Collaborative savings and insurance platform WeTrust, an Ethereum blockchain platform aiming to bring financial inclusion to the masses, has announced the launch of its very first Trusted Lending Circles product. The blockchain-based reciprocal aid platform leverages smart contracts to allow anyone to create a Rotating Savings and Credit Association – ROSCA – with a group of trusted associates to help one another.
Trusted Lending Circles is the first of WeTrust products to be launched. It implements the concept of ROSCA on Ethereum blockchain to create a trustless, transparent, community or a closed user group oriented investment and reciprocal aid system. Trusted Lending Circles currently supports basic ROSCA, created amongst close friends and family. Other upcoming products and features include credit scores, large scale ROSCAs, trusted direct borrowing/lending and mutual insurance. With these blockchain-based products and features, WeTrust aims to provide alternative financial services to over 2 billion unbanked adults across the world.
In the ROSCA, a group of trusted associates participate by contributing a fixed amount at regular intervals based on a mutually agreed framework on how the funds should be distributed among the associates. The collected contribution is then disbursed in a reverse auction, where the lowest bidder is offered the bidding amount and the rest equally distributed among other associates. All ROSCA related transaction details are recorded on the Ethereum blockchain while smart contracts govern the bidding process, ensuring transparency and eliminating the need for a trusted third party or an intermediary.
The WeTrust pilot is currently confined to the cryptocurrency community. Once a precedent is set for blockchain-based ROSCAs, the platform will expand to other communities by integrating stablecoins for the benefit of those who are comfortable using stable fiat currencies.
A spokesperson said: “We envision a system where financial services have aligned interests with the user/ policyholder, and essential financial products are provided at a fair price to users and policyholders. We are building WeTrust to solve this problem.”
WeTrust launched its Trustcoin (TRST) crowdsale on March 2nd. During the six-week long token sale, WeTrust will distribute 80 million of the total 100 million Trustcoins among the participants. The remaining 20% is set aside for the founding team and advisors (10 million TRST vested over two years), Finclusion Labs – the organization building the WeTrust platform (8 million TRST) and bounty programs (2 million TRST). Investors participating in the crowdsale can buy Trustcoin with either Bitcoin or Ethereum. Early investors stand to benefit from the bonus. WeTrust offered a 30% bonus on the first day, which was reduced to 25% during the first week. Similarly, those participating during the second, third, fourth, fifth and sixth weeks will receive a bonus of 20%, 15%, 10%, 5% and 0%, respectively.