The other backbone of the financial system While ivyKoin and its payments network are one part of the new financial revolution, there’s another part that’s equally as important.
Debt.
Whether we like it or not, debt is the backbone of the existing financial system. And even in a new world, a new financial system, the debt will play a major role.
However, the current system of issuing debt and the new system doesn’t mesh. The banks aren’t going to give you a small business loan in BTC or ETH to help purchase capital equipment or to dip into a marketing budget to build your business.
That’s where your second crypto alert comes into play.
FintruX is building a lending ecosystem where users can access unsecured peer-to-peer financing.
It’s like crowdfunding debt but through a cryptocurrency network. FintruX has a demo account available on its site fintrux.com that you can use to experience what the platform will be like as a borrower, lender or administrator.
The difference between FintruX and any other kind of peer-to-peer lending platform is through its credit enhancement levels, which not only make it easier for borrowers to get unsecured loans but also provide safety for lenders helping to make lending more attractive and better rates to borrowers.
It explains this through its “Four cascading levels of credit enhancement”.
These are:
Over-collateralization acting as additional security; and if it fails to cover all losses arising from the same borrower, Third-party guarantors take care of the overflow losses from the above for the selected loans; and if it still fails, Cross-collateralization pool provides additional insurance; and if it still fails, Five (5)% of all FTX Tokens has been reserved to cover any losses incurred by lenders. The target market here is small business lending. That’s going to be the primary focus for FintruX, to begin with. Much how ivyKoin has identified a sweet spot for its transactions, FintruX has identified the market opportunity here is the small business.
Access to affordable credit to manage a small business is often critical to maintaining ongoing operation. Some businesses need access to credit to balance their debtors and creditors month to month.
Without credit facilities, many small businesses do not survive. But the traditional system often requires extensive, and onerous, and expensive means to provide a small business with credit. This is usually because it’s not economic for big financial institutions to afford our credit to potentially higher risk entities. So they charge through the teeth for it.
It’s why the likes of Amazon have recently started to get into small-business lending. More small businesses in operation, a more vibrant economy, and more people buy – you can see why Amazon’s so interested in it!
FintruX wants to hit this market with affordable unsecured credit by helping to manage credit and default risk for lenders while getting attractive rates for borrowers.
It does this through its FintruX platform and by overlaying its enhanced credit technology.
It gives a clearer picture of the borrower – from KYC/AML info to credit history, scoring and models, reputations ratings and their cascading credit enhancements.
And for the lender they too get reputation rankings, can create significant income streams from lending to more transparent borrowers and get a level of safety through the no-dispute smart contracts that govern the financing.
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