Transcription

Teddy: Today we've invited a very innovative RWA project called Creditcoin. They'll be talking about what they've been building, challenges they've faced in the past, and how their product in particular has pushed the space forward.

Teddy: So yeah, I guess we should dive into it. Tae, maybe you want to give a quick intro on yourself, and then I have a few questions for you on Creditcoin’s product. Why don't we start with a quick intro from you.

Tae: Thanks for the intro. My name is Tae. I'm the founder of Creditcoin, and also CEO of Gluwa, the builders of Creditcoin. Creditcoin started as an interoperable credit network allowing people to invest using their crypto, and also the borrowers build a credit record and therefore build their credit history.

And we started this journey around the end of 2017. We have been working on the problem before the word RWA and everything. And I'm glad that we are seeing a lot of other RWA projects coming up, and also innovative projects like Plume joining the field.

Teddy: Awesome, awesome. Yeah, I feel like the space has grown a lot. At least personally, I've seen tremendous growth in its vertical from different projects as new technology comes onto the scene. So it's great to see that the RWA space is moving forward as a whole.

So, I've prepared a few questions. I think it'd be great to dive into the meat of the business a bit to understand more about what Creditcoin is building.

Moving to the first question: so Creditcoin launched in 2017. As you mentioned, you guys were a first mover in this space. So, you guys started building years before RWAs became a crypto narrative. What were the problems you saw that needed solving back then?

Tae: Great question. So back in 2017, it was right after Ethereum was becoming popular, and we were digging into the crypto industry and trying to figure out what problem we could solve with blockchain technology. And we first saw blockchain technology as a borderless financial network, which Bitcoin, Ethereum, and other stablecoin projects have accomplished to build. But we were missing a credit network within this industry. So if you think of Bitcoin or stablecoins as a debit card, we were missing a credit card, just to simplify. And we were trying to figure out why it was missing and how we would build a credit network within Web3.

By digging into the problem, what we realized is, that within Web3, there was no such concept of credit. So there was no infrastructure for people to borrow money, and even if they successfully borrowed some amount of money, there was no infrastructure to build a credit history so that they could borrow money in the future at a more competitive rate, and so on and so forth.

And a similar problem was happening in the emerging market. Now I learned this from my fellow Fintech founder, who was running a successful lending business in Nigeria specifically, and a couple of other lenders in the emerging market. Their problem was while they were deploying loans to the unbanked or underbanked, which was happening at a very favorable rate, because there were no more alternatives by the definition of unbanked or underbanked, they had no access to credit from banks. But the problem was all that credit transactions were happening outside of banking infrastructure. Therefore, banks could not appreciate the credit history that was siloed within the database of each Fintech lender.

So this was the problem of data being subjective, and this is a perfect problem for blockchain technology to solve. So, we initiated the Creditcoin project to enable not only cross-border lending and borrowing, but also a system to accumulate credit history so that people can accumulate credit. Therefore, a Fintech lender that's facilitating loans for people in the emerging market can raise, based on their customer profile from overseas, at a better rate compared to what they can raise domestically. That's how we started.

Teddy: That's great. Now that's great to hear that you were targeting a problem that you saw in an emerging market, and providing better infrastructure for people to operate more efficiently in the financial world. Because as we know, it's always difficult to borrow money at times, depending on the business, depending on your underlying business. So, it's great to hear that you guys are solving that issue.

Moving to my second question. I saw that Creditcoin’s development company, Gluwa, which as you mentioned you're the CEO of, has actually recently partnered with the Central Bank of Nigeria, and has been speaking with other African governments.

My question here is, what can you share with us about these partnerships and how they relate to real-world assets (RWAs)?

Tae: A lot of countries in Africa have a very large underbanked or unbanked population and they are obviously interested in banking these people so that they can be included in the financial infrastructure, and even the global market. But current available technology has its limitations, obviously. For example, treasuries from banks find it really economically unfeasible to have branches everywhere.

Africa is a huge continent and having branches everywhere to serve, let's say a branch serving like 100 people where GDP per capita is $2,000 dollars is not economically feasible. So they're reluctant to expand out there, and for that reason some technology like mobile money is popular. People started to use mobile minutes instead of cash as a form of currency, and that evolved into a concept of mobile money, very popular in Africa, but that also has a lot of limitations. First you have to have a cell phone, which is growing fast, but the second part of the problem is you have to have a local phone number to have a wallet, and that means you will never be able to transact with people outside of your country. So, this limits what you can do with the account and the money that you hold within your cell phone.

And a second part of the problem with mobile money, in this case, is that mobile money is usually operated by a lot of foreign telcos, or telcos in general, and they're not financial institutions first. So, therefore they're not, they're less regulated compared to how the banks would be regulated. So that control of a central bank, or information that a central bank can access from this mobile money wallet, is limited. For that reason a lot of African countries are interested in the concept of CBDC. They are interested in how you can operate as essentially a mobile money, but sans a domestic phone number requirement so that anyone can start to open up a wallet, and also foreigners to open up a wallet that allows them to transact with Africans. And this is a very promising model for them because they're interested in including the African population to the global digital economy.

They see India as a success case, maybe even the Philippines. So people can serve, via the internet, digital services, and if that be development, call center, design, whatever, you can provide over the Internet and get paid cross border using digital currency. To enable those, they are interested in CBDC, and buy us building their CBDC compatible with Web3, public chains on Web3, they are going to enable DeFi-integrated RWA assets and CBDC payments, and so on and so forth. So, I would say this is actually opening up new territory, for not only for Africans, but also for everyone who couldn't transact with Africans before, and I think the next five to ten years will be very interesting to interact with them.

Teddy: I definitely agree. I feel like moving into the digital age and bringing things on to the blockchain rail has definitely unlocked a lot of benefits, like you mentioned, with accessibility, transparency, etc. So, it's great to hear that you guys are pioneering that move out in Africa.

My next question is: I know that Creditcoin is currently running a testnet for its new EVM chain; are you looking for RWA builders specifically, or is it open to all types of developers?

Tae: We are evolving Creditcoin to an EVM-compatible chain, and because it's EMV-compatible, Turing complete, you can essentially run anything you want to run on top of it. Any smart contract that you want, or you have been running on Ethereum or other EVM-compatible chains, you should be able to run on top of our EMV-compatible Creditcoin, which we are currently calling CC3, because it's a third major version of Creditcoin. But then, because we have our ethos started with the RWA, we will have a lot of resource RWA builders. We will focus a lot of effort uplifting them so that they can have access to our millions of users and also relationship with CBDC projects and whatnot. So, people can have very specialty functions, ecosystem, and access by joining our network.

Teddy: That's great. Yeah, that makes a lot of sense. I think it's it's always exciting to see more developers just really just pushing the space forward as a whole So, yeah, I mean I think those were my main questions about Creditcoin. Maybe we can have more of an open discussion. I know we've been talking more about Creditcoin for the first half of this AMA, but happy to answer any questions you might have on Plume and how I think we can work together as two projects building in the space. So, I'll turn it over to you, Tae, to see if you have any particular questions.

Tae: Absolutely. So, it seems like we missed Plume. Like two, three years ago because we were actually building a lot of things that Plume is currently offering and will offer soon, building ourself for our very specific case. If Plume existed, I guess, like two years ago, I guess we could have onboarded on Plume and tokenized our loans that we could sell, we have been selling through Gluwa Invest a year or two ago.

It seems like you guys are trying to build a pipeline that potentially allows are various assets to get tokenized, but is there any limitations that people should know about that? If, let's say, I have any random real-world asset: what is a good rule of thumb for me to know if my real-world asset is compatible with Plum's platform or not?

Teddy: Yeah, yeah, that's a great question and actually, for the net new people in the audience, just in case you guys aren't familiar; at Plume, what we're building, is a new modular L2 that is focused on the real world asset space. And our three main core pillars, I'd say, fall under end-to-end tokenization for any sort of asset. We also focus on RWA composability, and I think our last focus on a very high level is creating this liquidity hub for capital to come into the ecosystem, invest in a specific asset, and cross-pollinate into any other type of asset that they'd be interested in.

So I guess to answer your question: what we've built at Plume is basically an end-to-end tokenization structure. So, if you had any specific asset in the real world and needed to tokenize this and bring it on-chain for all the benefits that we spoke about earlier, we actually provide all the infrastructure a project or developer might need. To give you some examples, like on the compliance side, we offer all the different integrations with on-ramps, KYC providers, account abstraction providers, and on the tokenization side, we're also plugged in with different licensed ATSs and transfer agents that are built on-chain.

What we've really built here is just an easy way for anyone to move any sort of asset on-chain. And what we find most important is that: as this space continues to grow, I think a lot of people will be tokenizing very interesting assets, and once these assets are on-chain we believe that the next step is, really to like you mentioned Tae, is to layer-in DeFi to unlock liquidity and enable a trading of these specific assets.

I would say our three main use cases would be to allow people to borrow and lend against your real-world assets to speculate, and trade perps on specific assets, or even to yield farm. Putting money into yield-bearing pools to just earn passive income. To answer your question, what we're building here is basically an entire ecosystem to have all these types of assets live in one spot. And to also make it easy for projects to deploy any asset and once they're on-chain we have a liquidity hub of capital coming in and providing TVL to these specific projects.

Tae: Can you describe more about the liquidity hub that you guys have? So, once let's say, I tokenize my assets like real estate, for example. What happens next? Do I go to a platform like Uniswap and list my asset against Ethereum, or do I go to a specific swap or DeFi protocol? Basically what happens after I successfully tokenize my asset with Plume?

Teddy: Yeah, yeah, that's a great question. I would say once a developer tokenizes their asset with Plume, there are a few routes it can take. The first route is obviously tokenize and you build your own protocol, and we have all of the resources to help build up a brand and help go to market within the Web3 space. We give a lot of support to projects, whether it's project spotlights, weekly AMAs. We have a bunch of ecosystem incentives, such as grants, token incentives, and whatnot. But there's another route where if an asset-issuer tokenizes a qualified asset, they can actually work with one of our new products on Plume to basically join, I would say on a high level, it's just basically joining one of our yield-bearing asset pools, where we have specific assets that we find very interesting, and obviously we've diligenced them pretty thoroughly on our side.

So that when our capital markets BD team reaches out, and our team's been working pretty hard on the sourcing front with different, I would say different family offices in Asia, different middle-market funds, some on-chain sources such as exchange wallets or different protocol treasuries. So when they express interest in parking money on Plume, we can direct those funds and that flow into specific pools that we deem, that could be, a safe investment for these types of investors.

Tae: Can I ask you one more question? Do you think it would be a fair comparison to call Plume like a Coinlist, but for RWA?

Teddy: I think… that is a good question. I think a good way to think of Plume is basically: any other EVM chain with tooling that's really created and focused on bringing these types of assets on-chain. But since a lot of our team actually comes from larger ecosystems as well, I would say that we provide the same level of support that projects would need from the larger chains like Polygon and BNB, but can't get at the earlier stages. And I guess, for the Coinlist analogy: I think that's just a part of what we're doing.

Our end state is really a chain where all these different real-world assets will exist in one place. People can come in and play with these and invest in these different real-world assets that have some DeFi component to it. Because in our opinion, with the markets heating up, that is what makes RWAs a little bit more interesting. Being able to, like, speculate, being able to borrow, lend, and basically doing things that you really couldn't before. And once you're done playing in, I would say, like, the crypto RWA jungle, you can move your assets into our yield-bearing pools to earn passive yield.

It's like a one-stop shop for everything RWA-related. So, yeah, answering your question, I would say the Coinlist analogy is part of what we're doing. But overall, we're just a chain that is really geared towards real-world assets and creating this flywheel of assets and capital as they both accelerate each other, and help grow the ecosystem.

Tae: Understood. Thanks for clarifying.

Teddy: I know we're getting up on time. We've loved the discussion today with you. Before we close it off, I was wondering if you are heading to any conferences? Do you guys have any closing remarks you'd want to make to the audience before we end things today?

Tae: Well, I personally don't go to conferences as much, but my team is going to Token2049 in Dubai and what else? The one in Austin. Yeah, but anyway, you'll find them there.

Teddy: Perfect. Yeah. We'll be in Dubai. Our team is actually leaving tomorrow night. So we'll be out there. Would be great to meet your team in person. I've known Alan actually on your team since 2023. Yeah, so it'd be great to meet other people on the team.

Thanks again Tae for coming on and speaking about Creditcoin. I really like what you guys are doing, and I think that there's a lot of ways that Plume and Creditcoin can work together in the future. So, looking forward to that.

Tae: Absolutely. Thanks so much for inviting us.

Teddy: Of course. Thanks, guys. Have a good day.

About Creditcoin

Creditcoin is the world’s leading real-world asset infrastructure chain for financial institutions, connecting global borrowers, lenders and investors on-chain. To date, the protocol has helped its partners record over 4.27 million real-world credit transactions, valued at $79.7 million USD, while servicing 337,000 customers worldwide across emerging markets.

By transparently securing credit history and loan performance on the Credicoin network, the protocol has already helped thousands of borrowers, businesses, and investors secure capital financing, build credit history, and grow their global RWA investment footprint.