Dether is creating the first decentralized peer-to-peer ATM.
Peer-to-Peer (P2P) payment apps have recently sprung up as a quick and convenient way to send money between friends or family members. Individuals all over the world can transfer funds between one another’s accounts bank accounts with a simple swipe or tap: think Venmo for splitting the tapas tab after a Friday night out, or Square Cash for sending a last minute birthday gift to your nephew. There’s no shortage of apps promising to make it easier to pay bills, send cash, or get cash for yourself.
But why stop there? What if we could harness the power of P2P payment systems to create a decentralized P2P ATM for ether?
Fiat Fiasco
Over the past few months, we’ve conducted a series of interviews with early adopters and Dether alpha users from every continent to find out the biggest obstacle to Ethereum going global. The answer wasn’t surprising. In countries where the local fiat currency isn’t supported by an established cryptocurrency exchange, it’s nearly impossible for people to join the Ethereum ecosystem.
People in these countries are often forced to create informal trading communities, in which they exchange their local fiat currency for Euros or US Dollars. Then cash-in using local services, like convenience stores. Almost all online exchange services require a bank account, but over 2 billion people around the world still remain unbanked. These aren’t just statistics — many of our interviewees recounted their experiences helping unbanked friends and family access cryptocurrency. One described the experience as “exhausting.”
Even those who do have bank accounts or access to a fiat currency accepted by local exchanges still face several obstacles when trying to use cryptocurrency.
Online centralized cryptocurrency exchanges enable anyone who has a bank account and/or a credit card to access cryptocurrency and blockchain-based applications, but these exchanges have some major drawbacks. Not only are they inaccessible to the unbanked, but they’re also vulnerable to crypto-theft attacks because of their centralized design (i.e. the infamous Mt. Gox hack in 2014, and more recently, the attack on the South Korean crypto platform, Youbit, which bankrupted the exchange). What’s more, our current centralized exchanges are incredibly time-consuming: users have to access their bank accounts, make bank transfers, wait for the money to arrive, go through the KYC, wait for the money to arrive again, create an order, etc. Servers crash, transfers fail, and in the worst of cases, funds are lost.
The other, and more successful, avenue for individuals to access cryptocurrencies are decentralized exchanges, such as 0x, EtherDelta, and Airswap. Until recently, EtherDelta was the most used decentralized application on Ethereum. These solutions are great at providing a new way to exchange cryptocurrency in a peer-to-peer format. However, users first need cryptocurrency or tokens in order to exchange value from one point to another. There is no direct link to fiat currency. Yet again, billions of potential users miss out on the powerful advantages of a P2P payment system.
More and more teams of blockchain developers are working on decentralized applications that benefit people in regions where financial inclusion is limited (South America, Africa, South Asia), and many of the people in these regions have reached out to us at Dether because of our work on the cash-in/crypto-out problem. The Ethereum ecosystem needs a solution: how can we help a Tanzanian use a dApp, and its token, when he or she doesn’t have a bank account in the first place?
Dether’s vision is simple: cryptocurrency and blockchain technology should be available to everyone. With Dether, we are creating a new standard for P2P payment and developing the first bridge between any fiat currency by using both cash and cryptocurrency. Our goal is to make accessing cryptocurrency as easy as withdrawing cash from an ATM.
How it works:
Dether’s alpha runs on Ethereum Kovan testnet (so please don’t send any ether to your Dether wallet just yet!). The set-up process will guide you smoothly from the creation of your wallet to your first transaction:
As a first step, we launched Dether.js on November 17, 2017, a javascript library to interact with the Dether protocol. Soon, Dether will provide an easy way to cash-in and cash-out crypto, an urgent need for both the crypto community and, as blockchain technology starts to reach the masses, the world at large.
When it comes down to it, owning crypto isn’t just an investment opportunity. For many people we interviewed, crypto represents a safe-haven currency — a way to send money to loved ones across the globe and an opportunity to access smart contracts and develop new decentralized solutions on the Ethereum blockchain, no matter where you are in the world, and whether or not you have a bank account. Dether is more than a decentralized mobile app — it’s a protocol, a philosophy. We believe that the future should be open and accessible, and that blockchain technology belongs to everyone. With a decentralized P2P ATM like Dether, a few swipes on a smartphone puts anyone, anywhere in the world, in the loop.
