Rumors from the pub
Debitum Network

Solution – Debitum Network

Lending money is all about trust and its mechanical gears such as collateral, quantified reputation, and fear of punishment.  Using trust based blockchain solution Debitum Network ensures needed trust for all counterparties, especially investors, to operate within the ecosystem.  Debitum Network is based on three important pillars that ensure its uniqueness, disruptiveness as well as will ensure positive results on smalling the credit gap:

  • true decentralization
  • hybrid connecting crypto & fiat
  • trust based

True decentralization

There are 154 countries indicated by the World Bank where SMEs experience credit gap and where a solution like Debitum Network could help closing that gap by providing ecosystem of counterparties and connecting it with global investors. As Debitum Network is initial market maker and facilitator for solving worldwide credit gap by connecting SMEs with global investors who can rely on service provided by local or regional counterparties, i.e., verification, risk assessment, insurance, debt collection. It is possible to attract global investors to distribute available capital as well as attracting SMEs to borrow and finance their growth; however, to do the truly decentralized ecosystem, global service providers and self-service will be organized into “communities”.  Communities are the ones who solve problems by selling them members, community growth and other community – related tasks (on and outside the block). Each community will have a community leader that has additional features available for the community trust arbitration agreement.

HYBRID connecting crypto and fiat

Importantly, as crypto is not recognized as a traditional currency in most countries (except for Japan) and as most cryptocurrencies are too volatile. Incorporating loan-related capital transfers might serve as a fancy façade for any
project, but the interest in such a system will remain chiefly an academic one for years to come. Hence Debitum Network will use crypto currency only for other financing cycle related fees and guarantee-like token freezes. As far as borrowed capital is concerned, it can be seen as a “physical asset” that can be treated with off-the-blockchain with reference to it on blockchain.

TRUST based

By combining fiat operations and highly trustable and efficient blockchain based financing process Debitum Network will ensure high interest from SMEs and investors. As lending is primarily driven by trust in the borrower’s ability to
repay, Debitum Network will ensure that all transactions will interconnect with trust arbitrage smart contract that will provide objective trust rating for each single counterparty as well as communities of counterparties (i.e., risk assessors community in a single country). To ensure the objectivity Debitum Network’s trust arbitrage smart contract will be based on hard blockchain-based facts like services’ smart contracts engaged in, loan principal amount worked with and other.

Technical mechanics

Debitum Network requires strong architectural design and bullet proof technical implementation to ensure successful launch and usability of Debitum Network. The primary design goal of Debitum Network is to deliver the open system, which could not only communicate with ecosystem powered by blockchain but also that would be robust, easy to scale, and suitable for implementation for protocols needed for Debitum Network ecosystem. Users must have possibility to communicate with ecosystem not only through blockchain, but also by different system adapters using them through computer desktop or browser.

Token economy

To understand if Debitum token is sufficiently likely to gain value over time after the Crowdsale, it is important to apprehend token economy within Debitum Network ecosystem.

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