Utilizing Cryptocurrency For Fiat Lending By Debitum Network

Before the emergence of banks, loans and reparations were settled peer-to-peer. People were required to trust each other, but over time, the importance of trust began to break down. Thus, intermediaries and third parties were needed for the arrangements and processes. These middlemen render a layer of protection, but it charges higher fees while extending extra layers of complexity and control to the means of lending and borrowing.

Then enter the blockchain technology. Created on a distributed ledger, the very quality of its design is trustless and decentralized. It makes it conceivable to transfer ownership of an asset from one person to another, without the necessity for a mediator, an attribute which could help improve peer-to-peer lending practices and even drive it to new heights of reputation.

The advantages, especially for individuals and small-to-medium-enterprises (SMEs) are notable, as availability to credit can often be hard, with many hoops to jump through. The rapid increase of crowdfunding and ICOs, for example, exhibits a willingness to adopt alternatives for raising money.

Debitum Network As The Crypto Alternative Finance Platform

Debitum as an existing business in alternative finance aims to be a fiat/crypto lending platform since its’ commencement. They want to embrace both fiat investors and crypto community on their platform and implement the possibility for everyone to engage in the process of providing funds for small businesses around the world by financing short-term loans on Debitum’s global platform. The first version of platform Debitum Network 1.0 Abra ran live on the 3rd of September and fiat investors have been authorized to finance short-term loans and earn interest on them right away.

Its lending platform significantly models on the timeless peer-to-peer basis, making the whole process more seamless and decreasing the amount of time the process demands. The middleman like banks are cast out, and individual borrowers or businesses are equated directly to active lenders. The high value of such decentralized finance platform of Debitum is that with a single application, a borrower can access very competitive financing, as geography is no restriction on a blockchain platform, lenders globally can request to provide the loan.

They want to provide the same opportunity for cryptocurrency hodlers as well by registering and depositing DEB tokens or Ethereum on their platform. It will be applied as collateral to get Euros on users’ account and provide the opportunity to invest with fiat balance in short-term loans.

How does the process operate?

  • Users register on Debitum platform and deposit DEB tokens or Ethereum.
  • Users crypto is taken as collateral and frozen to get Euros to their balance.
  • Users balance is updated in Euros.
  • Users invest in short-term loans of your choice, and their balance amount is sent to small businesses.
  • When the loans mature business return full amount + interest via Debitum Network ecosystem.
  • Users continue investing. Rinse and repeat.
  • Users decide to withdraw. Interest is transferred to their balance in fiat.
  • Users crypto collateral is unfrozen and sent back to their wallet.

What benefits Crypto investors are able to enjoy?

  • Use crypto to invest in SME loans and support businesses.
  • Benefit from increased crypto price during the loan period when their crypto is frozen.
  • Earn interest in fiat on crypto assets.
  • Always have an extra edge over crypto asset by making regular 10-15% on short-term loans.
  • Hold crypto assets and earn EUR as interest, which they can withdraw and spend whichever way they like.

What unique business possibilities does that propose?

  • Debitum enables crypto investors especially crypto holders to invest and serve local fiat-based SMEs today.
  • Debitum open a new investor market for local SME – crypto individuals who would otherwise, not invest in fiat into their businesses.

Conclusion

While Debitum doesn’t decrease credit risk, it could nevertheless dramatically lessen operational risks, advancing the efficiency of financing and lending models through more decentralized, trusted, immutable accounts with favorable pricing and confidence in the underlying assets utilizing cryptocurrency for fiat lending. There will be more and more contributions for Debitum based credit coming out over the next years, and it would be fascinating to see how they evolve and what kind of consideration they draw from banks and regulators, particularly if more SMEs and individuals start to choose Debitum Network’s platforms more extensively.

 

Traxia And Debitum Network: What’s the best finance alternative system focusing SMEs?

Small and medium-sized enterprises (SME’s) are often considered as the backbone of any economy. When globalization becomes more prevalent, and progressions in technologies level out the playing field, economies of scale become less of a factor. The potential for SME’s to compete and participate considerably in the global marketplace becomes even bigger. eCommerce, in particular, has provided SME’s the opportunity of an international recognition that was once only the forte of big companies.

However, the problem with the small businesses is, even when they manage innovation and competition in most economic sectors, owners have difficulty obtaining the right way to accommodate their expenses away. Banks simply don’t want to get associated with a business unless that business is large or is expected to grow in the next fiscal year. SME loans are basically nonexistent.

The Era Of Blockchain Technology

The development in financial technology solutions over the last few years has given means to a whole sector of alternative lending opportunities for SME’s that don’t just make it simpler to get access to funding but, in many cases, the financing is also significantly cheaper than traditional ways.

One such area is Blockchain, and the increasing value of use cases the technology is being applied to. Blockchain technologies will soon disrupt the system smaller businesses do loans and finance. These new technology promise to once and for all end the institutional weaknesses of the policies the banks have incited over the small or medium-sized enterprises, who never seem to receive a big slice of the pie.

The obstacles that SMEs are challenging are local, as most small businesses start out small, the answers that the blockchain offers are global and at a much larger order than the business owners can even begin to believe. It is where solutions such as Traxia and Debitum Network come in handy. Both are blockchain powered decentralized networks that aim to disrupt the financial crisis among SME’s.

Traxia Versus Debitum Network: What’s the best solution?

The two finance alternatives are remarkably emerging as fine solutions to the ongoing problem of small businesses. However, one would be confused about the differences that each has; the features, services, technology, and level of difficulty to acquire a loan.

Let’s understand the concept and processes that these decentralized projects could offer to SME’s and individuals.

Traxia: A decentralized trade finance ecosystem

The vision of Traxia is to build an open and decentralized ecosystem to develop trade finance worldwide. Traxia combines blockchain and an open, connected IT architecture to design a new ecosystem for trade finance. It enables corporates to create smart contracts — automated, self-executing digital contracts that trigger payments and receipts in real time as goods move within the supply chain.

Tracking of goods through the modern Internet of Things (IoT) solutions can moreover eliminate doubts about where physical goods are; blockchain assists to verify identity and ownership and could conceivably simplify agreement and governance, as well as decreasing manual work and human error. The transparency gain from such advancements ultimately leads to better access to finance in several ways:

1. Trust and Transparency
2. Securitization and Standardization
3. Access to capital markets by decentralization

The platform increase finance availability for small and medium-sized enterprises (SMEs) by modifying invoices into smart contracts and tokenized assets which can be exchanged while the business’s accounts receivable is utilized as collateral.

An MVP has improved and is apparently at an early stage of advancement. However, it is asserted that the system is “is fully integrated to cynopsis (KYC/AML), creditsafe (company scoring), lakala (payment service provider).” The web-interface is operative, but integration with the Ethereum blockchain is uncertain. Users are capable to view the status of payments and brief information regarding partners and projects.

The application of the platform is visible. Giving SMEs access to short-term funds liquidity would support with the business operations of all participating organizations. Additionally, the case that buyers and sellers still negotiate using fiat currency provides for the platform to be more immediately adopted compared to other blockchain-related projects.

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Debitum Network: A Decentralized Financial Solution To SMEs

The Debitum Network vision to take the control away from centralized banking institutions and the over-regulated, inaccessible quality of credit from the existing banking platforms. Small enterprises presently strive under the regime of centralized banks, and to oppose this, Debitum will connect borrowers, insurers, lenders, risk assessors, and document validators on their platform.

The platform users will be able to connect for free and promote cross-border transactions that are free from the unnecessary costs and suffocating policies associated with traditional lending. Developed as a hybrid platform, Debitum will work on the Ethereum blockchain and processed arrangements via smart contracts and utilizes an internal system of payment.

DEB as Debitum’s official utility token is used as the mechanism for borrowers or investors to enter the services on the platform such as risk assessments, obtaining insurance, and even loan collection. A trust rating system is also merged within the platform which is significant for all financing process.

Debitum also has a hybrid system that facilitates the smooth integration of fiat-crypto infrastructures which ensures that as the adoption of cryptocurrencies progress, Debitum Network will be able of adapting and extending its services in both fiat and cryptocurrencies seamlessly.

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Conclusion

Based on the summary provided above as introductions, Traxia and Debitum are two useful projects that certainly are significant solutions to the ongoing financial dilemma that small and medium enterprises are suffering. Both missions and visions are promising that ascertained to disrupt the current centralized system of the lending sector.

Traxia runs on the Cardano system while Debitum on Ethereum blockchain. Both platforms are not arguable regarding reliability and security. Depicting based on each website, Debitum has more attraction in terms of design and usability, while Traxia maintains a simple layout without much functionalities to explore. 

Traxia has minimal exposure compared to Debitum that continuously updates its community members by updated blogs, social media posts, and participation on numerous fintech blockchain events that even more make their name a golden chime to the advancement of the financial industry, giving all types of enterprises a chance for funds and capital.

The Importance Of Transparency As Explained By Debitum Network

Transparency in business challenges entrepreneurs to remain open and communicative about critical points of information, including their business’s objectives, history, production, and services. Moreover, it’s a goal that grows in value and influences industrial innovations including the blockchain technology.

One of the most appealing perspectives of blockchain is the degree of transparency that it can provide. Although it is often attributed to as a “trustless” technology, the central element that holds the ecosystem together is transparency and reliability. However, several negative publicity has been given to blockchain companies and ICOs in the mass media lately. The issue of transparency of the newly organized companies, exchanges, and management has been questioned again and again.

A recent study explains that about 1000 ICOs are discontinued, and that half of them experienced bankruptcy, four months after token sales. It is considerably common in an unregulated setting as clever financial criminals abuse this new way of an opportunity to collect funds for starting a business and not doing anything to accomplish the promises that they have presented.

Lack Of Transparency Among Major Banks

Transparency is something that huge mainstream companies, especially banks and likewise mass media fail to address. Transparency, or lack of it, may be the reason for major economic crises around the world and bankruptcies of well-established businesses. It is so easy to shift blame on the new and ignore that the old is opaque and careless in its business practices. Nothing can explain it better than 2008 crisis when major financial enterprises operated by short-term profits produced excessive and fraudulent transactions in derivatives, created toxic financial tools and marketed them to the public with a benefit from rating agencies that provided those products triple A’s as if they were stable and reliable securities one could invest.

Blockchain Technology Does The Regulatory Work Better

With several other advantageous aspects that blockchain based companies possess, transparency is at the core of it. It may be observed, not only in finance activities but if financial company deals over a blockchain platform, everybody sees all their holdings and all the transactions that they have processed. None of the prominent financial giants or hegemons have had this same transparency before. It is about to improve, and new blockchain driven companies will accomplish far more accountability to the entire system.  No transaction will be hidden, and thus company using the technology will show real integrity towards their customers and the community.

Debitum Network A Transparent Fintech Company

debitumDebitum is a young and ambitious alternative finance company that is founded on the principles of decentralization, accessibility, and credibility. It is an exceptional example of a transparent blockchain driven company that responsibly utilized collected funds from ICO and has just presented a promised product of an alternative lending platform.

The company has been developed from two respected and accomplished companies: the alternative finance corporation Debifo and a high-tech firm Inntec. Debifo has had a turnover of 50 million Euros in factoring lending just in three years, and Inntec has been one of the fastest developing IT company in Northern Europe. Both co-founders and advisers for Debitum Network have an extensive background in finance and IT.

Maintaining Credibility

Debitum continuously endeavors to provide strong and transparent service. They aim to motivate their community members to be more confident and guaranteed that they will fulfill what they have promised of being the best alternative finance platform. Aside from that, they also aspire to become a significant example of a blockchain powered project that values honesty and integrity.

As the blockchain technology advances, scammy programs, risk, and mistrust will also subsist. Debitum makes their project stand out and assist the blockchain space in developing by building the trust of their community, partners, and users.

Here are three key points that Debitum practiced to sustain transparency:

  1. Debitum considers that trust and transparency are the essential assets for all projects. Losing the support and trust of their community can end their project at any step.
  2. They build and sustain their project’s credibility by being accurate with the allocation of funds, sharing constant product development and company updates, and adequately controlling the token supply to avoid manipulation of price.
  3. All projects can encounter challenging situations within their community. That’s why the Debitum team values that when difficulties arise, they must always be transparent and communicate efficiently.

Financing process with a smart blockchain contract following every step raises Debitum Network’s transparency. Anything written in each block is immutable, cannot be altered, and is known by everybody. So, each counterparty in the financing process knows what has been arranged at a particular stage, and each party is capable of verifying the correctness of any specific set of data they require.

Also, the management of the company explicitly explains the vision and mission statement to every employee, and this delivers financial plans and business goals crystal clear to everyone.  Communication itself within the firm is never sugarcoated, and everybody is kept in the loop, which assures employees to understand that nothing is hidden from them.

Conclusion

In all aspects of life, “the old” favors condemning “the new.” But, it usually turns out that “the new” has been born out of the profound necessity for innovation. The modern financial system requires disruptive and revolutionary changes in order to become more transparent, accountable and reliable. Blockchain based companies like Debitum can be the pioneers that will initiate the change and modify the opaque and outdated financial system into a much solid one.

 

Decentralized Financing is here thanks to Debitum Network: €10,000 to €1 million in as little as 24 hours.

Lithuania-based startup Debitum Network (DEB) co-founder Martins Liberts and his team have delivered on their promise. Debitum is indeed a real product that allows small business owners and entrepreneurs to be in charge of their future. This unique platform offers loan agreement opportunities, with returns of 10% to 15%, to investors of all sizes via smart contracts. Basically, you no longer have to be Warren Buffet to make money off of the hard-earned cash you have collecting dust in your bank account. Now you have the decentralized Debitum Network.

After raising $17 Million in its initial coin offering (ICO) launch March 2018, Debitum Network entered a period of sonic speed development. By September 03, 2018 Debitum Network was ready for Crowdsale Round B where it raised 1.2 Million Dollars, enough for initial product development and launch. Now that the Crowdsale is over, Debitum Network has turned its focus on expanding the ecosystem in 15 countries across Europe and the Balkan region by 2019. Debitum will exceed all expectations as its global ambition is to grow their operation in 50 countries around the world most in need of access to financing.  

Although Small & Medium Enterprise debts are profitable; traditionally centralized financiers make it complicated and even challenging for the average investor to engage in the process directly. Small business’ find it almost impossible to secure the finance they need from conventional banks. Up to 70% of SMEs lack access to adequate finance according to the World Bank, the problem is particularly acute among developing economies. Debitum has solved the problem by creating a standardized and streamlined Ethereum-based decentralized platform where global business borrowers can easily access global business lenders. This hybrid ecosystem bridges the gap between crypto and ‘real-world’ lending by combining features of cryptocurrency transactions and traditional lending thus providing everyone an opportunity to profit from SME capital revenue without being intercepted by opportunistic “middlemen”.

Eglė NemeikštytėFintech and blockchain community influencer Eglė Nemeikštytė, CEO of Blockchain Center Vilnius praised the Debitum Network platform, known as Abra 1.0, for being an excellent example to other fintech startups  adding “Debitum Network were the first in the Vilnius Blockchain Center community to show blockchain applicability in the fintech industry, and were the fastest to raise capital and launch their product. They proved that blockchain fintech projects could keep their promises, stick to deadlines and be efficient.” While loans are delivered in traditional fiat currency, DEB provides speed together with end-to-end integrity and transparency in the platform’s internal processes. Funding market operators can finally access their clients without suffering high expenses.

With individual investments starting from 50 EUR to a maximum of 10 Million EUR, investors can begin deploying their money as soon as they have completed a short authentication process on DEB’s fast and flexible platform. DEB opens up lending opportunities to the average person by allowing flexible options such as covering all or part of a borrower’s loan request. The decentralized nature of blockchain technology, combined with the use of smart contracts allows Debitum Network to rid the market of the time consuming and cumbersome process of traditional centralized funding outlets so investors can place their money to work in a more stable financial instrument at a time when crypto prices remain volatile; in as little as 24 hours. Participants can keep track of their investments as well as potential investment opportunities ranked according to risk., via a central dashboard in an ecosystem that includes debt collectors, risk assessors, and insurance providers, while amassing 10% to 15% on their investment in a single, transparent, trust-based and easily accessible ecosystem.

Martins Liberts, Donatas Juodelis, and Justas Šaltinis are among the Debitum Network core team of motivated finance and technology experts who already have a remarkable track record of creating working alternative financial solutions in Europe. These seasoned financial specialists are pioneering decentralized financing into a promising economic future.

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As if DEB successfully tackling the worldwide shortage of funding for underbanked small and medium-sized businesses by utilizing blockchain technology to deliver a unique ecosystem based on trust, full end-to-end financing process and structuring aren’t impressive enough already. This exciting and expanding platform assures beneficial growth for investors and funding recipients alike with its utility token given the fixed supply. No additional minting or mining of the tokens will be possible as a limited amount of DEB tokens were produced during the Token Generation Event (crowdsale round A). The fixed supply implies that as Debitum Network increases activity between borrowers, investors and service providers of the lending process, token demand will grow. As the demand on the Network grows, so will the value of DEB tokens. Supply & Demand on a stable decentralized financing platform is indeed a beautiful (and profitable) opportunity.

Debitum Network Links:

Official Website
Whitepaper
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Reddit
Bitcointalk
Medium
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Linkedin

Debitum Network: A Decentralized Solution To Small Enterprise Financing Crisis

The small and medium enterprises (SMEs) are regarded as the backbone of the economy, being the main contributors to employment in emerging and developing countries. Despite their value, access to finance is relatively limited when comparing to large firms and is a significant driving constraint for SMEs.

This financing restriction is because of SMEs nature that tends to be informal, have less publicly accessible data, and operate in unfamiliar sectors which results in higher information asymmetries and risk, and often, these businesses also do not have sufficient assets that can be utilized as collateral.

As the credit gap is still existing and growing, the incumbent initiatives are not likely to cope with the financing dilemmas, so a different approach is needed. The decentralization of lending, and the advanced disruption to financial services, therefore, looks set to proceed to narrow the credit gap for SMEs, and these all characterize the solution called the Debitum Network.

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Disrupting The Financing Sector

By developing a decentralized blockchain based ecosystem, Debitum Network will positively solve the financing concerns of small and medium enterprises. The system connects SMEs in a secure, and effective way and allowing them to utilize its power without a need for an intermediary. It also unites borrowers, lenders, insurers, risk assessors, and all those associated to the financing sector in one user-intuitive platform.

The entire project is placed on the Ethereum network and powered by Debitum (DEB) tokens. It utilizes smart contracts that make Debitum Network secure, transparent and efficient. It also operates as a decentralized ecosystem for parties globally to engage in every step of the financing process, consequently enhancing competence and reducing costs.

Instead of just giving financing options, Debitum also provides opportunities for business in the financing enterprise to access the global market without concerns.

A Unique Lending System and Processes

The financing process of Debitum was deliberately formulated to guarantee all parties are compensated in a fair, transparent, and efficient transaction system.

Borrowers

First-time users or borrowers are pre-qualified by the platform to ensure compliance and that their loan requests are real. After the verification, borrowers will issue a loan application where they can choose the kind of asset to receive from investors. The asset is then reviewed to see if it correspond to the loan application while risk assessors perform their part by double-checking the loan request, the available collateral, as well as providing suggestions on the financial features of the loan.

Investors

Debitum has an integrated insurance system depending on the type of loan which can be adopted to protect future investors from loan defaults as well as guaranteeing the credit is partially or fully paid in worst-case scenarios. When all is prepared, investors have the option to fund one or more loans with the data available such as the trust rating system. Also, investors who’ve financed loans can utilize the secondary market to liquidate their investments quickly. They additionally have the option to sell their current loan investments to interested investors; the rights of sold loans are then assigned automatically to the new investors with smart contracts.

Loan Payment

Debitum’s ecosystem encourages the full payment of loans, but in the case that a loan is not returned on time or breaks the agreements, the debt collection process in Debitum will cover the losses of the investor. Insurance holders are compensated immediately while the platform’s debt collection team moves forward in reclaiming the loans from the borrower. After the financing process, the trust rating system is updated automatically by smart contracts.

The Network’s Operation

DEB as Debitum’s official utility token is utilized as the mechanism for borrowers or investors to access the services on the platform such as risk assessments, acquiring insurance, and even debt collection. A trust rating system is also integrated inside the platform which is essential for all financing process.

All activities in the platform are connected to smart contracts that influence a party’s trust rating depending on the result. It keeps a healthy ecosystem for users as low-quality parties are naturally avoided and removed from the community. To prevent service providers from rendering less than satisfactory services at the start, they are obliged to freeze a particular amount of tokens as a guarantee to produce quality service to the platform’s users.

Debitum also has a hybrid approach that enables the smooth integration of fiat-crypto infrastructures which guarantees that as the adoption of cryptocurrencies increase, Debitum Network will be capable of adapting and offering its services in both fiat and cryptocurrencies seamlessly.

Recent Update And Development

The Debitum network launches its innovative platform known as Abra 1.0 with an investment portfolio of nearly 1 M EUR on September 3, 2018. Its hybrid ecosystem connects the gap between the crypto and ‘real-world’ lending. Blockchain technology, by utilizing the network’s Ethereum-based DEB crypto token will deliver speed together with end-to-end integrity and transparency in the platform’s internal activities while loans are granted in traditional fiat currency.

The CEO of Blockchain Center Vilnius, Eglė Nemeikštytė, considers that speed, efficiency, and commitment Debitum has presented in bringing its product to market are excellent examples to other fintech startups:

“Debitum Network was the first in the Vilnius Blockchain Center community to show blockchain applicability in the fintech industry, and were the fastest to raise capital and launch their product,” says Nemeikštytė. “They proved that blockchain fintech projects can keep their promises, stick to deadlines and be efficient.”

Abra 1.0 earned a positive response from partners, early investors and key personalities in the blockchain society at an event in Vilnius on August 23rd that contributed a hands-on chance to try out its services. These comprise a central dashboard on which investors can trace their investments, see how much money they have produced, and see potential investment opportunities, ordered according to risk. They also have a live demo page for interested users and test the efficacy of their newest system: Abra 1.0 Live Demo

Debitum Network co-founder Martins Liberts expressed his confidence in the platform:

“Debitum is about allowing small business owners and entrepreneurs to be in charge of their future,” stated Liberts. “We’ve done it in around six months, and we’ve done a lot of testing. We have trust in our product, and we’ll be joining the ranks of those few ICO projects that have already delivered a real product.”

Also, the Lithuanian Vice Minister of Economy Elijus Čivilis in attendance emphasized the importance of solutions like Debitum’s in tackling the global issue of access to finance among small businesses.

The Debitum team has said that they are already at work on version 2.0 of the platform and is scheduled to operate out in 15 countries by 2019. For complete specifications of Debitum Network’s platform features, development, and team, they have summaries and available Whitepaper to view.