Quote from: AusKipper on February 28, 2017, 10:55:50 PM

Quote from: modernbuddha on February 28, 2017, 07:20:38 AM

Quote from: AusKipper on February 28, 2017, 05:24:18 AM

A blockchain can be used to create a cryptocurrency to act as a medium of exchange.

A blockchain or cryptocurrency, IMHO, cannot vette people for loans, and then prosecute them if they are fraudulent in their loan application and/or don't pay the loan back.

I think any of these coins based on that concept is doomed to fail (WeTrust, HumanIQ)

If you want to do something like this, use an existing coin as the currency, and then create the software etc to facilitate the peer to peer loans (ie, create a Kickstarter using Bitcoin or Monero or Dash or some other coin, and let that software run in a de-centralized fashion)

@AusKipper: We aren't policing the loans. We're creating tools for people to police themselves and organize as they choose. To thwart bad actors, WeTrust will have four deterrents:

1. Reputation risk/ Reviews: ROSCA groups will be limited to "trusted associates" - family, friends, co-workers, fraternal groups, and professional/ religious organizations. Defaulting on payments could mean social shame and loss of reputation amongst an individual's closest associates. The idea is that for ROSCAs with small enough dollar amount commitments, reputation risk will be sufficient enough to keep participants honest. Reviews may also be left by other members to show how they felt about any participant.

2. Legal risk: ROSCA formation will allow trusted associates to e-sign and bind each other to a legal contract which requires faithful adherence and payment to the ROSCA. Defaulting on payments and stealing could mean legal repercussions. Legal recourse will only be used if individuals are participating in a "high-stakes" ROSCA and legal action would be worthwhile. I've spoken to our legal advisor and she believes it will be possible to create auto-populating templates that will be tailored to each person's ROSCA terms.

3. Collateral risk: Collateral commitments may be required prior to joining a ROSCA. The collateral will be entered into a smart contract which will surrender the property to the ROSCA group if the ROSCA agreement is breached. Collateral can be liquid-cash like assets like Bitcoin or even less liquid assets such as auto/ home titles. Our system will benefit significantly from the ability to accept less liquid assets, since the majority of middle classes net worth is locked in real estate. Collateral would allow capital to be used more efficiently.

4. Smart contract bounty (self-enforcement): If a ROSCA participant violates the terms of the ROSCA, the ROSCA group may start a Bounty on the retrieval of funds. If the funds are retrieved, the Bounty is paid out to the person who enforces the terms of the ROSCA.

These deterrent options will be on an "opt-in" basis and participants will be able to choose the level of security they want.

I think due to the ease of creating not just fake identities, but multiple fake identities, and inputting them into this type of system makes points 1-3 more or less ineffective.

4 (the bounty) I think is a good idea and could have some effect, though how effective people will be tracking down fake identities without the support of a police database and the ability to legally conduct raids on private property etc I am not sure. I think 4 is likely to be ineffective.

I still think you should be using an existing coin and not creating your own.

I think WeTrust will fail, but, I dont want this to make you feel disappointed or anything, use my negativity to give you the energy required to go out and prove me wrong, because, I would love to be proven wrong. I like the idea of having a de-centralized bank but I just dont think it will work, ESPECIALLY when your creating a new token instead of using an existing one.

Time will tell.

*edit*

OR, before your ICO you could cancel it, listen to me (fat chance right? lol), change your plan to develop the software but use as existing coin (ie, you could work with Dash or someone), then launch the ICO again. Then you would not only get the support of people that would have supported you for this, but also the supporters of Dash (or whatever coin you chose) because they know your software, if it works, will increase the value of the token they already hold.

Even then I still think it will fail but you will have a snowballs chance in hell at least.

Thanks for your thoughts! One can multiple fake identities but it may not be easy to convince your friends to join this group that has some unknown identities. It comes down to how you would be able to convince other people (friends, trusted associates) to participate with you in this ROSCA circle. That would be difficult, because they would be able to see the email account, want to know their names, meet them etc...

At this time, you can invite others, and get invited to a Trusted Lending Circle, so you won't have the opportunity to interact with someone you do not know. The concept of a lending circle (aka rosca) is very different from lending club where you interact with strangers. In a Trusted Lending Circle, you verify that you know these participants before joining. Is that helpful? thanks!

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