xGov-52 Integrating the world of DeFi and the real economy

Author Jose Luis Uribe (@AtticusLScott), Camilo Cordovez , Juan Pablo Londono, Mario Castro

Category dApps

Focus DeFi

Open-Source Yes

ALGO Requested 1750000

Abstract

We have identified 2 main problems:
Problem 1: Idle Value of Crypto and Disconnect to Real Economy.
Problem 2: Enormous Finance gap in Lending for Small and Medium Enterprises (SME).

Our goal is to develop a powerful tool that serve as a bridge for the development of SMEs and individuals, who are the most important forces behind employment growth, innovation, and economic development.
The most significant growth barrier for SMEs is get external financing. To progress economic growth and combat poverty, it is essential to provide possibilities for SMEs in emerging markets.
What is Pack’s proposal?

  • Unlocking the true potential of crypto value and putting its huge idle value to use
  • Providing an investment alternative, for new and current crypto-holders, that allows them to perceive additional returns without the need to sell their assets
  • Creating a coherent connection between the crypto world and the real economy, one that supports growth and impact to SME’s and individuals
  • Empowering and supporting the alternative lenders by providing access to innovative capital sources for their growth and be able to push their vision and impact further

Pack Solution (Pack) is a platform that connects the two worlds, the crypto-world and the real economy.

PACK allows holders to earn additional returns while holding their assets and simultaneously providing critical liquidity to support Lenders and SMEs, contributing to the growth and use case of the crypto market to impact the real economy.

How? Pack is a financial alternative for crypto-holders who can fund and provide liquidity to SMEs and individuals of the real sector. To access the real economy, Pack will leverage on the track record, know-how and expertise of Lenders.
In return, investors will have higher annual yields than the ones offered by standard DeFi protocols and Lenders will have an innovative and alternative source of capital to grow their lending capacity.

Pack generates a liquidity pool coming from the collateralization produced by the investment of crypto-holders on a lending/borrowing Defi Protocol and directs this liquidity to provide loans to Lenders.
Pack solution model is not based on a P2P mechanism to connect crypto-holders and Lenders, but with the creation of liquidity pools it will provide a curated and diversified portfolio for investors, with the benefit of lowering risks

Link for details

1 Like

Hi Folks.
We are working on a solution to connect the power of Defi with the Real Economy. We strongly believe it will help the community to keep advancing and innovating. Please, let us know all your feedback, questions, and insights.
Regards.

interesting proposal! i have some questions:

  1. the project seems pretty ambitious, why are you not trying to get VCs money instead of using the xGov system? you are requesting almost all money available as this xGov fund is pretty small right now
  2. why should SMEs use PACK over the traditional system?
  3. higher returns come with higher risk: what is the collateral SMEs will use to get a loan? how do you ensure lenders get their money back?
  4. how would SMEs try to get a loan? how would they be screened to see if they are legit?