Three Ideas for Consumer Crypto
Idea #1: Alternative Financing for SMEs
Intro:
Develop alternative financing options that use smart contracts and stablecoins to facilitate low-cost and secure transactions for small to medium sized entities.
Why should someone build this?
- SMEs account for 90% of businesses in Africa, contributing over 50% of employment; and 45% of India’s industrial output and employing 40% of the country’s workforce
- SMEs lack the collateral or credit history that banks require for loans.
- Since most of the companies require working capital to finance operations, they can unlock finance through Invoice financing, supply chain financing and factoring
- Reliable statistics on these solutions are not readily available for Africa although it can be proven that SMEs are contributing tangible progress for economies.
- The idea presents an opportunity to build a marketplace for financiers and SMEs who use smart contracts to verify the authenticity of invoices and the settling of the amounts at given dates
- The project may see the need for zk-SNARKs to verify the existence of transactions, relationships and balances with other players such as banks, trade promotion and government entities.
- This will help to leapfrog SMEs towards maintaining proper financial information and records used to create credit worthiness information used by banks and related financial institutions in loan assessments.
- Apart from improving the financial efficiency of SMEs, the protocol stands to earn interest and related financial charges on the service.
- Additionally, more business products may be developed onto the platform such as banking, decentralized ERPs, CRMs, accounting and tax software with related web2 bridges, connectors and adaptors to enable cross communication.
- Lending market in India is expected to grow at a compound annual growth rate (CAGR) of 11.6% from 2021 to 2026, reaching US$ 2.8 trillion by 2026. There were 12.2 million MSMEs registered by November 2022
- Loan disbursals to MSMEs stood at US$ 128.06 billion, a 40% increase compared to FY20; indicating a huge
Resource:
- https://www.afdb.org/en/documents/african-economic-outlook-2021-supplement-fostering-entrepreneurship-and-innovation-for-africa-s-economic-transformation
- https://www.ifc.org/wps/wcm/connect/industry_ext_content/ifc_external_corporate_site/industries/financial+institutions/resources/smes-in-india
- Annual Report 2021–22 | Ministry of Micro, Small & Medium Enterprises (msme.gov.in)
- MSME Industry in India — Market Share, Reports, Growth & Scope | IBEF
Idea #2: Phone Number Service
Intro:
Create a protocol designed to connect a phone number to multiple wallet addresses
Why should someone build this?
- Address a wider market in Africa and Asia with limited access to the internet by accessing the blockchain using USSD and SMS technologies
- Abstraction of the technical aspects of blockchain for easier adoption and mainstream usage of the technology for daily usage
- Enable regional trade and exchange as individuals will use the unique cell numbers of individuals to send funds
- Ability to embed functionality such as escrow and staging transactions before execution to safeguard consumer funds.
- USSD based payments reaching over 52,4 million users by March 2022 operating in seven countries in seven sub-Saharan countries by m-Pesa
- Service may be used to enable cross border payments, remittances and open access to banking (revenue expected to have breached USD 129 billion by 2022 although 57% of the population remains unbanked), credit services and insurance (about USD 68 bn; with steady growth since 2020) based on smart contracts.
- UsePNS is an iteration on the same idea, still in beta mode and focussed on the Ethereum blockchain.
- On-ramping and off-ramping can be achieved using existing infrastructure such as mobile money; with consultation with local service providers
Resource:
- https://usepns.xyz
- M-Pesa’s fintech app now hosts transactions worth more than half of Kenya’s GDP | Fortune
- How insurance in Africa can find success | McKinsey
- Insurance industry in Africa — statistics & facts | Statista
- Banking revenue in Africa 2022 | Statista
- 460 Million Unbanked in Africa — The World’s Opportunity — Yabx
- Who’s Who in Fintech: The Middle East and Africa 2021 Report | The Fintech Time
Idea #3: Privacy in Verification
Intro:
Efficient and secure constructions for zk-proofs to enable blockchain scalability and privacy preservation.
Why should someone build this?
- Web2 solutions are still relevant and used as core systems for a number of entities. They remain the most acceptable and relatable solution to verify and authenticate real world scenarios
- In order to start using smart contracts to improve the ease of doing business and automate standard business systems, it is important to provide web2 based proofs for various information sources
- An application can be developed to generate zk proofs in a private container and store / associate such proofs with an account / wallet
- Proofs can be generated on government IDs, passports, bank accounts and balances.
- The application can be used as a zk KYC/AML passbook that can be applied / associated with a wallet to verify a user’s details. This will enhance the security of smart contracts as parties can be verified without necessarily exposing the counterparty’s detail although providing proof of the existence.
- The app has both personal and business application as more enterprise usage of smart contracts is steadily increasing and businesses are becoming more aware of business
- Global blockchain market is expected to grow from $3 billion in 2020 to $39.7 billion by 2025 on the back of government initiatives, convergence of blockchain with AI/ML and IoT
- This solution brings a layer of security and privacy as it can create more transparent trusted setup ceremonies and better threshold signatures for multi-party computation.
Resource:
