{"id":4665,"date":"2021-01-09T01:42:48","date_gmt":"2021-01-08T23:42:48","guid":{"rendered":"https:\/\/esatoshi.club\/?p=4665"},"modified":"2021-01-09T01:42:52","modified_gmt":"2021-01-08T23:42:52","slug":"smartcredit-io-x-satoshi-club-ama-recap-from-27th-of-december","status":"publish","type":"post","link":"https:\/\/satoshi-club.esipick.com\/index.php\/2021\/01\/09\/smartcredit-io-x-satoshi-club-ama-recap-from-27th-of-december\/","title":{"rendered":"SmartCredit.io x Satoshi Club AMA Recap from 27th of December"},"content":{"rendered":"\n

Welcome to another episode of our AMA series. Today we are glad to tell you about the AMA session with our friends from SmartCredit.io<\/a>. The AMA took place on December 27 and our guests were Martin Ploom (co-founder CEO) and Tarmo Ploom (Co-founder CTO).<\/p>\n\n\n\n

The total reward pool was 3000$ and\nwas divided into three parts. In this AMA Recap we will try to summarize some\nof the most interesting points for you.<\/p>\n\n\n\n

\n\n\n\n

PART 1, INTRODUCTION AND COMMUNITY QUESTIONS<\/strong><\/p>\n\n\n\n

D. | Satoshi Club: <\/strong>Hello Satoshi club! 👋\ntoday we are welcoming our guests from Smartcredit.io!<\/p>\n\n\n\n

Gold Rocket | Satoshi Club: <\/strong>Today our guests are @Martinikus<\/a> – Martin Ploom co-founder CEO &\n@TarmoPloom<\/a> – Tarmo Ploom Co-founder CTO.<\/p>\n\n\n\n

Martin Ploom | SmartCredit.io: <\/strong>Hello All, I’m very happy to be here\ntonight! And my past – I worked 10 years for Credit Suisse as a Vice President\nin Zurich. Before this I launched 4 successful software products and now\nSmartCredit.io!<\/p>\n\n\n\n

Tarmo: <\/strong>Hi, I am Tarmo, Co-Founder and CTO of SmartCredit.io. before\nstarting SmartCredit.io I was Chief-Architect of Finnova (it is the largest\nSwiss Banking Platform). And before that I worked for ten years as Vice\nPresident in Credit Suisse Global Architecture.<\/p>\n\n\n\n

D. | Satoshi Club: <\/strong>Awesome! thank you! can you tell as briefly\nabout your project?<\/p>\n\n\n\n

Martin Ploom | SmartCredit.io: <\/strong>What we are doing is DeFi\nlending\/borrowing, but it’s quite different from the money-market-funds like\nAave and Compound are.<\/p>\n\n\n\n

Our focus is on:<\/p>\n\n\n\n

  1. Fixed-term-loans<\/li>
  2. Fixed-interest-rate-loans<\/li>
  3. Fixed\nIncome funds<\/li><\/ol>\n\n\n\n

    Why is this important? It’s\nbecause the fixed-income-funds are 10x of money-market-funds in the traditional\nfinance, but fixed-income-funds are missing in DeFi. So, we add them.<\/p>\n\n\n\n

    D. | Satoshi Club: <\/strong>So you are first who did this?<\/p>\n\n\n\n

    Martin Ploom | SmartCredit.io: <\/strong>Yes, we are the first ones doing the\nfixed-income-funds. The DeFi is based so far on the money-market-funds. We add\nthe alternative – the fixed-income-funds. The money-market-funds have high\nflexibility, but high collateral ratios and fluctuating interest rates, the\nfixed-income-funds will have less flexibility, but lower collateral ratios and\nstable interest rates. So, every user can choose.<\/p>\n\n\n\n

    Tarmo: <\/strong>Fixed income funds help to reduce volatility and make outcome\npredictable for lenders and borrowers. In this way it can increase crypto\nadoption as volatility of outcome is reduced.<\/p>\n\n\n\n

    Q1 from Telegram user @sajay999<\/strong><\/p>\n\n\n\n

    The first phrase I see on the website is the you provide defi lending\nsolutions from Swiss bankers. Please elaborate on your background as Swiss\nbankers. In what banks are you working or have you worked and are they\nendorsing your activities related to blockchain?<\/em><\/p>\n\n\n\n

    Martin Ploom | SmartCredit.io:<\/strong> I worked 10 years for Credit-Suisse\nPrivate Banking as Vice President in Zurich. We are CFA’s – Chartered Financial\nAnalysts, we are MBA’s – everyhing what you need in the bank.<\/p>\n\n\n\n

    Regarding Credit-Suisse and\nblockchain. Unfortunately they are not supporting blockchain. It’s just because\nthey are very dependent from the SNB (Swiss National Bank – the central bank)\nand they try to read the central banks mind all the time 😉.<\/p>\n\n\n\n

    Tarmo: <\/strong>I was 10 years VP at Credit Suisse Global Architecture,\nafter that 2 and half years Chief Architect of Finnova. I know banking and\nSwiss banking inside out.<\/p>\n\n\n\n

    With SmartCredit.io we dont just\nbuild superior product we replicate brand values of Swiss Banking into DeFi:<\/p>\n\n\n\n

    1. Superior\nservice<\/li>
    2. Stability<\/li>
    3. Excellence<\/li><\/ol>\n\n\n\n

      D. | Satoshi Club: <\/strong>Okay, and what about your crypto experience? how\nlong are you in crypto world?<\/p>\n\n\n\n

      Martin Ploom | SmartCredit.io: <\/strong>So, we have the know-how inside out\nof the banking systems, credit-systems – and we just transfer this into the\nblockchain. We started in 2012.<\/p>\n\n\n\n

      Tarmo convinced me to do some\nBitcoin transactions and when we saw how this is working, then we became the\nCONVERTS. We published our first Bitcoin price forecast in 2014 January in the\nSwiss CFA magazine and the second one in the December 2017 in the Swiss CFA\nmagazine.<\/p>\n\n\n\n

      Tarmo: <\/strong>Yes, with some mining 😊 I didn\u2019t have to heat\nmy apartment in Zurich 😊.<\/p>\n\n\n\n

      D. | Satoshi Club: <\/strong>I\nthink stability it’s what more and more people are looking in DeFi and in\ncrypto in general, sometimes.<\/p>\n\n\n\n

      Martin Ploom |\nSmartCredit.io: <\/strong>Zurich was that time very good place to be – there were 2\ncore developers in Zurich and they spent a lot of time with people and of\ncourse, we discussed for days with them!<\/p>\n\n\n\n

      Tarmo: <\/strong>https:\/\/smartcredit.io\/bullish-case-for-bitcoin-price-valuation\/<\/a> <\/p>\n\n\n\n

      Martin Ploom |\nSmartCredit.io:<\/strong> So, our viewpoint is that Decentral Autonomous Banks will\nemerge. That the capabilities of traditional banks will be transferred into the\nblockchain. Well, then people started to use the word “DeFi” and then\nwe switched to the “DeFi” word too.<\/p>\n\n\n\n

      Tarmo:<\/strong> Decentral\nAutonomous Banks would replicate current 30 000 banks into Blockchain.<\/p>\n\n\n\n

      Martin Ploom |\nSmartCredit.io: <\/strong>Let’s think, that the finance is 5000 years old. The banks\nas we know them are 100 years old. Our approach is just to replicate the\nearlier approaches (before the banks era) into the blockchain.<\/p>\n\n\n\n

      Gold Rocket | Satoshi\nClub: <\/strong>This is very impressive. So is Zurich today a crypto banking center\ntoo?<\/p>\n\n\n\n

      Martin Ploom |\nSmartCredit.io: <\/strong>The Swiss regulator is very perfectionistic. They try to\nregulate everything. The result is rather over-regulation and the startups have\nvery though time there.<\/p>\n\n\n\n

      Tarmo: <\/strong>Current\nbanks are running on Web 0.0 (Mainframe) or Web 1.0 technology. Banks haven\u2019t\nmanaged transformation to Web 2.0 technology. As such there is not much future\nfor current Web 0.0 or Web 1.0 based banks.<\/p>\n\n\n\n

      Issue with Web 0.0 or Web 1.0 based banks is there cost\nbasis. They are not competitive with Web 3.0 technology (Blockchain).\nBlockchain based banking is at least 6 times cheaper as old technology based\nbanking<\/p>\n\n\n\n

      Martin Ploom |\nSmartCredit.io: <\/strong>However, the crypto banks are emerging – like SEBA and\nSygnum. They have their banking licenses now too. But let’s think – there are\n251 banking licenses in CH and ca 4 to 6 of them are focusing on crypto or are\ndoing some crypto services.<\/p>\n\n\n\n

      Q2 from Telegram user\n@iulya_i <\/strong><\/p>\n\n\n\n

      Personal\nFixed-Income-Fund will be your new feature in the next release. What exactly\ndoes it and how will I benefit from it?<\/em><\/p>\n\n\n\n

      Martin Ploom |\nSmartCredit.io:<\/strong>In the\ntraditional finance we have the concept of the money-market-funds and\nfixed-income-funds.<\/p>\n\n\n\n

      The money-market-funds are very flexible instrument, the\nborrower and lender both have very high flexibility. But this comes on cost.\nFirst, there are high collateral requirements for the borrowers’s because one\ndoesn\u2019t know the loan maturities. Second, there are fluctuating interest rates\nfor both sides. Both sides can have advantage or disadvantage from this. <\/p>\n\n\n\n

      Therefore the traditional finance has implemented\nfixed-income-funds, which give less flexibility, but more stability. The\nborrower’s and lender’s will get stable interest rates and the borrowers will\nhave less collateral requirements than the money market funds and Personal\nFixed Income Funds – they invest rules based into the borrowers\nfixed-term-loans. They are personal (i.e. no pooling of the assets), but they\nare _personal. Regarding pooling of the assets – like the money-market-funds\nare doing this – pooling and offering investment return on the pool is\nregulated activity. And it requires licenses earlier or later.<\/p>\n\n\n\n

      Tarmo: <\/strong>Yes at\nleast two lisences:<\/p>\n\n\n\n

      1. Fund management company<\/li>
      2. Fund lisence<\/li><\/ol>\n\n\n\n

        Are needed for it.<\/p>\n\n\n\n

        Martin Ploom |\nSmartCredit.io: <\/strong>However, if one stays pure P2P – like we are doing this or\nMakerDAO – then the pooling regulations do not apply. So, Personal Fixed Income\nFunds offer regulatory security and the stable income for the lenders. Our\nwebsite: https:\/\/smartcredit.io<\/a> <\/p>\n\n\n\n

        Our Community: https:\/\/t.me\/SmartCredit_Community<\/a>\nOur application: https:\/\/app.smartcredit.io<\/a>\nAnd our medium too: https:\/\/medium.com\/smartcredit-io<\/a>\nhttps:\/\/twitter.com\/smartcredit_io<\/a>\n<\/p>\n\n\n\n

        Q3 from Telegram user\n@b_dima <\/strong><\/p>\n\n\n\n

        I like that you have\nmany sections with information on your website. You can basically find\neverything there. But why not make it simpler? To lend ETH in 2 clicks for\nexample. I searched about this on your website and there are many steps to do\nand to read. In order to get more adoption, I suggest you try to simplify all\nthese steps. Let us know what do you think.<\/em><\/p>\n\n\n\n

        Martin Ploom |\nSmartCredit.io:<\/strong>Definitively –\nagreed. Our first version is the Release 1.0 – several simplifications can be\ndone. One of the features that we add is crypto-credit-score. It’s optional to\nthe borrowers, however borrowers who do the credit-score will have better\ncollateral and interest rate requirements.<\/p>\n\n\n\n

        So, the system needs to be from one side easy to use. And\nfrom other side – we have this extra functionality, which should be available\ntoo. But credit-score is more for the borrowers. The fixed-income-funds will be\nintroduced with the Release 1.1 and then the lenders will have really easy life<\/p>\n\n\n\n

        1. Choose the asset<\/li>
        2. Define the rules (or use the default rules)<\/li>
        3. Transfer the asset<\/li><\/ol>\n\n\n\n

          Q4 from Telegram user\n@wicksterr<\/strong><\/p>\n\n\n\n

          The mobile version is\na joke and basically it’s impossible to use. When do you plan to finish the\ndesign and development of a fully operational mobile version? In our days this\ncan make or break the ux of a project.<\/em><\/p>\n\n\n\n

          Martin Ploom |\nSmartCredit.io: <\/strong>Yes, we have focussed on the desktop version and the mobile\nversion has some shortcomings. However, our growth strategy is the integration\ninto other wallets. It will take some time, but we will be integrated into the\nWeb3 wallets and then everything is getting even simpler. This onboarding\nprocess is really outdated. We are just deploying a new version of the\nonboarding process into the Production, it looks the same as the main\napplication. Will be there in max 7 days.<\/p>\n\n\n\n

          Q5 from Telegram user\n@sato_nakamo<\/strong><\/p>\n\n\n\n

          What is the formula of\ncredit score creation and how much time does it take to create a good credit\nscore?<\/em><\/p>\n\n\n\n

          Martin Ploom |\nSmartCredit.io: <\/strong>Very-very-good question,but we cannot tell this to you – there is just algorithm behind.\nBut here are the key pieces of this algorithm:<\/p>\n\n\n\n

          1. We do blockchain analytics – the analytic like\nthe banks are doing in the credit process.<\/li>
          2. There is social media analysis – the user can\nenable his FB and LinkedIn profiles and we do some analytics there.<\/li>
          3. And then there is little psychometric test.<\/li><\/ol>\n\n\n\n

            Practically we calculate two parameters: <\/p>\n\n\n\n

            1. Capability to pay<\/li>
            2. Willingness to pay (users can have funds, but\ndecide the game the system)<\/li><\/ol>\n\n\n\n

              And both these parameters together result in the credit\nscore. Traditional banking has credit-score as a key feature. Every single bank\nclient has credit scores now. It’s possible that bank is not telling this to\nyou, but so it is. In DeFi we do not have the credit-scores – it’s like the\napproach “One shoe fits all”. The result of this is as well the heavy\novercollateralization in several systems. <\/p>\n\n\n\n

              So, we say – users have the option. Some users choose to\nstay fully anonymous – they have to pay for this – with more collateral and\nmore interest rate. Some users choose to open up their data – they will have\nthen better requirements, if they get a better score, we just offer to the\nusers a choice. But this is a rational choice, where every user can monetize\nhis data.<\/p>\n\n\n\n

              Gold Rocket | Satoshi\nClub: <\/strong>Great answer! Thank you! This means that you work according to\nbanking standards, but you have more opportunity to study the potential of the\nclient.<\/p>\n\n\n\n

              Martin Ploom |\nSmartCredit.io: <\/strong>Yes. We use the approaches from the banks. But banks are\nnot doing social media analysis or psychometric tests. Why? It’s because the\nlaw is writing what banks need to do for the credit score. So, the banks have\nthe “innovation via the law” 😉<\/p>\n\n\n\n

              Gold Rocket | Satoshi\nClub: <\/strong>This means \u041aYC is not necessary. Did I understand you correctly?<\/p>\n\n\n\n

              Martin Ploom |\nSmartCredit.io: <\/strong>KYC is not mandatory. However:<\/p>\n\n\n\n

              1. If the volume in month exceeds 15000 USD, then we will\nrequest this.<\/p>\n\n\n\n

              2. The borrower can always submit his KYC, but it’s not\nmandatory.<\/p>\n\n\n\n

              Q6 from Telegram user\n@batrud<\/strong><\/p>\n\n\n\n

              How does the crypto\nasset management work? Is there a team of professionals that manage this\nassets, like in the regular finance world? Also, what is the fee for this\nservice and do you provide any insurance regarding the results and the security\nof the funds?<\/em><\/p>\n\n\n\n

              Martin Ploom |\nSmartCredit.io: <\/strong>When we say crypto asset management, then we refer to our\nfixed-income-funds (at the moment). The fixed-income-funds will not have any\nfees for the lenders (except the gas to create one). The borrower’s however\nhave to pay the platform fee (0.5%) and the Loss Provision Fund fee (which is\ncredit-score dependent).<\/p>\n\n\n\n

              However, back to crypto asset management, we are thinking\nabout simple scanarios (after the Release 1.1). For example:<\/p>\n\n\n\n

              1. An investor will take a collateralized loan with lower\ncollateral ratio than the money-market-funds (Aave, Compound).<\/p>\n\n\n\n

              2. Investor sends the funds into the yield protocols.<\/p>\n\n\n\n

              Because the step (1) gives higher “capability to\nborrow” to the investors, then they will have as well higher return via\nthe yield protocol. So, we plan to integrate these functions after the Release\n1.1 (Release 1.2). Additionally, we will integrate Fiat on-ramping and Fiat\noff-ramping into our platform via our partners (but this will require KYC). So,\nthe crypto asset management contains:<\/p>\n\n\n\n

              1. Fiat bridges<\/li>
              2. Fixed income funds<\/li>
              3. Access to yield protocols<\/li><\/ol>\n\n\n\n

                As a summary before the chat:<\/p>\n\n\n\n

                1. Our project is a multi-year project, with many features\nthere already and many features to come.<\/p>\n\n\n\n

                2.We just offer choice to the users – for the borrowers, for\nthe lenders, for the integrators.<\/p>\n\n\n\n

                D. | Satoshi Club:<\/strong>\nAnd do you provide any insurance on your platform? <\/p>\n\n\n\n

                Martin Ploom |\nSmartCredit.io: <\/strong>We have the Loss Provision Fund in the platform, from every\ninterest payment a piece is going into the Loss Provision Fund. This system is\nthere for the unknown events.<\/p>\n\n\n\n

                \n\n\n\n

                PART 2, TELEGRAM COMMUNITY LIVE\nQUESTIONS<\/strong><\/p>\n\n\n\n

                The\nchat was open for 120 seconds; a lot of questions were posted by Satoshi Club\ncommunity. Our guests chose some of them. <\/p>\n\n\n\n

                Q1 from Telegram User<\/strong> @K2ice<\/strong><\/p>\n\n\n\n

                What benefits are on the SmartCredit\nplatform for the following categories of users: (1) An active borrower on the\nsystem (2) A lender on the system (3) A partner company, which would integrate\nthe platform\u2019s borrower or lender widgets.<\/em><\/p>\n\n\n\n

                Martin Ploom |\nSmartCredit.io: <\/strong>Here are the key benefits:<\/p>\n\n\n\n

                Borrower will get:<\/p>\n\n\n\n

                1. Lower collateral ratio than the\nmoney-market-funds<\/li>
                2. Stable interest rate<\/li>
                3. Can monetize his data via the\ncrypto-credit-score<\/em><\/li><\/ol>\n\n\n\n

                  Lender will\nget:<\/p>\n\n\n\n

                  1. Personal Fixed Income funds<\/li>
                  2. Stable interest rate<\/li>
                  3. Higher utilization ratio of the lent\nmoney than the money-market-protocols – this means higher real income<\/li><\/ol>\n\n\n\n

                    Integrators\nwill have:<\/p>\n\n\n\n

                    1. We share the revenues with them<\/li>
                    2. They will receive reward tokens too<\/li><\/ol>\n\n\n\n

                      Q2 from Telegram User @smelekin<\/strong><\/p>\n\n\n\n

                      You have a woman in\nyour team. This is very nice to see woman in this market. Can you tell about\nher to us?<\/em><\/p>\n\n\n\n

                      Tarmo: <\/strong>Woman are\nnecessary for every high performance team. As a result, social\nintelligence\/emotional intelligence improves, decisions are better and team performance\nimproves massively! Our Wunder-Woman is Basak from Turkey. She is Woman in\nIstanbul Co-Chair. She is brilliant!<\/p>\n\n\n\n

                      Q3 from Telegram User @atillayeni<\/strong><\/p>\n\n\n\n

                      Can everyone make a\nloan request from SmartCredit? What’re the requirements for a loan to approve?<\/em><\/p>\n\n\n\n

                      Tarmo: <\/strong>Yes,\neverybody who has registered in the app.smartcredit.io application can make loan\nrequests. Current currencies supported are ETH and DAI. To make loan request\nyou have deposit collateral (currently BAT, ZRX, REP) In Release 1.1 we add two\nmore stablecoins and ten more collaterals.<\/p>\n\n\n\n

                      Q4 from Telegram User @Sangdz<\/strong><\/p>\n\n\n\n

                      What is your plan for\nglobal expansion? At present, which market are you focus on, or is it focused\non building and growing to gain customers, users and partners?<\/em><\/p>\n\n\n\n

                      Martin Ploom |\nSmartCredit.io: <\/strong>At the moment we have English speaking community and our\napplication user interface is in English too. We are adding two communities:<\/p>\n\n\n\n

                      1. Spanish<\/p>\n\n\n\n

                      2. Turkish<\/p>\n\n\n\n

                      So, we have to translate our website and our application\ninto Spanish and Turkish. More communities will follow, but we are just starting\nwith these two at the moment.<\/p>\n\n\n\n

                      Additionally, we focus very much on the partnerships. We\nhave announced two of them (piixpay and cryptotask). The idea is that other\nplatforms can offer our services via the User Interface Widgets or via the API.\nAnd we split the revenue with the other platforms. The benefit for us – new\nusers. The benefit for the integrators – more services to their users (plus\nrevenues from the loan origination).<\/p>\n\n\n\n

                      Q5 from Telegram User @HTaraca<\/strong><\/p>\n\n\n\n

                      How do you ensure that\nyour lendings are fully recovered from those given to? What approach do you\ntake to ensure that borrowed funds are collected?<\/em><\/p>\n\n\n\n

                      Martin Ploom |\nSmartCredit.io: <\/strong>1. Our loans are over-collateralized. But our collateral\nratio is lower than the collateral ratio in the money-market-funds (Aave,\nCompound).<\/p>\n\n\n\n

                      2. When the collateral value declines, then the collateral\nis getting liquidated.<\/p>\n\n\n\n

                      3. And we have the Loss-Provision-Fund for the unknown\nevents – every borrower is paying into the Loss Provision Fund depending on his\ncredit score (when he has not done any credit score, then he will be in the\n“standard” credit score.<\/p>\n\n\n\n

                      Q6 from Telegram User @hanahho0107<\/strong><\/p>\n\n\n\n

                      Can you share with us\nthe highlights of the Credit as a service API product? If I am new, where can I\nfind guidance?<\/em><\/p>\n\n\n\n

                      Tarmo:<\/strong> We publish\nall our functionality as an API. As such other banks or websites can easily\nintegrate smartcredit.io and earn additional revenue stream.<\/p>\n\n\n\n

                      Q7 from Telegram User @Emidm37<\/strong><\/p>\n\n\n\n

                      Is the minimum and\nmaximum limit for borrowing the same for all users? Have you not thought of\ncreating a reputation program where users with higher reputations have higher\nlimits for borrowing?<\/em><\/p>\n\n\n\n

                      Tarmo: <\/strong>Minimum is\n100 USD equivalent in DAI or in ETH. There is no maximum. However we calculate\nborrowers credit score. Credit score determines borrowers interest and\ncollateral requirements.<\/p>\n\n\n\n

                      Q8 from Telegram User @BERTA2020<\/strong><\/p>\n\n\n\n

                      Can you give me 3 or\nmore features with which Smartcredit takes advantage of other similar projects\nand what outstanding benefits does it offer to users who choose your project\nand not others?<\/em><\/p>\n\n\n\n

                      Martin Ploom |\nSmartCredit.io: <\/strong>I would says following:<\/p>\n\n\n\n

                      1. The low collateral ratio for the borrowers – having fixed\nterm loans allows us to offer lower collateral ratio to the borrowers than the\nmoney-market-funds (Aave, Compound).<\/p>\n\n\n\n

                      2. The personal-fixed-income-funds for the lenders –\nregulatory compliant (no asset pooling) and offer stable interest rate and\nexposure to all yield curve to the investors (not just the exposure to the\nmoney market funds, but to the all yield curve). As the yield curve is upward\nsloping, then investors can lock in stable income for the future.<\/p>\n\n\n\n

                      3. Crypto-Credit-Score – this allows separation of the good\nborrowers and less good borrowers.<\/p>\n\n\n\n

                      4. And let’s add that as we are doing fixed-term-loans, then\nwe have less exposure to the flash-loan-attacks (because the assets are locked).<\/p>\n\n\n\n

                      Q9 from Telegram User @Pannicota<\/strong><\/p>\n\n\n\n

                      In the Lending\/Loans\nfields of DeFi, I most concerned about the SECURITY problems! Because I saw\nthat even in many BIG PROJECTS, Lending\/Loans fields always a \u201cGOOD MEAL\u201d for\nmany HACKERS, Like AKROPOLIS last month , 2 Mil has been STOLEN by HACKER, or\neven like Harvest Finance, 24 Mil from Lending has been HACKED because of the\nbug on the smart contracts! So how will you solve this problem?<\/em><\/p>\n\n\n\n

                      Tarmo: <\/strong>Current\nDeFi has two main security issues:<\/p>\n\n\n\n

                      1. Asset pooling<\/p>\n\n\n\n

                      2. Flash loans<\/p>\n\n\n\n

                      As a result hackers fee in 2020 has been 0.84% of total\nlocked value in DeFi. If you take that ETH lending fee is 0.6% then current\nDeFi has a BIG issue. It shows WRONG SECURITY DESIGN in DEFI.<\/p>\n\n\n\n

                      In SmartCredit.io we avoid both these issues. We dont do asset\npooling, we dont do Flash loans. Our approach is security by design.<\/p>\n\n\n\n

                      Q10 from Telegram User @tuvalunia<\/strong><\/p>\n\n\n\n

                      You provide the\n“Lowest Collateral Ratio” in the industry. How do you achieve this?\nWill you afford to keep it for a long time or is it for a temporary promotional\nperiod?<\/em><\/p>\n\n\n\n

                      Martin Ploom |\nSmartCredit.io: <\/strong>This is because of the business model:<\/p>\n\n\n\n

                      The money market funds do not know the loan maturity. The\nborrower can have 1 day or 100 day loans. That’s why they prefer high fixed\ncollateral ratios. The fixed-term-loans, however, know the loan maturity. And\nthis allows to reduce the collateral requirements (of course, you need to do\nsome maths for this).<\/p>\n\n\n\n

                      Additionally, we have the Loss Provision Fund, which would\naccumulate the unknown events. So, the key driver for the Lower Collateral\nRatio is the Business Model Design – not doing the money-market-fund business\nmodel, but doing the fixed-income-business model.<\/p>\n\n\n\n

                      Q11 from Telegram User @KeymerS<\/strong><\/p>\n\n\n\n

                      In all the time I have\nknown about DeFi I have learned that the most reliable and beneficial thing for\nsociety is that everything is developed under Blockchain, but it really is not\nso? With SmartCredit, can you get more benefits and have the same transparency\nas with the Blockchain? How is it possible?<\/em><\/p>\n\n\n\n

                      Tarmo:<\/strong>Customer has to come first. Business\nmodel second. Product architecture third. To offer added value to the customer\ncombination of onchain and offchain components is necessary.<\/p>\n\n\n\n

                      DeFi projects who call them blockchain only will always have\nsome offchain components. Key is to find right balance between onchain and\noffchain components and to put customer experience first!<\/p>\n\n\n\n

                      Q12 from Telegram User @phamtan310<\/strong><\/p>\n\n\n\n

                      With Smart Credit,\nInvestors can set up their Personal Fixed Income Funds to automatically invest\ninto the borrower’s loan requests. So is its profitability better than other\nYield-Farming models? Can users easily control their automated investments?<\/em><\/p>\n\n\n\n

                      Martin Ploom |\nSmartCredit.io: <\/strong>Let’s separate two business models:<\/p>\n\n\n\n

                      1. There is fixed-income-business model, which is low-risk\nbusiness model and which offers stable interest rates to the passive investors<\/p>\n\n\n\n

                      2. There is yield farming business model, which is not\nlow-risk business model, but more an “arbitrage business model” with\nhigh risk profile<\/p>\n\n\n\n

                      Of course, Yield Farming likes to present the returns. But\non the essence there are 3 sources of the returns:<\/p>\n\n\n\n

                      1. Borrower pays interest rate<\/li>
                      2. The liquidity pools (Uniswap, etc) give the\nservice fees<\/li>
                      3. There are reward tokens from several protocols<\/li><\/ol>\n\n\n\n

                        – We focus on the (1), it’s low risk<\/p>\n\n\n\n

                        – Yield Farming focuses on the combination of the (1), (2)\nand (3), it’s high risk<\/p>\n\n\n\n

                        Regarding automated investments in the fixed-income-funds –\nthe investments are done automatically. But the lender has of course the\npossibility to stop the fixed income fund and to retrieve the free funds (or\nadd new funds).<\/p>\n\n\n\n

                        Q13 from Telegram User @Cakelov<\/strong><\/p>\n\n\n\n

                        Hello Smart Credit, do\nyou have plan to create and launching a card like credit card or visa in the\nfuture?  So your client easier to use and\nlend from your platform.<\/em><\/p>\n\n\n\n

                        Tarmo: <\/strong>Yes, we have merchant capability\nalready in place. In merchant solution customer can get credit by purchasing\ngoods or services in the Internet like by usual VISA credit card. Difference is\nthat merchants dont have to pay high VISA transaction fees (ca 3.5 .. 5%) per\ntransaction. If merchants use smartcredit.io there margin will grow twice (VISA\nis very expensive for merchants).<\/p>\n\n\n\n

                        Q14 from Telegram User @Joseunda<\/strong><\/p>\n\n\n\n

                        The circulating supply\nof SMARTCREDIT is only 5% of the total supply, the remaining supply will be\nunblocked in what way or how will its distribution be?<\/em><\/p>\n\n\n\n

                        Martin Ploom |\nSmartCredit.io: <\/strong>At the moment we have 5% of tokens circulating and ca\n920000 tokens on the project account. The only way to get them into the\ncirculation is via the marketing activities and the rewards to the\nborrowers\/lenders\/integrators (which we will enable with the Release 1.2)<\/p>\n\n\n\n

                        In the years 2, 3, 4 and 5 we will unblock 22.5% tokens in\neach year.  The team tokens will be\nunblocked 1\/4 in the year 2, 3, 4 and 5. So, there are no team tokens in the\ncirculation at the moment. More details about the token model are in the: https:\/\/medium.com\/smartcredit-io\/smartcredit-token-model-1e2243c4c042<\/a>\n<\/p>\n\n\n\n

                        Q15 from Telegram User @phamtan310<\/strong><\/p>\n\n\n\n

                        Vietnam is a\ndeveloping country with a lot of SMEs, is SmartCredit a smart capital solution\ncompared to traditional banks? Do you have any plan to develop SmartCredit in\nVietnam?<\/em><\/p>\n\n\n\n

                        Tarmo: <\/strong>SmartCredit.io\nis a global solution. Customers from every country can use SmartCredit.io\nlending\/borrowing capabilities. Our intention is to bring together lenders and\nborrowers globally, so that companies from developing countries can borrow funds\nfrom lenders from not so fast growing countries (OECD countries).<\/p>\n\n\n\n

                        Q16 from Telegram User @Arabedans<\/strong><\/p>\n\n\n\n

                        What holds the non-fluctuation of interest rate? How does\nthe Low provision fund help protect the loan? How do you avoid hacks, bugs on\nyour application, do you allows developers once a while test your apps to avoid\nglitches?<\/p>\n\n\n\n

                        Martin Ploom |\nSmartCredit.io: <\/strong>The money-market-funds like Aave and Compound are using the\n“utilization ratio” parameter, which results then in the quite\nfluctuating interest rates. We are not using the “utilization parameter”,\nwe have the “yield curve”, which is the basis for the loans. Yield\ncurve defines the interest rate for a give loan maturity. That’s how we get the\ninterest rates – they are “yield curve” based.<\/p>\n\n\n\n

                        Regarding the hacks:<\/p>\n\n\n\n