The distributed banking is a concept brought about to break the monopoly of traditional financial institutions. This will happen via a new financial service that will provide return earnings to all users. The system aims at altering the cooperation model in financial services via a dynamic peer to peer cooperation model. This will birth a unique blockchain-based protocol called the Distributed Credit Chain that will help establish standards and do a number of positive things for the distributed financial business.
The cost sharing method of most credit agencies is very bad. Borrowers tend to incur additional cost while the profit margins of credit agencies are limited. The efficiency is also in question as a large amount of time and energy is wasted in trying to determine the net worth of borrowers that are not in their category. This wastes resources and also affects efficiency. Furthermore, the interest of the borrower is also affected because they are unable to certify their credit by themselves. Borrowers are deprived of knowing their right and interest. They are also prevented from really getting their credit together. Another sad point to note is the issue of joint debts which has hindered the development of the industry and also set up many social problems. The borrower feels that various credit agencies are aware of their debt information which is not supposed to be so. Asides, a centralized credit model will make these agencies enjoy the privilege of being a monopoly. This makes many financial institutions aim for more profit, rather than customer satisfaction.
The decentralized distributed credit chain seeks to address the issues listed above via some basic moves. There will be abundant competitors on the platform making everyone able to choose their debtors. The algorithms and computations on the blockchain will ensure market participants are able to get their returns seamlessly. Also, there will be data privacy as personal data will be sent straight to the recipient in an encrypted manner. Only the data recipient is given the opportunity to retain their data. The distributed credit chain system also aims at improving data validation efficiency. This will allow personal data to be used several times and it will also reduce the cost of the institutions using such data. A data marketplace where data certification bodies will be able to promote data standard is an additional feature on the DCC ecosystem. Lastly, lending data will help many institutions provide adequate analysis of the lender’s behavior. This will help non-participants of single time loans make a detailed credit rating system.
The team behind the Distributed Credit Chain
The brain behind the distributed credit chain is made up of Stewie Zhu, a serial entrepreneur in the internet, Daniel Lu PhD in Mathematics, Stone Shi and many others. To learn more about this unique project click on these links; website, whitepaper, telegram, twitter, facebook bitcointalk ANN, bitcointalk bounty
Author - Coltpython
