We have been grateful for the incredible support from key stakeholders and our community. Since the Equifax hack, many lenders and partners have reached out to build on Bloom protocol. Bloom protocol offers innovations for both traditional lending businesses as well as crypto and digital asset lenders.
Bloom’s mission is to build a robust global credit infrastructure on the blockchain. We know that this will be a collective effort that will span many years and touch many different stakeholders. Among these stakeholders are crypto lenders. Crypto lenders are especially important as they also believe in a decentralized future, share in our global vision, and enable us to go to market faster by overcoming challenges together.
Today, we are very excited to formally announce our partnership with ETHLend.
We are excited to announce our work with ETHLend, the first running decentralized peer to peer lending platform.
In May 2017, ETHLend introduced decentralized lending application on the Ethereum blockchain network. ETHLend enables anybody to participate in a global, instantaneously accessible and liquid lending market using cryptocurrencies and ERC-20 tokens as collateral. Decentralized lending enables borrowers to receive competitive financing from lenders around the world. They do this by introducing reputation-based lending on their platform, where a reputation can be built upon lending activity, this is where Bloom integrates with ETHLend.
As we just saw with the Equifax hack, our credit system is flawed — with challenges in securely managing, maintaining and transferring credit history records. Bloom changes this by providing a protocol for securely assessing credit risk without unnecessarily exposing your data. We achieve this through a system of federated attestation-based identity verification and the creation of a network of peer-to-peer and organizational creditworthiness vouching, a perfect fit for a network like ETHlend which rethinks lending by creating a peer-to-peer pseudonymous based system.
Enforcement through Reputation-Based Lending
The nature of lending on blockchain opens the possibility to avoid repayment of the loan since the lender might not have all the necessary details of the borrower to enforce the debt in the borrower’s jurisdiction.
Bloom solves this through BloomID and BloomIQ.
By leveraging BloomID and BloomIQ, ETHLend can improve enforceability and payback rate of loans by verifying a user’s identity and connecting their payback to a global reputation system.
ETHLend will create reputation based lending with the help of decentralized credit rating, which consists of data from decentralized credit tokens (CRE), decentralized identities such as uPort, and data feeds from centralized service providers such as credit institutions and social media.
Bloom and the nodes on our network will update the payback rate of ETHLend loans tied to an individual user’s BloomID, this allows ETHLend to broadcast defaults to a BloomID for other lenders to consider when issuing a loan.
This is similar to how the current credit bureaus work today. When a lender issues a loan, they update the bureaus with the results of that loan.
Bringing ETHLend Loans to the Network
With a shared mission, ETHLend hopes to align accepted and established lending practices with the benefits of blockchain technology by creating a gateway for businesses, agencies and people everywhere. We believe that leveraging blockchain is the solution to better security, KYC and predictability.
ETHLend intends to use Bloom’s protocol in decentralized lending applications. Within the next year, we hope to provide the Bloom user experience on the decentralized ETHLend application. By leveraging the Bloom protocol, defaulted ETHLend loans will be captured in the Bloom network. Reporting these defaults will provide an incentive for the borrowers to repay loans and hence create more confidence for the ETHLend reputation based lending market.
More importantly, Bloom users will be able to tap into a lending ecosystem facilitated by ETHLend and our other lending partners. As ETHLend grows their available supply of capital, loans become easier and more readily available for the entire ecosystem.
Together, we are looking forward to bringing more financial access to everyone around the world.
More on ETHLend: https://ethlend.io
More on Bloom: https://hellobloom.io
Join the Conversation: hellobloom.slack.com