecoin, which is price-stabilized against the value of USD, while Dether is a decentralized mobile app that connects aid groups with local businesses that exchange cryptocurrencies for cash, making donations more accessible to international parties. Dether allows organizations to accept Dai donations and provides the cash equivalent to specified aid groups.

“With Dether, people on the ground can get cash quickly and seamlessly,” said company co-founder Hamid Benyahia. “Because Dether is a peer-to-peer system that only requires a mobile phone with internet access, aid workers can work with the local population instead of a centralized bank. This is critical for the two billion unbanked adults across the globe.”

Bifröst claims it can deliver payments to associations in less than three days. Payees also incur transaction fees of less than 1 percent. Under normal circumstances, payments are usually delivered between three and four weeks, while transaction fees of 10 percent or higher are common.

Bifröst is ConsenSys Social Impact’s first attempt to branch into product development. “The expansion of emerging technologies into the humanitarian sector is enabling us to address global issues in innovative ways,” said Ben Siegel, the company’s global project and partnership lead. “We are honored to be announcing this project alongside not only MakerDAO and Dether, but also the Human Rights Foundation who played a key role in the early ideation of the platform.”

Building with Bounties: Co-dependent Social Impact by Robert Greenfield

Blockchain for Social Impact    in the Philippines with Waves for Water Building Filters

Blockchain for Social Impact in the Philippines with Waves for Water Building Filters

Recently, I had the opportunity to explore social impact opportunities in the conservation, luxury fashion, and banking industries in Australia, Hong Kong, and the Philippines. However, what started as a focused trip on developing large social impact partners transformed into a reinvigorated understanding of poverty, people, and humanity’s hierarchy of needs.

Blockchain Can’t Solve That

After exploring the vibrant and developing social impact ecosystem of Manila, our team flew down to Cebu, a southern Philippine state. We ventured off to Inayawan Dump site to distribute goods to village people in the area, collaborating with Glory Reborn, a nonprofit that focuses on providing compassionate and holistic care to marginalized moms and babies within the region.

We trudged through garbage, polluted streams, and swarms of flies only to come to the conclusion that there was no distinction between the landfill and the village itself. Humanity’s hierarchy of needs became evident — food, health, and access to education far outweigh the novel use of cryptocurrency and blockchain alone.

But how could we better identify where technology could be useful in the supply chain to provide the most basic needs in a more efficient, transparent, and accountable way? Oftentimes local and federal government agencies fall short of providing the services impoverished communities need, simply due to resource and budgetary constraints (and occasionally due to for profit business models).

In this brief, I investigate which needs may be best attended to in ecosystems starved of every basic necessity, and foolishly attempt to answer the question, where does blockchain fit into this devastating reality?

Previous Proposals for Bounties Use

In an early proposal made by the Bounties Network, we explored the way in which blockchain-based bounties can reinvent our social impact systems and incentivize action across local networks of nonprofits (and even the affected community members). Advents like Bounties Network, which enable users (individuals and/or organizations) to offer a reward to accomplish a specific task on-chain, have the potential to decentralize charitable incentives for nonprofit entities by requiring a proof of action in exchange for donated funds.

Development of Economic Zones by Activating Community Partners

Screen Shot 2019-01-09 at 11.11.39 PM.png

Partners Sharing a Platform

The most feasible strategy would be to ‘crowdfund’ resources in support of impoverished communities is to develop local partnerships between organizations that provide different services in the region. Intra-nonprofit communication is lacking within westernized and emerging economies alike. The non-standardization of aid cycles, education around the aid being provided, and programmatic expectations of the communities being serviced can create an inconsistent support experience for those attempting to form some sort of productive constancy in life.

We need to increase the commonality of social impact consortiums likeBlockchain for Social Impact at a local, working group level around the same platform of services. When stakeholders are aligned around a few set of communities (initially starting with one community), the hierarchy of needs of that society can be more consistently attended to. The issue with only disbursing food and water is that those needs only partially attend to community health discrepancies, and don’t attend to aspects of increased social mobility at all. Essentially, villages are kept in a pseudo-reliant state of social immobility, through which mere survival seems to be the glorified outcome.

The shared “platform” can be a standardization of aid cycles, the sharing of data across services to establish working identities for their clients, and even the standardization of aid education when services are rendered. Most likely however, these focuses will only truly align when funding is attached to co-dependent outcomes across nonprofits serving a similar area.

Co-dependent & Hyper Transparent Philanthropy

So what could this platform look like and how could Blockchain better attend to higher priority needs? To better align incentives across local nonprofits servicing a similar region of beneficiaries, co-dependent Bounties developed to efficiently coordinate collaborative & hyper-localized aid. By using payment mechanisms like DAI, nonprofits could receive their philanthropic rewards in a stable form of payment that is still beholden to an automated, escrow-like system, ensuring impact accountability for all organizational participants involved.

More accountable philanthropic disbursement across nonprofit consortiums servicing a locality can hopefully support better outcomes, empowering beneficiaries to climb out of poverty, rather than be supported during a life in it without end.

Developing these nonprofit consortiums by setting up co-dependent, locally focused bounties can potentially ensure

  1. Hierarchy of needs are met by organizations that focus on different categories of aid (food, clothing, water, housing, internet, etc.)

  2. Education is provided in tangent with aid, so that communities are left empowered and not dependent

  3. Aid is hyper-local by requirement of the bounty

Incentives for Better Communities

Once the initial needs are met (food, clothing, water, & housing), providing better infrastructure for the use of Internet can be prioritized. When reliable Internet services are available in under-resourced communities, social entrepreneurs can attend to a different set of problems via blockchain-enabled, user applications.

Models like Service-Backed Tokens become more applicable, as you help beneficiaries learn how to manage their resources and lead their communities by individualizing the benefits of aid. Of course, many other models may fit the mold as well. Individualized bounties within under-resourced communities could work as well, where members are incentivized to keep their localities clean, etc. Of course, the user experience of applications that interface community members would need to be exceptionally intuitive, well tested, and well researched.

Start with Nonprofits First

In the end, we must admit that blockchain alone does nothing for those in need of food and clean water — at least not directly on a day to day basis. What it can do is facilitate better coordination around the strategic funding and disbursement of aid, by first attending to a community’s hierarchy of needs.

By focusing on various tiers of need in a co-dependent fashion, we may be able to include under-resourced communities into our collective vision of a decentralized, cashless, and service-based economy sooner than we think.

Tokenizing Access to Social Services Pt. 2 by Robert Greenfield

1_F42Zg9WqQ9jWrWMB49SIVQ.png

“To give away money is an easy matter and in any man’s power. But to decide to whom to give it and how large and when, and for what purpose and how, is neither in every man’s power nor an easy matter.” — Aristotle

The following brief is a continuation of “Tokenizing Access to Social Services Pt. 1,” and emphasizes the new utility gained from tokenizing social service assets on-chain. Outside of the the economic gains in liquidity, there are also some new cryptoeconomic attributes to the model that (1) make it easier to fund social services in an accountable way, and (2) make it easier to distribute social services on an automated and on-going basis.

Peer-to-Peer Social Service Philanthropy

RFST models also open new funding methods to help support and sustain social services. Instead program’s being completely reliant on the due diligence and consensus of the federal government’s funding, philanthropists could donate funds to the RSFT smart contract, and, in doing so, mint tokens for waiting list candidates to use. In fact, this is exactly how the Bancor model’s Smart Tokens operate — new tokens are minted via the sale of the connecting liquidity token (that which backs the smart token).

As more liquidity is pumped into the system, the system has a greater ability to support the disbursement of services. Philanthropist contributions can be directly traced to the person they’ve helped, and these donors can be rewarded via tax credits for their charity.

The funding model introduces the capability for public services to leverage peer-to-peer funding to offset the sometimes inadequate funding provided by the federal government. Here’s what the donation process could look like:

  1. Web and or mobile application exists to take in donations to support a more generalized, cross-jurisdictional housing assistance fund that backs the minting of housing voucher tokens

  2. Philanthropist can choose which jurisdiction they’d like to contribute toward

  3. Philanthropist’s donation (most likely made in fiat currency) is converted to stablecoin (1:1) or tokenized fiat backing the housing voucher tokens.

  4. Ecosystem fractionally mints housing voucher tokens based on the salary and reported rent of next recipient in the waiting list of that jurisdiction’s housing authority (donation to housing voucher token minting ratio automatically calculated)

  5. New housing voucher tokens disbursed to recipient (once at least 12 months of housing assistance funding is secured from donations, i.e. 12 housing voucher tokens). All transactions are on-chain, making donations easily traceable, even when they are converted to housing voucher tokens

Airdropping for Social Impact

Another unique feature of a tokenized housing voucher model is the ability for housing authorities to disburse assistance to waitlisted recipients as soon as funding is availble using airdrop.

An airdrop for a cryptocurrency is a procedure of distributing tokens by awarding them to existing holders of a particular blockchain currency, such as Bitcoin or Ethereum. There are two ways creators distribute their tokens: selecting random wallets or publishing the event in airdrop lists.

Airdroping assistance can be automated for pre-approved, waitlisted recipients when funding mints new housing voucher tokens, saving the operational expenses and fighting recipient waitlist backlog.

Better User Experience: Abstracting Out the Blockchain

Of course, one major factor to develop a token model like this is to completely abstract out any mention of the blockchain from the user’s experience. Even the traditional representation of ERC20 wallets must be greatly simplified so that consumers can transact if they are sending each other credits or using Venmo.

For the development of this model, a lengthy and in-depth research and design spring is required to ensure that the user experience is one that is as beneficial and simple as the model’s backend operational benefits. A few UX obstacles to overcome are the following:

  • Easy flowing donations from fiat to stablecoin using debit and credit cards

  • Ensuring users never need to set gas for their transactions, and never have to pay transaction fees while transacting on the network

  • Private key management and wallet security to maintain their housing voucher tokens

  • Simple interface so that voucher recipients and landlords can easily transact (send & receive)

  • Simple accounting interface that summarizes statistics/analysis of network’s transactions for housing authorities

Building Sanboxable Use Cases

Of course, this is all great in theory, but the major issue with implementing models like this, particularly in western countries, is the government’s inability to exempt the public use of token models in local sandboxes. Doing so could generate a great amount of insight of how models like this can operate in a federally sponsored ecosystem, creating new policy for the cryptoeconomic world — and new assets for the social service world at large. If we can muster the research and concentration as a community to try these models out, we may develop cryptoeconomic models that further enable humanity’s ability to ensure everyone is fed, housed, and actively able to enhance the quality of their own lives.