What is WeTrust?
WeTrust is a lending, insurance and savings platform. The team behind WeTrust has built a platform that is decentralized, free of friction, is agnostic and autonomous. In the financial world, this is everything that users could ever wish for.
The conventional financial market is always rife for changes, innovation, and advancements. This is the only way to realize the utmost potential of these markets.
WeTrust brings an unprecedented level of innovation to the financial industry, and more importantly because it is hinged upon the benefits of blockchain technology. So what, really is WeTrust?
Like most successful blockchain projects that have been released so far, WeTrust is built on Ethereum.
It is, therefore, an alternative full-stack system whose premise is to make use of trust networks and social capital, while at the same time getting rid of third parties who often make transactions expensive. Because of this, WeTrust can offer users very low fees compared to the traditional financial institutions.
While low fees might seem a very good incentive, WeTrust offers a lot more than that. With WeTrust, users can look forward to decentralized risks on the part of lenders, better incentives compared to the traditional financial institutions.
More importantly, when using WeTrust most of the capital stays with the participants on the network, instead of financial institutions who eventually use the money to invest and grow, while the participants stagnate.
WeTrust is all about innovation. This project offers innovative products to address inherent challenges that have plagued the financial markets for so many years, all over the world. Therefore, what WeTrust has done is to create a system where there is global inclusivity, and this financial inclusion ultimately makes it one of the best platforms for lenders and borrowers alike.
What is the problem that WeTrust Solves?
The driving vision behind WeTrust is to ensure that the more than 2 billion adults in the world who are unbanked or underbanked can become a part of the financial system. There are a lot of roadblocks that make it difficult for such persons to own bank accounts, primarily the contradictions that exist in the conventional financial system.
It is virtually impossible to get a loan from a bank if you do not have a bank account, or a well-paying job, some good credit, insurance claims and so forth. Most people have to resort to using shylocks and other options that are not very friendly.
As a result of the misalignment of interests and the hindrances that exist in the ability to access financial services, the unbanked, underbanked and uninsured usually end up suffering.
Based on these challenges, WeTrust strives to leverage trust networks, social capital and blockchain technology to come up with a financial system that is carefully aligned in such that it meets the needs of everyone, especially the more than 2 billion adults who currently do not have access to the services they require.
It is important to note that WeTrust is not here to replace the traditional financial systems but to make them better. These institutions play a very important role in society, and it would be preposterous to wish them away.
More importantly, WeTrust wants to get rid of the third parties, thereby improving the efficiency in the operation of these institutions, especially by getting rid of their dependence on centralized networks and platforms.
How does WeTrust Solve the problem?
To solve these problems, WeTrust has developed a system upon trust networks, social capital and blockchain technology. This system works through trusted direct lending, mutual insurance, trusted lending circles, and community-based credit history building.
Trusted Lending Circles
This is a platform that is specifically designed for rotating savings and credit associations (ROSCA). In this platform, smart contracts are used to automate the process of lending and saving. This process includes bidding, contributions and assigning funds to users on each round, and withdrawal of funds.
To make this easily accessible WeTrust has designed a web application that every member can use to effectively manage their participation in whichever lending circle they belong to. Users can belong to more than one trusted lending circle.
In these circles, there are micro-networks. These are aimed at offering incentives to members so that they can invite other people that they trust. This eventually increases the social incentives and the net value of the lending circle. Different groups can also create unique metrics that they use to operate, depending on their circumstances and specific needs.
Sovereign Credit Identities
This is another product that is built into WeTrust. The credit identities are built based on the quality of the social media accounts that are tethered, and the terms of the lending circle. Individuals who are responsible should have a very easy chance of creating and maintaining a very high credit identity.
This eventually improves their creditworthiness in the network and makes it easier for them to use other high-stake features like the power to vouch for a member or establish trust with other persons in other circles out of their network.
Such credit identities can also be shared upon request, with the traditional financial institutions like banks. They help prove the credit history. It is important to note that identity plays a significant role in the lending circles.
This is because they eventually help the circles scale up over time, and evolve into micro-saving groups. Essentially, this will improve the demand/supply matching, and improve the interest rates available in the marketplace.
Lending and Borrowing
WeTrust also has a lending and borrowing platform that is powered by the trust network. In this platform, borrowers are connected to savers, which makes it easier for them to access financial supports directly, and at a very low cost.
What makes this product different from the normal lending facilities in the financial markets? This facility leverages the credit identities that had been created earlier on.
Other than that, it also relies on legal contracts, loan guarantees, trust inferences and loan deterrents. Members who are trusted in the network can vouch for someone to get a loan.
When they do this, they will earn some fees for putting their reputation on the line for the member, and taking up the risk of partial responsibility for the loan that the borrower took.
Mutual Insurance
The mutual insurance product makes use of smart contracts. Smart contracts are an inherent feature in Ethereum. These contracts are essentially code that is written with instructions to perform a specific action when executed. In this case, they evaluate whether the member has met a set of criteria, then allow them access to payouts accordingly.
In line with the need for true transparency within the blockchain, all the criteria that should be met are set out in public, so there is no secrecy in the nature of the contracts. There is a very small fee involved in these contracts.
What makes WeTrust better than the competitors?
Automation and Efficiency
WeTrust uses smart contracts. Through these, it is possible to automate payments from end to end. Smart contracts also help in efficient estimation of risk models and decentralizing the processing of claims. In the long run, this has helped to reduce the cost of operation.
By using smart contracts, WeTrust introduces autonomous business logic. This is important in running a secure, fast and reliable business product. It is also through this that WeTrust is able to get rid of middlemen like financial institutions who have no feasible role to play in the transactions, but only exist to earn commissions, which when passed down to the user, makes the entire process very expensive.
Easy access for the underserved
The concept behind WeTrust has made it possible for those who are underbanked, underinsured or uninsured and unbanked to have access to financial services that they had been locked out of for a very long time. Those in developing countries or people who are low-income earners are now able to access financial services.
Digital Identity
Because of the digital identities that are created on WeTrust, users can enjoy services all over the world on the blockchain. They are also able to take advantage of opportunities that come their way, without worrying about governance challenges.
Transparency
One of the key features of a blockchain platform must be transparency. WeTrust handles transparency as a feature on a platform level. Any and all data that is relevant to the WeTrust ecosystem can be audited and analyzed by relevant parties, while at the same time, maintaining utmost privacy.
Experimenting
WeTrust is an open-source project. Therefore, there are so many benefits that users stand to enjoy from using this project. Usage is permission-less, there are myriads of options for customization, accounting is very easy and so forth. Individuals and groups are able to use a simple app to engage with one another or their communities, and in the long run, look forward to some serious tangible financial results.
How can WeTrust be categorized?
WeTrust is a collaborative lending, savings, insurance platform that is built on Ethereum to provide an efficient alternative financial system. It uses trust networks and social capital as leverage, and to get rid of third parties from financial transactions.
What’s WeTrust’s vision on Security?
In the WeTrust ecosystem, what is at stake is the money that users have worked so hard to earn. Since the majority of the target market is people who are unbanked or underbanked, this money means a lot. For this reason, security is a high priority concern at WeTrust.
To make sure that the funds in the network are safe and they are used the way they should be, there is a sizeable investment in security audits. Apart from that, the results of these audits are often made public, and the progress thereon.
WeTrust also built a dedicated server specifically for monitoring transactions on the WeTrust network, albeit anonymously. This server is tasked with identifying and addressing any suspicious behavior or fraudulent activity on the network.
Sybil attacks are common in the blockchain realm. These are attacks where an individual is able to create fake profiles, and from these, they eventually generate legitimate credit scores. WeTrust takes identity verification seriously, so it is virtually impossible to execute a Sybil attack.
Examples of WeTrust use cases/applications
The following are some of the use cases wherein WeTrust has been integrated into the financial markets.
App Token
WeTrust created the Trustcoin (TRST). This is the currency through which all services conducted in the WeTrust ecosystem can be performed. It is used to reward actors who facilitate trust or those who are paid in the trust network. The amount of TRST that can be used for every transaction is determined by the market forces of demand and supply.
In the WeTrust ecosystem, the TRST can also be used as collateral in a situation where the parties or one of the parties involved does not have a notable or credible reputation. For the foreperson to receive full fees in the trusted lending circle, there must not be any delinquencies. In case any of the participants becomes a delinquent in the network, the foreperson will be penalized.
This is done by reducing the fees that they receive in the transaction.
To make sure that the participants can feel and stay confident in the ability of the foreperson to build a network of trusted associates, the foreperson has to deposit TRST as collateral. In the unlikely event of delinquencies, this is distributed to the participants who have a good standing.
Allocation of Trustcoins
Research – The coins can also be set aside for research in game theory, actuarial, statistical models, mathematics, computational simulations and so forth.
Software Development – The coins can also be used to budget for development of smart contracts, software development, creating a seamless user experience and security reviews.
Business Development – This is to cater for expenditure involved in growing the trusted lending circle communities, partnering with NGOs, and hiring managers who will help in spreading the word about WeTrust.
Marketing Costs – This is to support all expenditure that should be used for enlightening the public about the WeTrust platform, sponsoring conferences, blockchain events, hackathons and so forth.
External Costs – This is expenditure for things like security audits, regulatory compliance, bounties for bug hunters and anything else that concerns technology and development.
Resources
https://coincheckup.com/coins/WeTrust
https://www.wetrust.io/#blog https://github.com/WeTrustPlatform/documents/blob/master/WeTrustWhitePaper.pdf