This is a paid article by Debitum Network.
I’ve written quite a bit about P2P investing on this blog, and I recently posted a summary of the best European P2P investment platforms. What I haven’t written about before, however, are platforms powered by the blockchain. That is precisely what I will be talking about today, in the shape of Debitum Network.
I’ve spoken about the reasons of existence for P2P lending platforms, but it’s worth summarising them again here. Approximately 70% of all micro and small to medium-sized businesses in emerging markets lack access to credit. This can be due to many factors, from over regulation to an underdeveloped banking environment in their country. We thus end up with an estimated $2 trillion credit gap for SMEs worldwide. This market is therefore ripe for innovation, as we have already seen in recent years through the success of Mintos and other platforms.
Debitum is a completely decentralized platform where investors can invest their money and small businesses can correspondingly apply for loans. The returns are projected to be around 10-15%, in line with other traditional P2P loan platforms that I’ve mentioned in other articles.
Debitum had its crowdsale already, which came in the form of an ICO where they raised more than $18 million. This should give the platform a solid base to build all the cool things that were planned. In fact, the first release of the platform, Abra 1.0, is already out.
With Debitum, you can not only invest fiat money, but you can also invest (and also withdraw) in crypto. This is very interesting for those who have a lot of assets tied up in crypto and for some reason or another are reluctant to switch these assets into fiat money. It would be much better to put those crypto assets to good use and see them grow by investing in a platform like Debitum Network. The crypto market, in general, has gotten hammered this year, so investors in crypto would be very happy to get some returns in the form of interest from loans.
Debitum Network is designed to unite borrowers and those who help them apply: investors (lenders), risk assessors, document validators, insurers, etc. Companies or individual professionals who work in the alternative finance space can connect-in to the network for free and immediately begin facilitating cross-border deals. All actions are processed through the Ethereum Blockchain, making Debitum Network a secure and incorruptible infrastructure. It’s made up of an Ethereum-based family of smart contracts, facilitated by one internal means of payment.
Transactions run through Fiat currencies, ensuring businesses can actually use the service easily in their locality, and from day one. Based on DEB token usage within its lifetime for each loan, the total needed to buy DEB tokens will surpass total ability to sell DEB tokens, thus creating upward pressure on DEB token price. This is the reason why there was such a frenzy for buying into the Debitum Network ICO, as investors were eager to grab DEB tokens hoping for a future rise in their price.
DEB tokens are already available for trading on the KuCoin and Lykke exchanges, with more exchanges joining in the near future.
If you’re the type who likes to read whitepapers, you can find the Debitum Network whitepaper here. I found it very interesting to go through the white paper as it explains how Debitum is attempting to address certain issues with P2P lending by using blockchain technology (Ethereum to be specific).
The Debitum Network team comes from the innovative technology company DEBIFO, a successful traditional invoice financing business in Europe, which is Mintos’s partner. Debifo finances invoices for Mintos, one of my favorite P2P loan platforms.
Debitum have a very interesting blog, which deals with topics that are of relevant to any investor. They’ve written about topics like:
- Types of interest rates
- What makes an investment safer
- Types of investing
I personally enjoyed going through the articles on their blog and saved many of them to my Pocket account for reading later during breakfast or commutes. I value such platforms not only for the monetary returns they give to investors, but also for the learning opportunities they provide.
By investing, say, a thousand euro onto a platform like Debitum, you now have a stake and are naturally inclined to keep reading about the goings-on of the platform and also informational articles like those found on their blog. By being invested, I find that I learn much more than if I just grabbed an investment book and read that. There is something about having a stake in something that makes learning more sticky.
Remember that there are already 500,000 Eur in available assets, there are no fees for investing on Debitum Network. Maturity times vary from 2 weeks to 18 months. There are various assets to choose from, such as factoring, business loans, property and stock.