Many people view cryptocurrencies as a legitimate threat to traditional finance. Moreover, currencies such as Bitcoin offer financial services to people in underbanked regions. Ripio Credit Network wants to connect lenders and borrowers all over the world to establish a peer-to-peer global credit network.
What does the Ripio Credit Network Provide?
The Ripio Credit Network wants to offer a real global credit ecosystem which is more suitable than traditional solutions and even than similar peer-to-peer lending services. While that sounds like a tall order, the RCN protocol will connect lenders and borrowers all over the world via the native RCN token. By supporting any currency currently available, the team aims to make a big impact in the future.
How Does it all Work?
The RCN network has various aspects which combine to form an ecosystem that will offer many benefits. On the one hand, we have the wallet providers, which allow users to generate smart contracts and add information regarding borrowers and their credit requests. All of this is done through a convenient and transparent system. Borrowers also have their identities verified as a security measure, which is an absolute necessity when dealing with lenders and borrowers.
Every borrower and lender in the Ripio Credit Network will receive a credit score from a scoring agent. By gathering transaction information from traditional and non-traditional sources, it becomes possible to determine the “creditworthiness” of individual users. Even then, it is still advised to insure any loan made on the network in case of default. Distributing each lender’s risk by adjusting the smart contract’s conditions will also open up a lot of new opportunities.
Last but not least, the Ripio Credit Network offers a credit exchange to match lenders’ offers with borrowers’ credit requests. This is also handled by the smart contracts generated by the wallet provider for added convenience. It is evident there is a lot of merit to this system, assuming enough people decide to use it in the future. All of this is made possible by the RCN token, which also needs to be highlighted.
What exactly is the RCN Token?
As is the case with any blockchain ecosystem, the Ripio Credit Network has its own native RCN token. It is the network’s payment channel first and foremost. Although credit transactions can be settled in any local currency, one does need RCN tokens to access the network and facilitate transactions. Without this token, there is no way to access any of the services Ripio Credit Network offers its users.
What Comes Next?
Building such a powerful credit network will not be easy. For now, there is no official roadmap posted on this project’s website, although that doesn’t mean there isn’t any work taking place behind the scenes. For now, we will have to wait and see what the future holds for the Ripio Credit Network, as there is still a lot of work to be done before this ecosystem becomes a go-to global solution for lending and borrowing.