BNPL Pay, a New Beginning…
1. Delayed Launch
I would like to begin by addressing the multi-month sized elephant in the room; The Delayed launch.
From the onset of BNPL Pay, we had very ambitious ideas about innovating in a space that is in of it self an innovation inside the Defi eco-system. Uncollateralized lending in a trustless and globally decentralized environment is a hard problem to solve. Numerous competitors have proposed and implemented various solutions, but every single one has neglected the most important element that BNPL Pay set out to address; decentralization.
The core design of BNPL Pay revolves around the idea of trustless Banking Nodes delegating pooled capital. This means that BNPL Pay as a company doesn’t individually vet, whitelist or restrict entity's from running a node. The rationale behind this is simple; if a central body gets to decide who can and can’t delegate pooled capital, then that isn't Decentralized Finance, its just Finance.
As it turns out, the architecture behind this principle is simple in theory, but far more difficult in practice. While we design mechanisms and reward systems to encourage good actors in our eco-system, we have to battle the very real possibility of selfish Node Operators who would look to abuse our ideologically neutral position on decentralization.
During our strenuous testing phase which has lasted months, we had run into numerous issues when it came to the architecture of the Smart Contracts that handle the execution of Banking Node logic. While trying to solve a problem of humans trying to game our system, we realized that the problem of Bad Actors doesn’t just end with bad logic, it starts with sub optimal code. To that end, we brought in additional talent and optimized all areas of the code base.
2. A New Beginning
The critical decision to rebuild and revise large parts of the codebase was perhaps the hardest but most rewarding decision that could have been made. We understand how frustrating it is for stake holders to wait and have their expectations broken, first with market conditions, secondly with missed delivery dates of the product. It is a difficult time for everyone in the space, especially with global tensions taking away some of the shine from the previously energetic bull markets that precipitated BNPL pays entry into the space.
We fully acknowledge that it is not the fault of market sentiment or global geo-politics that has contributed to the string of disappointments in our story thus far. It is also important to recognize that some of the strongest protocols including but not limited to AAVE (ethLend during the bear market), Compound finance and other pivotal projects that pioneered the DeFi space, emerged out of the depths of the worst crypto bear market (2018–2020).
Going forward, we commit to a New Beginning.
3. BNPL Pay from the ashes
As I eluded to earlier in the article, the team at BNPL Pay has been exceptionally busy brewing something special. A new code base, a plethora of new features, gas optimization, database overhaul, KYC overhaul, redesign, institutional users and more.
A reengineered Code Base
We have optimized the entire code base. Not only have we reduced the physical amount of contracts, but we have managed to fit no less than 5 entirely new critical functions on top of all of our previous offerings into a smaller footprint.
We have increase gas efficiency by upwards of 50% on most contract calls.
Removed all redundant code, all insecure math, and a large number of exploit vectors found in the previous code.
We hired a smart contract security expert to work on the new design as part of our team. Every function, every call, every piece of data is now designed from he ground up with principals of security in mind.
New Features
1. Interest only loans with balloon payments at the end. Borrowers now have the choice of having interest+principle or interest only repayments (with balloon at the end)
2. Partially or fully collateralized loans in addition to our standard offering of fully uncollateralized loans, to allow for a more diverse portfolio of loans (we are even looking at NFT collateral as an option in a later update). Loan collateral can be used to generate additional yield that market buys BNPL and distributes it to BNPL Stakers.
3. Loan referral program and fees, users can now refer a borrower and collect a portion of interest directly from every repayment the borrower makes.
4. Protocol revenue for the DAO. BNPL Stakers who will eventually form the DAO will now have a treasury that continuously generates revenue on the back of loans by way of origination fee (currently set at 0.25%, but can be adjusted by the DAO).
5. Stakers now earn double the interest that they did in the previous iteration. Stakers collect 20% instead of 10% of interest repayments in the form of BNPL. This adds double the buy pressure to the BNPL token on market.
6. Flexible and adjustable grace period for late payments. Banking nodes can now set the amount of grace time they wish to give borrowers so that a slashing event is less likely and less frequent. This gives Operators more time to reach out to borrowers who have missed payments. We allow up to 1 month of grace period that can be decided on a Banking Node level.
New Branding direction
As we work towards connecting our existing front end to our new reengineered back end, we are simultaneously working on a new brand direction. This will include a complete overhaul of the brand, a redesigned landing page, a redesigned webapp, and an overall elevated experience on every end.
Our goals for an overhaul in brand and design will take months, so the current launch plan will be using the existing front end with the new back end (and the timeline for this is shorter than the planned overhaul).
A sneak peak at some of the design and branding language ideas we are exploring for a new, more mature, more secure, industry defining BNPL Pay:
4. An influx of Corporate inquires, partner integration and more
BNPL Pay has always focused on the concept of bridging the galaxy of Traditional Finance with the world of Decentralized Finance. One of our key mandates has been outreach and education of users and institutions who sit squarely outside DeFi.
The number one hurdle of onboarding new users to Defi is complexity. There is a distinct lack of communication, education and onboarding material for the purpose of transitioning legacy finance on to Decentralized Finance.
There is a large amount of money sitting on the sidelines in the traditional world, unaware of the incredible yield opportunities and efficiencies DeFi affords (even in the current unfavorable market). There is an incredible amount of money in the DeFi world unaware of the hunger for capital that is obscured by the idealism of blockchain and dismissal of legacy finance.
Our opportunity is to introduce the parties to each other via the BNPL Pay platform and capture a segment of the finance pie that is largely ignored by the biggest players in the space. We built BNPL with this mission in mind, and we have dedicated countless hours to Business Development, introductions, education and materials to help our Legacy Finance friends match with our DeFi Friends in the world of lending.
Our efforts have yield a plethora of inquires, an influx of demand to borrow capital, a substantial corporate and defi interest in running banking nodes, and of course an ever enthusiastic crypto community who already feels at home in the incredible space.
As you are already aware we have our first confirmed large institutional player in MetaAsset Capital, as mentioned in the Feb update (link). MetaAsset plans to run an Institutional Grade Banking Node, targeting the South East asian market in the Traditional Finance Sector.
We have an established partnership with Alkemi Network (link), a DeFi centric institutional liquidity network. There have been a number of very serious clients from their side that have reached out asking to borrow capital on the platform.
Further to these efforts, our Business Development team has been reaching out to massive corporations in the Buy Now Pay Later sector in Singapore, Australia and other locales. The team is sourcing business from a very capital hungry sector in the BNPL industry, and it helps that our name, our team and our inspiration for the project was born from servicing just this sector. We have a number of very serious corporations looking to both borrow and lend from this sector.
5. Revised Timelines
Naturally everyone wants to know “wen launch?”. This is a question that is burned within the deepest recesses of our souls, ever since the disastrous delays of earlier in the year.
I want to tell the community that the light at the end of the tunnel is burning brighter by the day. We have completed the entirety of reengineered the back end code. The hardest job is done.
The brand new code will be submitted for audit to Peckshield. You may remember the team discussing the numerous audits by Hacken that occurred on the previous code. Unfortunately all prior audits are defunct, as the entirety of the code base has changed, and the reputation of the firm we have dealt with, has slipped dramatically enough that we are forced to look for a more serious alternatives. To that end, we have engaged Peckshield, and will be submitting the code for audit as early as next week.
The second part that leads us to the promised land, is the configuration of our existing front end (currently visible on https://app.bnplpay.io/) to the new code base we have built. This work is a little bit tricky for 2 reasons:
- It requires severing all the old values and links to the old contract and connecting them to the new one. This is a time intensive task, especially considering our team has grown and changed since the first iteration was released.
- It requires adding entirely new front end features (such as interest only loans, referrals etc) that don’t exist in our current front end. This work is a little harder then simply building a new front end, as it requires navigating all the delicate relationships between elements already present on screen.
Our conservative estimates for the grand launch (re-launch) of the new and improved BNPL Pay platform are for the middle of Q2, 2022. The focus of this milestone will be the deployment of the new code, paired with our existing, albeit upgraded front end.
Our next milestone is for the completion of the Brand and Design overhaul that is happening in parallel with the current workload. We expect a conservative estimate of end of Q2 to early Q3 to reveal and deploy our new webapp, landing page, branding package.
Thank you for those that have read this far, we appreciate your patience, your support and your trust as we endeavor to deliver a truly innovative product.
What is BNPL Pay
BNPL Pay is a decentralized blockchain lending protocol that is putting credit in the hands of those who need it the most: people without capital. The BNPL Pay Protocol addresses the issues that are presented by uncollateralized borrowing, with a decentralized network of banking nodes. With the BNPL Pay Protocol anyone can become a bank and anyone can apply for a loan.
BNPL is the governance token at the heart of the protocol.
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