Inside the Masa Web3 Credit Score SBT

Published in
6 min readFeb 13


At Masa, we are committed to building the premiere soulbound token protocol, and are striving to bring 1-billion people to the world of web3. To fulfill this mission, it’s critical we solve real-world problems with soulbound tokens.

One of the first soulbound tokens we launched is Masa Credit Score Soulbound Tokens (MCS SBTs). The first release of the Masa Credit Score SBTs is a Web3 Credit Score SBT in partnership with Cred Protocol, whose web3 credit scoring technology focuses on users’ on-chain creditworthiness. We took the web3 credit score technology built by Cred Protocol, and soulbound tokenized it within our protocol to make it available for web3 users and lenders.

Today, users can mint their Masa Credit Score Soulbound Token. Soon, users will be able to apply for a DeFi loan via a soulbound lending pool powered by a Masa Partner, such as Teller.

In this blog, we’ll explore how Cred Protocol’s on-chain credit scoring technology works, the new era of Masa Credit Score SBTs, and the power they have to disrupt traditional, centralized credit infrastructure by providing individuals, businesses, and developers with the tools to access credit on-chain.

How can I get my web3 credit score and mint my credit score SBT?

Go to our Masa mainnet dashboard: Go through the process of authenticating your Metamask wallet, which will create your Masa Identity SBT. Once complete, you’ll be instructed to choose and mint your Masa Soul Name. Learn more about minting your Masa Soul Name here.

Once complete, you’ll be directed to the Masa SBT dashboard, where you will see the card on the bottom left which says “Credit Score.” Click on “DeFi credit score,” complete the transaction to mint your web3 credit score, and you’ll see your score pop up in the dashboard.

How is my web3 credit score calculated?

Powered by Cred Protocol’s technology, your web3 credit score is evaluated by assessing your assets and activity across chains and protocols. The current web3 credit score mostly will assess your activities on Ethereum and Polygon blockchains, including the value and quality of the tokens and NFTs held in your wallet.

The web3 credit score also takes into account any borrowing activities you’ve performed on the Aave, Compound, and Teller protocols (with more protocols in the works). This will include loans you’ve taken, repaid, and whether there were liquidations or defaults. Cred Protocol and Masa are quickly expanding our coverage to other protocols and chains, including Celo.

Six types of credit factors are considered in the calculation of a web3 credit score:

Find out more about how your web3 credit score is calculated here:

How does Cred Protocol score new wallets?

At a minimum, 10 to 20 transactions are required for a wallet to be considered “scorable.” Meaning, for the wallet to generate a score, it requires enough transaction history to be evaluated. Credit scores are also evaluated by scoring a wallet against other wallets and placed on a spectrum of creditworthiness. Remember, a credit score is a relative concept, rather than absolute. Where you sit on the percentile of credit worthiness within the system determines your credit score.

How does the duration of credit history impact your web3 credit score?

An account’s previous borrowing and repayment behavior plays a key role in determining an account’s web3 credit score. Cred Protocol is generally correlating the account holder’s ability to fulfill obligations and seeks to predict probability of adverse borrowing events over a 90-day period. This is calculated across a variety of lending protocols, and takes into consideration not only successful repayments and historical liquidations, but also where relevant, other examples of “adverse events” including previous examples of delinquency and default.

Experiencing an adverse event has consequences in your score, but is not terminal to an account’s web3 credit score. Users should be able to redeem themselves based on a subsequent track record of healthy financial behavior.

Your most recent transaction behaviors are the most significant to your score, weighted against actions in the past. Scores are produced in real time as we look at transaction activity up to the latest validated block.

What does a high or a low credit score mean?

Your credit score is intended to be predictive of the borrowers willingness and ability to repay their loans. The web3 credit score is informed by, and incorporates “probability of default,” but it is not a direct probability. Rather it reflects the distribution of “probability of default” across the population of accounts. An “Excellent” web3 credit score means a lower probability of loan default relative to others, whereas a “Low” web3 credit score implies a higher probability of loan default relative to others. DeFi Lending protocols can use the web3 credit score in predicting loan performance, determining risk, loan value and underwriting borrowers. The score enables more capital efficient lending, such as reducing collateral requirements or lower interest rates — expanding access to borrowers who might not otherwise qualify for loans.

How can I build and grow my web3 credit score?

Referencing the above information, there are a variety of ways to build your credit score. One of the best ways to start building your credit score is to accumulate assets and/or generate borrowing history in web3. The more transaction history you create, the more opportunity to demonstrate healthy financial behavior — , building credit reputation for your wallet

Taking loans on Aave, Compound and Teller and other lending protocols, followed by timely repayment, regardless of the loan size, is the best way to boost your credit score.

A New Era of DeFi Lending and Access to Credit

The family of Masa Credit Score SBTs will continue to evolve and grow. The first release of the Masa Credit Score SBTs focuses on on-chain creditworthiness, in partnership with Cred Protocol. We will soon introduce a few new types of Credit Score SBTs to the family, such as Emerging Market Credit Score SBT, to assess off-chain creditworthiness in emerging markets such as Kenya and Nigeria.

  • Web3 Credit Score SBT focuses on the web3-native community and is a representation of your on-chain creditworthiness; Masa launched web credit score SBT in partnership with Cred Protocol, and is currently available.
  • Emerging Market Credit Score SBT is focused on the billion-plus “credit invisible” people across emerging markets, whose credit worthiness is not accurately captured by traditional credit bureaus. Powered by partner, we consider alternative data such as mobile money, mobile loan, and other android mobile data in coming up with an emerging market credit score, and soulbound tokenize the score into a Masa Emerging Market Credit Score SBT, as part of the on-chain representation of your creditworthiness in emerging economies, starting with Kenya and Nigeria

Collectively, these Masa Credit Score SBTs put together a holistic picture of a user’s creditworthiness on-chain and off-chain at a global scale. Only 1.5 billion people worldwide have credit scores, and 3.3 billion people are “credit invisible,”: meaning they are creditworthy, but their credit history is not associated with them in the traditional banking systems.

For the first time, Masa Credit Score SBT will combine on-chain, off-chain, and emerging market financial identity information, and give the 3.3 billion credit-invisible people access to a global liquidity pool.

While nascent, there is a cohort of projects building in the emerging on-chain lending space: for example, Goldfinch and Credix are bringing liquidity providers on-chain, and Teller is setting up the marketplace that bridges liquidity providers and borrowers. Masa is playing the key role of empowering borrowers and lenders with financial identity information to make underwriting decisions in on-chain lending.

In conclusion

Together, Masa and Cred Protocol believe that real-world utility lays the foundation for the next phase of web3. The on-chain lending, as demonstrated in our partnership, is a prime example of web3 delivering real-world utility.

In the coming weeks, Masa will launch the first soulbound lending pool, which allows Masa Credit Score SBT holders to apply for a DeFi loan: Sign up for the waitlist here. People will be watching closely at our first attempts — and when we deliver, the wider ecosystem will have more confidence to adopt this innovative model.

Utilizing web3 credit and soulbound tokens, we’re taking DeFi mainstream and across the globe.

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